2nd November 2022 Market Updates
FPG Fortune Prime Global Overnight headlines
The yield on the 10-year US Treasury note increased by one basis point to 4.05 percent.
Overnight reports revealed that the US still has a high unemployment rate while manufacturing activity has decreased. The report seemed to support the Fed’s decision to keep pushing interest rates higher in order to kerb persistent inflation.
Fed to lift
“Looking ahead, manufacturing will see more pain as demand weakens at home and overseas while inflation continues pretty high and interest rates remain elevated,” wrote Oren Klachkin of Oxford Economics in a note.
While disinflationary pressures are more apparent, according to Klachkin, inflation won’t return to pre-COVID trends very soon.
As a result, when its policy meeting ends on Wednesday, the Federal Reserve is still generally anticipated to raise its benchmark interest rate by 0.75 percentage points.
The question will be whether Fed Chair Jerome Powell and his colleagues even hint at slowing the rate of rate increases, as have the RBA, Bank of Canada, and ECB.
The afternoon trade on Wall Street saw declines in all three of the key benchmarks. Communication services and consumer discretionary led the six declining S&P 500 industry sectors. As the price of oil increased, energy led the gainers.
Other top stories
The Reserve Bank of Australia increased the official interest rate to 2.85 percent, Governor Philip Lowe offered a sombre warning about the dangers of excessive inflation.
As borrowing rates increase, distressed listing prices soar. Since May, the number of distressed listings has increased by more than 15% countrywide as more sellers struggle to make their dramatically increased mortgage payments.
- Bitcoin increased by 0.2% to $US20,458
- Australian dollars down 0.1% to 63.92 US cents
- The Dow fell 0.2% on Wall Street. S&P -0.4% -0.9% Nasdaq
- Stoxx 50 rose 0.9% in Europe. FTSE up 1.3%, CAC up 1% DAX +0.6%
- Brent crude increased by 2.1% to $94.71 per barrel,
- spot gold increased by 1% to $US1649.02/oz
- iron ore increased by 0.8% to $80.15 per tonne
- the 10-year yield was US 4.05%. Germany 2.13% Australia 3.76%
Local: September’s housing finance and building approvals, as well as information on private salaries, the unemployment rate, and employment change in New Zealand
Overseas data: ADP employment data for October in the US, Federal Reserve policy statement