đMarket Performance
đU.S. stocks fell across the board:
- The Dow Jones Industrial Average fell 0.41%, the Nasdaq fell 1.53%, the S&P 500 fell 0.93%, and the Russell 2000 fell 1.48%.
- The 2-year Treasury yield fell 2.6 basis points to 3.615%, and the 10-year Treasury yield fell 4.1 basis points to 3.738%.
- The US dollar index rose 0.44% to 101.2063, and the VIX rose 15.12% to 19.26.
- Brent crude oil rose 3.86% to 74.47. London gold rose 1.10% to 2663.050.
đChinese stocks generally rose:
- USD/CNH rose 236 basis points to 7.0302.
- The Nasdaq China Golden Dragon Index rose 5.48%, Pinduoduo rose 8.03%, Alibaba rose 6.23%, JD.com rose 7.33%, NetEase rose 3.35%, Li Auto rose 11.50%, Xpeng Motors rose 5.58%, and NIO rose 5.31%.
đA-shares and Hong Kong stocks are closed
đEuropean stocks mixed:
- The UK FTSE 100 rose 0.48%, the French CAC40 fell 0.81%, and the German DAX fell 0.58%.
- EUR/USD fell 0.60% to 1.1068.
đJapan, South Korea and emerging markets rose and fell:
- Nikkei 225 rose 1.93%, South Korea's Composite Index was closed, India's SENSEX30 fell 0.04%, Indonesia's Composite Index rose 1.52%, Vietnam's Ho Chi Minh Index rose 0.33%, Mexico's MXX fell 0.57%
đđFocus on
đThe situation in the Middle East escalates, Iran missiles attack Israel, no casualties reported so far, beware of Israel's counterattack against Iran, risk aversion increases, oil prices soar
- The IDF said Iran fired missiles at Israel. On October 1, local time, the IDF issued a statement saying that missiles were fired from Iran into Israel. Alarms sounded in Jerusalem. The statement said that Israel's air defense system was fully operational.
- Iran claims that launching missiles at Israel is a legitimate defense. On the evening of October 1, local time, Iran's Islamic Revolutionary Guard Corps issued a statement on launching a large-scale missile attack on Israel. The statement said that after a long period of self-restraint, after the assassination of Hamas leader Haniyeh, Iran conducted this legitimate defense in response to the killing of Haniyeh, Lebanese Hezbollah leader Nasrallah, and senior generals of the Revolutionary Guard Corps by Israel, so Iran launched missiles at Israel. Iran warned that if Israel retaliates against Iran's legitimate defense, it will suffer a devastating blow. "Unless the Israeli regime decides to take further retaliatory actions, our actions will end" - Iranian Foreign Minister said on X
- Israel's Netanyahu says Iran will pay for missile attack
đUS August JOLTs job vacancies (10,000 people) announced value 804, expected 766, previous value 771.1 (767.3 revised up)
The US September ISM Manufacturing PMI was released at 47.2, expected to be 47.5, and the previous value was 47.2
The final value of the US Markit Manufacturing PMI in September was 47.3, the initial value was 47.
âïžComment: The newly released August job vacancies and September manufacturing PMI show that the general trend of weakening employment and manufacturing has not changed. More attention should be paid to Friday's non-farm payrolls to see if there will be a rate cut. Considering Powell's advance warning, a 25 basis point rate cut in November is more likely.
Although the number of job vacancies in August slightly exceeded expectations, the data lagged by one month, mainly showing the recovery of some jobs after the hurricane, especially the breakdown of the data shows that the overall weakening trend of the labor market remains unchanged. From a breakdown structure perspective, the industries with the largest increase in the number of job vacancies are construction, transportation, warehousing and utilities, and state and local governments (excluding education), and the number of job vacancies in many service industries is decreasing. The ratio of job vacancies to the number of unemployed people in August was 1.1, continuing to be lower than the 1.2 before the epidemic. The number of people who voluntarily resigned in August fell to 3.084 million, a four-year low. Combined with the continued month-on-month decline in employment in the manufacturing PMI in September, the overall trend of cooling employment has not changed. Pay attention to the performance of the non-agricultural data in September this Friday.
The US manufacturing industry remained sluggish in September, waiting for stimulus from the continuous interest rate cuts. Although the demand for new orders in September slightly recovered, up 1.5 percentage points month-on-month, it was still below the boom-bust line; the US economy is currently mainly supported by the service industry, and the manufacturing PMI will be released on Thursday.
đThe U.S. port strike has officially begun. In the early hours of Tuesday morning, dock workers began the first large-scale strike in nearly 50 years, bringing about half of the country's ocean shipping to a standstill. Analysts at the Oxford Economics Institute said the strike would cause economic losses of up to $4.5 billion to $7.5 billion per week, affecting the U.S. GDP by 0.1%. JPMorgan analysts estimated that the strike could cause losses of up to $5 billion a day, but did not expect the strike to last more than a week. European automakers are most vulnerable to the U.S. dock workers' strike; in addition, retailers say they can withstand the impact of a short-term dock workers' strike, but if the strike is prolonged, prices may rise and commodity shortages may worsen.
âïžComment: Pay attention to the duration of the strike and its impact on inflation in October-November
đ Eurozone CPI rose 1.8% year-on-year in September, in line with expectations and up from 2.2% in the previous month; it fell 0.1% month-on-month, in line with expectations and up from 0.1% in the previous month.
The Eurozone's core CPI rose 2.7% year-on-year in September, in line with expectations and up from 2.8% in the previous month. It rose 0.1% month-on-month and up from 0.3% in the previous month.
âïžComment: The euro zone's CPI in September was basically in line with expectations, and inflation continued to be in a downward channel, which strengthened the reasons for the euro zone to cut interest rates on October 17 and supported two 25 basis point interest rate cuts in the euro zone this year.
đJapanese Prime Minister and new cabinet members continue to send dovish signals
Japanese Prime Minister Shigeru Ishiba held his first press conference since taking office, saying he hopes to maintain loose monetary policy. Ishiba said the Japanese economy is on the verge of defeating deflation, and we will conduct economic and fiscal management to prioritize ensuring this goal. I hope that loose monetary policy can continue as a trend. I will not comment on interest rates, but I hope the Bank of Japan will maintain its current stance to help us defeat deflation. I will instruct the cabinet to formulate a new package of measures to ease the impact of rising living costs on households, such as providing subsidies to low-income households.
Incoming Economic Revitalization Minister Ryomasa Akazawa said the Bank of Japan should be cautious when considering further rate hikes to ensure that Japan truly defeats deflation. I hope the Bank of Japan will be careful in its judgment and we must not cool the economy in any way at this moment. My idea is that defeating deflation should be the top priority.
đThe Chinese and American Ministers of Commerce will hold a phone call soon. The Chinese and American Ministers of Commerce will hold a phone call in the near future to exchange in-depth views on Sino-US economic and trade relations and economic and trade issues of key concern to both sides, including restrictions on electric vehicles that are of general concern to all parties. This call is a mechanism-based dialogue and communication between the two countries' business departments.
đ Today's Key Events
- 20:15 PM US September small non-farm payrolls, expected to be 125,000, previous value 99,000\
