North American News
US major indices erase the gains from yesterday. Close sharply lower
- NASDAQ index loses over 2.84%
The major US indices fell sharply with both the S&P index and the NASDAQ index erasing the gains from yesterday.
The Dow industrial average fell sharply but declines were less vs. the gains yesterday.
- The S&P 500 closed at the lowest level since November 2020.
- Two Dow stocks were higher: Travelers and Visa
- Apple shares of fell around $-7.29 or -4.84% and is closing below its 100 week moving average at $146.01. The closing level is at $142.52. Bank of America downgraded the stock to neutral from buy
- Major averages are negative on the week heading into the final day tomorrow
- NASDAQ lower for the 1st time in 3 trading days
The final numbers are showing:
- Dow industrial average fell -456.17 points at -1.54% at 29227.58. The index fell rose 1.88% yesterday
- S&P index fell -78.33 points or -2.11% at 3640.69. Yesterday the index rose 1.9%
- NASDAQ index fell -314.12 points or -2.84% at 10737.52. Yesterday the index rose 2.05%
- Russell 2000 fell -40.31 points or -2.35% at 1674.93. The index rose by 3.17% yesterday
Bullard: I pay attention to market-based measure of inflation expectations
- I pay a lot of attention to market-based measures of inflation expectations such as TIPS and swaps
- There’s a risk management emphasis, which means we need to stay higher for longer
- We will push inflation to 2% in a reasonable compact time frame
- It’s a totally bad idea to mess around with inflation target
- Real rates into positive territory is an encouraging sign
- Fed is going to have to be careful on not over-interpreting a decline in inflation as it moves back to 2%
- We will probably need ‘higher for longer’ on rates than markets anticipated previously
Commodities
WTI crude oil futures are settling at $81.23
- Price is down 92 cents or -1.12%
The price of WTI crude oil futures are settling at $81.23. That is down $0.92 or -1.12%. The low for the day reached $80.35. The high for the day reached $82.92.
Gold ticks down amid dollar recovery and increasing yields – TDS
Gold has failed to build on Wednesday’s gains as US yields have reversed back higher. Economists at TD Securities expect the yellow metal to remain under pressure as the US dollar is also in demand.
Capitulation risk is growing
“After a brief period of relief, recovery in the USD and increasing yields have started to weigh on precious metals once again.”
“The risk of capitulation remains prevalent for the yellow metal moving into October with key labour market and inflation data on tap before the next Fed meeting.”
“With prices trading below pandemic-era levels, a small number of family offices and proprietary trading shops are increasingly feeling the pressure to finally capitulate on their massively bloated and complacent length in gold.”
“The combination of surging real rates and USD, continued outflows from money managers and ETF holdings are all adding pressure on family offices and prop shops to finally capitulate on their length.”
Aluminium to suffer a substantial drop on a brean under $2,000 – Credit Suisse
Aluminum (LME) remains capped by its 55-day moving average (DMA), currently seen at $2,355, and is establishing fresh YTD lows. Strategists at Credit Suisse stay biased towards further weakness.
Aluminum remains in a clear downtrend
“We identify the next significant medium-term support at the 78.6% retracement of the 2020/2022 uptrend and key psychological mark at $2,015/2,000. In case this long-term support area would break as well, we then identify next key supports at the $1,945 January 2021 low and then the October 2020 low at $1,725.”
“Above the 55-DMA, currently at $2,355, would stabilize Aluminum in the short-term, but above the 200-DMA, currently seen at $2,830, is needed for a more profound medium-to long-term stabilization, which is not our base case.”
EU News
European equity close: Another day, another drop
Closing changes in Europe:
- Stoxx 600 -1.6%
- UK FTSE 100 -1.8%
- German DAX -1.9%
- French CAC -1.7%
- Italy MIB -2.3%
- Spain IBEX -2.6%
Other News
Kremlin to annex four regions in Ukraine tomorrow and Putin will deliver a speech
- That raises risks into the weekend
Putin is set to deliver a speech tomorrow at 3 pm Moscow time, which is 8:30 am in New York and 1:30 pm in London. The pipeline bombing is also deeply concerning and could be a pretext for a broader hybrid energy war from Putin
Cryptocurrency News
Bitcoin moves back around the $19,000 level and also below the 100/200 hour MAs
- Technicals tilt back to the downside
Looking at the daily chart, the rally early this week to the price back toward a downward sloping trendline going all the way back to December 2021, but the rally stalled ahead of that level. The price also remains below its 100 day moving average. The trend line currently comes in at around $20,300 and moving lower. The 100 day moving averages at $21,201.44. It would take moves above those levels to give the buyers some comfort. Absent that than the sellers remain in control.