Market Talk – October 4, 2023

ASIA:

Japanese Prime Minister Kishida Fumio is addressing the challenges posed by rising energy and food prices. He recently emphasized the critical state of Japan’s economy and instructed his Cabinet ministers to develop economic measures for a supplementary budget. These measures aim to tackle issues like inflation, wage increases, investment in domestic semiconductor industries, labor shortages, and population decline. The yen’s decline against the U.S. dollar is making imports more costly, impacting households. In October, prices for 4,500 food items are set to rise significantly, with items like processed foods, confectionery, ice cream, cell phone chargers, toilet paper, pet food, and hotel rates all seeing substantial increases. Additionally, gas prices have been on the rise for 16 consecutive weeks, and household electricity rates have surged by 42 percent.

The major Asian stock markets had a negative day today:

• NIKKEI 225 decreased 711.06 points or -2.28% to 30,526.88
• Shanghai closed
• Hang Seng decreased 135.38 points or -0.78% to 17,195.84
• ASX 200 decreased 53.20 points or -0.77% to 6,890.20
• Kospi decreased 59.38 points or -2.41% to 2,405.69
• SENSEX decreased 286.06 points or -0.44% to 65,226.04
• Nifty50 decreased 92.65 points or -0.47% to 19,436.10

The major Asian currency markets had a mixed day today:

• AUDUSD increased 0.00225 or 0.36% to 0.63235
• NZDUSD increased 0.00058 or 0.10% to 0.59118
• USDJPY increased 0.047 or 0.03% to 149.067
• USDCNY decreased 0.00133 or -0.02% to 7.31777

The above data was collected around 14.22 EST.

Precious Metals:

• Gold decreased 4.24 USD/t oz. or -0.23% to 1,818.57
• Silver decreased 0.258 USD/t. oz or -1.22% to 20.892

The above data was collected around 14:25 EST.

Some economic news from last night:

New Zealand:

RBNZ Interest Rate Decision remain the same at 5.50%

No economic news from today:

EUROPE/EMEA:

The Bank of England has cautioned financial institutions not to underestimate the risk of loan defaults, especially among vulnerable borrowers, due to rising inflation and interest rates. In a letter addressed to chief financial officers of supervised financial firms, the central bank also advised against overestimating the recovery of funds in case of loan defaults. Victoria Saporta, the BoE’s executive director for prudential policy, encouraged firms to reassess their risk models to account for factors like affordability, considering the impact of higher inflation and interest rates on vulnerable borrowers and sectors.

The major Europe stock markets had a mixed day today:

• CAC 40 decreased 0.32 points or -0.00% to 6,996.73
• FTSE 100 decreased 57.71 points or -0.77% to 7,412.45
• DAX 30 increased 14.71 points or 0.10% to 15,099.92

The major Europe currency markets had a mixed day today:

• EURUSD increased 0.00398 or 0.38% to 1.05048
• GBPUSD increased 0.00645 or 0.53% to 1.21395
• USDCHF decreased 0.00372 or -0.40% to 0.91708

The above data was collected around 14:32 EST.

Some economic news from Europe today:

Spain:

HCOB Spain Services PMI (Sep) increased from 49.3 to 50.5

Italy:

HCOB Italy Services PMI (Sep) increased from 49.8 to 49.9

France:

HCOB France Services PMI (Sep) decreased from 46.0 to 44.4

Germany:

HCOB Germany Services PMI (Sep) increased from 47.3 to 50.3

Euro Zone:

HCOB Eurozone Composite PMI (Sep) increased from 46.7 to 47.2

HCOB Eurozone Services PMI (Sep) increased from 47.9 to 48.7

UK:

S&P Global/CIPS UK Composite PMI (Sep) decreased from 48.6 to 48.5

S&P Global/CIPS UK Services PMI (Sep) decreased from 49.5 to 49.3

US/AMERICAS:

President Joe Biden has announced $9 billion in student loan forgiveness for 125,000 Americans. This relief is a result of his administration’s fixes to various programs, including income-driven repayment plans and Public Service Loan Forgiveness. More than $5 billion of the aid will go to 53,000 borrowers who have worked in public service for a decade or more, $2.8 billion will be for 51,000 borrowers enrolled in income-driven repayment plans, and another $1.2 billion will go to 22,000 borrowers with disabilities. This announcement is expected to benefit Biden as he runs for reelection. However, it comes after the Supreme Court struck down his plan to cancel up to $20,000 in student debt for tens of millions of Americans.

US Market Closings:

• Dow advanced 127.17 points or 0.39% to 33,129.55
• S&P 500 advanced 34.3 points or 0.81% to 4,263.75
• Nasdaq advanced 176.54 points or 1.35% to 13,236.01
• Russell 2000 advanced 1.86 points or 0.11% to 1,729.01

Canada Market Closings:

• TSX Composite advanced 13.89 points or 0.07% to 19,034.81
• TSX 60 advanced 1.1 points or 0.1% to 1,142.9

Brazil Market Closing:

• Bovespa advanced 188.41 points or 0.17% to 113,607.45

ENERGY:

The oil markets had a mixed day today:

• Crude Oil decreased 4.91 USD/BBL or -5.50% to 84.320
• Brent decreased 5.071 USD/BBL or -5.58% to 85.849
• Natural gas increased 0.0126 USD/MMBtu or 0.43% to 2.9616
• Gasoline decreased 0.1592 USD/GAL or -6.75% to 2.2009
• Heating oil decreased 0.177 USD/GAL or -5.54% to 3.0184

The above data was collected around 14:35 EST.

• Top commodity gainers: Sugar (1.01%), Cheese (0.51%), Orange Juice (2.81%) and Butter (0.53%)
• Top commodity losers: Milk (-8.70%), Brent (-5.58%), Gasoline (-6.75%) and Heating Oil (-5.54%)

The above data was collected around 14:42 EST.

BONDS:

Japan 0.806% (+4.4bp), US 2’s 5.06% (-0.092%), US 10’s 4.7413% (-6.07bps); US 30’s 4.88% (-0.059%), Bunds 2.936% (-2bp), France 3.507% (-2.6bp), Italy 4.903% (-2.9bp), Turkey 24.92% (-2bp), Greece 4.417% (-1.5bp), Portugal 3.664% (-2.4bp); Spain 4.035% (-3bp) and UK Gilts 4.583% (-1.9bp)

The above data was collected around 14:50 EST.