The AUD is the strongest of the major currencies, while the NZD is the weakest. The USD is mixed with the GBP, CAD and NZD the strongest and the EUR and AUD are the weakest. The JPY and CHF are unchanged
There is uncertainty surrounding the Federal Reserve’s next interest rate decision, particularly after September’s U.S. consumer prices grew faster than expected.
At 8:30 AM ET, U.S. retail sales data for September will be closely watched as it provides insight into consumer spending, a major driver of the economy. Economists anticipate a 0.3% increase in retail sales from August, with core sales expected to rise by 0.2%. A stronger-than-expected reading could raise concerns about inflation rebounding and reinforce the idea that the Federal Reserve may need to maintain higher interest rates for an extended period.
Canada CPI will also be released at 8:30 AM with expectations of 0.1% for the month-to-month and year-on-year at 4.0% (versus 4.0% last month).
There are also a slew of Fed speakers today who will weigh in with their thoughts on the economy. The Fed “blackout period”, ahead of the November 1 interest rate decision, will start after Friday. On the schedule today are:
- Fed’s Williams will speak at the Economic Club of New York at 08:00 EDT.
- Fed’s Bowman will discuss Digital Currency at 09:20 EDT.
- Fed’s Barkm will address the Real Estate Roundtable at 10:45 EDT.
- Fed’s Kashkan will speak about the Economy & Healthcare at 17:00 EDT.
On Thursday, Feds Powell will speak at the economic club of New York at 12 noon
A snapshot of the markets as the NA session gets underway shows:
- Crude oil is trading down $0.22 or -0.26% at $87.47. At this time yesterday, the price was trading at $87.47
- Spot gold is trading up $4.70 or 0.24% at $1924.86. At this time yesterday, the price was trading at $1915.22
- Spot silver is trading up $0.10 or 0.46% at $22.69. At this time yesterday, the price was trading at $22.57
- Bitcoin is trading at $28,489. At this time yesterday, the price was trading at $27,750
in the US stock market, the major indices are trading lower. In the earnings today, Bank of America, Goldman Sachs, Johnson & Johnson or reported:
Goldman Sachs Group Inc (GS) 03 2023: BEAT
- EPS: 5.47 (exp. 5.31)
- Revenue: 11.82 billion (exp. 11.19 billion)
- Net interest income: USD 1.55 billion (exp. 1.86 billion)
Bank of America Corp (BAC) 03 2023: BEAT
- EPS: 0.90 (exp. 0.82)
- Revenue: 25.2 billion (exp. 25.14 billion)
Bank of New York Mellon (BK) 03 2023: BEAT
- Adjusted EPS: 1.27 (exp. 1.15)
- Revenue: 4.37 billion (exp. 4.33 billion)
Johnson & Johnson (JNJ) 03 2023: BEAT
- Adjusted EPS: 2.66 (exp. 2.51)
- Revenue: 21.35 billion (exp. 21.03 billion)
- Raises FY guidance
Looking ahead to earnings later today and this week shows:
- Tuesday: Ericsson, United Airlines, JB Hunt report later
- Wednesday: P&G, Morgan Stanley, Tesla, Netflix
- Thursday: Philip Morris, AT&T, American Airlines, TSMC, Nokia, Intuitive Surgical, CSX
- Friday: American Express
A snapshot of the stock futures currently shows
- Dow Industrial Average futures are implying a decline of -72 points. Yesterday the index rose 314.25 points
- S&P index futures are implying a decline of -11.25 points. Yesterday the index rose 45.83 points
- NASDAQ futures are implying a decline of -47 points. Yesterday the index rose 160.75 points
In the European equity markets, the major indices are mostly lower
- German DAX, down -0.37%
- France’s CAC, down -0.17%
- UK’s FTSE 100, up 0.43%
- Spain’s Ibex, down -0.19%
- Italy’s FTSE MIB, down -0.24% (10 minute delay)
In the Asia Pacific market, major indices rebounded higher:
- Japan’s Nikkei index rose 1.2%
- China’s Shanghai Composite Index rose 0.32%
- Hong Kong’s Hang Seng index rose 0.75%
- Australia’s S&P/ASX index rose 0.42%
In the US debt market, yields are moving higher with the yield curve steepening. The 2 yield is well above the 5% level at 5.117%. The thirty-year is approaching 5% once again.
- US 2Y T-NOTE: 5.117% +2.0 basis points
- US 5Y T-NOTE: 4.753% +3.6 basis points
- US 10Y T-NOTE: 4.762% +5.3 basis points
- US 30Y BOND: 4.911% +4.5 basis points
- 2-10 year spread is at -35.9 basis points which is up 3.4 basis points on the day
In the European debt market, benchmark 10-year yields are also trading higher:
European benchmark 10 year yields