Global Markets Update
- U.S. equity markets closed lower overnight, with the Dow Jones down -1.6%, S&P 500 down -2.0% and NASDAQ declining -2.8%, as investors remained reluctant to pile back into riskier assets after Fed Chair Jerome Powell and Treasury Secretary Janet Yellen both warned that a U.S. default due to a failure to raise the debt ceiling would have catastrophic consequences. U.S. consumer confidence dropped in September for a third straight month, suggesting concerns over the delta variant and higher prices continue to dampen sentiment.
- Long-dated U.S. treasury yields were higher, with the 2-Yr yield at 0.301% and the 10-Yr yield at 1.543%.
- European markets. European equity markets closed lower overnight, with the Stoxx Europe 600 down -2.2%, U.K. FTSE 100 down -0.5% and German DAX declining -2.1%. German consumer confidence for October rose to the highest level in almost a year and a half, amid rising income prospects and increased willingness to buy.
- Asian markets. Asian equity markets closed mixed overnight, with the Shanghai Composite up +0.5% and Hang Seng gaining +1.2%, after PBOC added a net 100bn yuan of liquidity into the banking system, the eighth day of injections and the longest streak since December. KOSPI was down -1.1% and Nikkei 225 closed -0.2% lower. Profit growth at China’s industrial firms continued to slow in August, declining -10.1% yoy, the slowest pace since September 2020, as high commodity prices pushed up costs while constraints including virus outbreaks and a chip shortage curbed production.
- WTI oil is trading at US$74.80 a barrel. Iron ore price is at US$105.77 per ton. Spot gold is trading at US$1,733 per oz.
ASX Market Update
- ASX performance. The ASX 200 closed -1.47% lower yesterday, after data revealed COVID-19 lockdowns continued to weigh heavily on Australia’s retailers, with retail sales dropping for a third straight month in August, declining -1.7% MoM to $29.3bn.
- Beach Energy Ltd (BPT) surged +10.5%, after maintaining FY22 capex forecast of A$900m-1.10bn and announcing it is targeting FY24 output of 28mmboe.
- Today’s trading. No major data is to be published.