Quotes of futures for US stock indices do not show a single dynamics at the auction on Tuesday.
The US stock market has declined in the previous four sessions, and risk appetite remains low due to investors’ fears that the Federal Reserve’s (Fed’s) rapid tightening of monetary policy will dampen economic activity and corporate profits, Market Watch notes.
CEO of JPMorgan Chase & Co. Jamie Dimon said the day before that the S&P 500 index could fall by another 20% amid the ongoing tightening of monetary policy by the Fed. This year, the stock indicator has already lost 24%.
Dimon warned that the US economy could fall into recession in the next six to nine months.
Yields on two-year US Treasuries, which are sensitive to a hike in the base rate, rose above 4.3% on Tuesday, close to the maximum since 2007. The interest rate on ten-year US Treasury bonds rose during trading above the 4% mark.
“The 10-year US Treasuries are back above 4% and we expect the pressure on the US stock market to continue,” said Peter Garnry, head of equity strategy at Saxo Bank A/S. profits and cause disappointment in the prospects of the companies.”
S&P 500 companies’ third-quarter combined earnings are up 4.5% year-over-year, according to Refinitiv’s forecast. Profits of energy companies are expected to have grown by 6.3%, banks – have decreased by 1.6%.
Citigroup Inc., JPMorgan, Morgan Stanley and Wells Fargo & Co. will release quarterly results this week. Bank shares lost 0.2%, 0.4%, 0.3% and 0.5% respectively in early trading on Tuesday.
American Airlines Group Inc. rose by 4.3%. The airline improved its forecasts for revenue and revenue per marginal passenger turnover in the third quarter.
Shares of Delta Air Lines Inc. add 2.8% to the price. The airline said Tuesday it is investing $60 million in flying taxi developer Joby Aviation Inc. and intends to use air taxis to deliver passengers to airports in the future, bypassing traffic jams in New York and Los Angeles.
Joby shares rose 18%.
The value of the December E-mini futures for the S&P 500 fell by 0.1% to 3621.75 points by 15:50 Moscow time on Tuesday. Quotation of the December E-mini futures on the Dow Jones index increased by this time by 0.02%, to 29266 points. Futures on the Nasdaq 100 for December fell 0.14% to 10969.5 points.
Oil prices deepened their decline on Tuesday afternoon on concerns about global fuel demand and a stronger dollar.
December futures for Brent on London’s ICE Futures exchange fell by $2.14 (2.22%) by 14:30 CST to $94.05 per barrel.
Quotes of futures for WTI for November in electronic trading on the New York Mercantile Exchange (NYMEX) by the specified time fell by $2.28 (2.5%) to $88.85 per barrel.
On the eve of Brent fell 1.8%, WTI – 1.6% after the publication of data that the Purchasing Managers’ Index (PMI) in China’s services sector, calculated by Caixin Media Co. and S&P Global, fell to 49.3 points in September from 55 points in August.
An index value below 50 points indicates a drop in business activity in the service sector. The indicator in the world’s second largest economy and largest importer of fuel fell below this mark for the first time in four months.
Meanwhile, Shanghai and several other major cities in China have ramped up coronavirus testing of residents to the most active level since August and imposed travel restrictions, writes Barron’s. Such measures may be linked to the 20th Congress of the Communist Party of China, which will begin in Beijing on October 16.
Additional pressure on the quotes is exerted by a strong dollar, which continues to strengthen on the statements of the Federal Reserve System management.
By the beginning of next year, the level of the key interest rate in the US may slightly exceed 4.5%, according to the chairman of the Federal Reserve Bank (FRB) of Chicago, Charles Evans. According to him, the Fed will need to keep rates high for some time to cool the economy and the labor market.
Meanwhile, Fed Vice Chair Leil Brainard noted the need for tighter monetary policy to slow inflation, but added that the Central Bank’s decisions will depend on incoming statistical data.
“The Fed is likely to raise rates by another 75 basis points in November, which will strengthen the dollar and limit the rise in oil prices,” Schneider Electric analysts wrote.
Stock indexes in the Asia-Pacific region (APR) mostly fell in trading on Tuesday, with the exception of the Shanghai Shanghai Composite.
Including pressure on the markets had a fall in the shares of the technology sector.
As reported, the US authorities last week introduced new restrictions on the supply of advanced chips and equipment for the production of semiconductors to China to prevent the development of the Chinese military industry through these products.
This decision negatively affected the papers of semiconductor manufacturers, including South Korean Samsung Electronics Co. and its competitor Taiwan Semiconductor Manufacturing Co. (TMS).
In addition, Asian markets declined following the dynamics of Wall Street.
American stock indices fell on Monday for the fourth session in a row. At the same time, the value of the Nasdaq Composite fell to a minimum in more than two years – since June 28, 2020, according to Dow Jones Market Data.
The value of the Japanese Nikkei 225 index by the close of trading decreased by 2.6%.
Japan’s current account surplus narrowed to 58.9 billion yen in August from 1.5 trillion yen in the same period a month earlier, according to Japan’s finance ministry. Analysts on average had forecast a surplus of 121.8 billion yen, according to Trading Economics.
Meanwhile, Japan’s services sentiment indicator rose 2.9 points in September from a month earlier, to a high since June of 48.4 points, according to Economy Watchers data.
Among the components of the index, the leaders of the fall were shares of electric motor manufacturer Nidec Corp. (-9.4%), automation equipment specialist SMC Corp. (-6.7%) and construction equipment manufacturer Hitachi Construction Machinery Co. Ltd. (-6.4%).
The Hong Kong Hang Seng fell 2.2%, while the Shanghai Shanghai Composite rose 0.2%.
The most significant fall in Hong Kong paper developers Country Garden Holdings Co. Ltd. (-6.8%), Longfor Group Holdings Ltd. (-8.2%) and Internet company Meituan (-7.2%).
Shares of Contemporary Amperex Technology Co. Ltd. (CATL) at the auction in Shenzhen rose by 6%. The country’s largest lithium-ion battery maker expects third-quarter net profit to more than double year-over-year, the company said in a statement.
TMS shares plunged 8.3% on the Taiwan Stock Exchange.
The South Korean index Kospi k decreased by 1.8%.
The value of shares of automaker Hyundai Motor fell by 4.3%.
Shares of Samsung, one of the world’s largest manufacturers of chips and electronics, fell 1.4%, while shares of its rival LG Electronics fell 4.3%.
The Australian S&P/ASX 200 fell 0.3%.
The capitalization of the world’s largest mining companies BHP and Rio Tinto fell by 0.4% and 0.6%, respectively.
Kyiv does not plan to make changes to the schedule for the start of the heating season, Mayor Vitaliy Klitschko said.
“Today, we do not plan any changes in the schedule. So far, heating is connected only at the request of the heads of social institutions. As for all others (household consumers), we will definitely take into account the weather conditions and will inform the people of Kiev about the connection to the central heating” , – Klitschko said on the air of the national telethon on Tuesday.
At the same time, Klitschko recommended that the people of Kiev prepare for the heating season, in particular, insulate windows in houses and porches, as well as purchase warm clothes.
“It’s better to play it safe and get ready. Warm clothes will not be superfluous this winter. We must calculate different developments, because Russian barbarians are trying to destroy the critical infrastructure of Ukrainian cities and towns,” Klitschko summed up.
Ukrainian ports on Monday left seven ships with almost 56 thousand tons of food, having received permission from the joint coordination center (JCC).
“On October 10, seven ships left Ukrainian ports, they are transporting a total of 55,750 tons of grain and other agricultural products as part of the Black Sea Grain Initiative,” the SKC said in a statement.
Five dry cargo ships – Basel Athena (19 thousand tons of wheat), Taj (10.5 thousand tons of corn), Islander A (7.2 thousand tons of wheat), Blue Shark (3.4 thousand tons of soybeans) and Jaguar (2.5 thousand tons of food) sailed to Turkey.
In addition, the Mehmet Bey ship will deliver 7.6 thousand tons of soybeans to Egypt. The Ekmen Trans vessel left for Israel with 5.5 thousand tons of rapeseed meal.
The SKC specified that “the grain that arrived at the destination can be processed and then transported to other countries.”
“As of October 10, the total tonnage of grain and other agricultural products exported from three Ukrainian ports is 6,868,748 tons. In total, 629 ships have been allowed to move at the moment – 320 for arrival in Ukrainian ports and 309 for leaving them,” – emphasized in the message.
On July 22, in Istanbul, with the participation of the UN, Russia, Turkey and Ukraine, a document was signed on the creation of a corridor for the export of grain from three Ukrainian ports – Chornomorsk, Odessa and Pivdenny.
Dynamics of changes in population of ukraine from 1991-2022
SSC of Ukraine , graphics of the Club of Experts
