Mohicans markets：Interest Rate Fears Weaken Risk Preference

MHM Todays News

In order to further meet the needs of investors for real-time news of the international market and broaden the channels for investors to understand the market,

MHMarkets ETA “Today's News” has been revised, and now “Today's News” is launched to provide investors with concise and real-time market information.

Today's Key Financial Data

☆15:15, European Central Bank President Lagarde delivered a speech on the geoeconomic issues of the United States and Europe.

☆ There are also a number of Fed officials speaking today. At 8:35, the 2024 FOMC voting committee and San Francisco Fed President Daly delivered a speech;

At 20:35, the 2024 FOMC voting committee and Atlanta Fed President Bostic will participate in a Q&A at an event;

At 22:10, the 2022 FOMC voting committee, St. Louis Fed President Bullard delivered a welcome speech at the community banking research conference hosted by the bank;

At 22:15, Federal Reserve Chairman Powell delivered a welcome speech at the Community Banking Conference;

The next day at 2:00, Chicago Fed President Evans will speak. Investors need to pay attention to their views on inflation and the Fed's subsequent rate hike path, with several Fed officials now saying the Fed will continue to raise interest rates.

Spot gold once rose to a high of $1,642.32 in intraday trading, but gave up most of the gains during the U.S. session and finally closed up 0.39% at $1,628.8 per ounce; spot silver finally closed up 0.22% at $18.38 per ounce.

The U.S. dollar index first fell and then rose. The US market once reached a high of 114.5, and finally closed up 0.07% at 114.18; the 10-year US bond yield also fell first and then rose, closing at 3.949%.

In terms of crude oil, the two crude oils rose sharply in the US market. WTI crude oil rose by more than 3% in the US market, and finally closed up 2.16% at US$77.95 per barrel; Brent crude oil finally closed up 2.13% at US$85.66 per barrel.

The Dow closed down 0.43%, falling below 29,000 points during the session, and the S&P 500 closed down 0.21%, falling below the June low and closing at a new low for the year. The Nasdaq closed slightly up 0.25%. Pharmaceutical stocks, education stocks, and new energy vehicle stocks fell. Xiaopeng Motors closed down about 5%, Li Auto closed down about 3%, and Weilai Automobile closed down about 2%.

European stocks closed down across the board. Germany's DAX index closed down 0.72% at 12,139.68 points, the UK's FTSE 100 index closed down 0.52% at 6,984.59 points, and the Euro Stoxx 50 index closed down 0.42% at 3,328.65 points.

In terms of cryptocurrencies, Bitcoin plunged by more than $1,000 in the U.S. market and fell to the $19,000 mark, while Ethereum dived with Bitcoin and narrowly stayed at the $1,300 mark.

Fed News

Chicago Fed President Evans said that if inflation improves, it may reduce interest rate hikes; Minneapolis Fed President Kashkari said that the Fed will not repeat the past mistakes of cutting interest rates once the economy weakens; St. Louis Fed President Bullard believes that the United States is facing serious inflation problems, the credibility of the Fed's inflation target is at risk, there will be more interest rate hikes in future meetings, and the policy rate may peak at around 4.5%.

The U.S. Senate on Tuesday cleared the way to discuss and pass an interim federal funding bill;

U.S. Treasury Secretary Janet Yellen has warned of economic disaster if the government does not intervene immediately on climate change; Federal Reserve Chairman Jerome Powell said that digital financial assets need proper regulation to ensure a level playing field and protect consumers; Chicago Fed President Evans said the Fed will need to raise interest rates to a range of 4.50% to 4.75% 

Market Hotspots

Europe investigates the leak of the Nord Stream gas pipeline, which many countries claim may have been sabotage; On Tuesday, Europe launched an investigation into a major leak in two Russian gas pipelines; 

Russia called on OPEC+ to cut oil production by 1 million barrels, and oil prices rose more than 3%;

On September 27, the worlds largest gold and silver ETF continued to reduce its holdings, of which gold was reduced by 2.61 tons and silver by 20.06 tons, and the trend of gold and silver capital outflows continued. 

Therefore, although gold rebounded slightly yesterday, the outflow of funds suggests that the rebound may not be sustainable, especially the current hawkish stance of the Federal Reserve.

Geopolitical Situation

Dmitry Medvedev, the former president of Russia and now the deputy chairman of the Russian Security Council, issued a new stern nuclear warning to Ukraine and the West on Tuesday;

The results of the referendum in four places in Ukraine were announced, and the approval rate for joining Russia was at least 87%, and the voter turnout exceeded the legal threshold;

Institutional Market Viewpoint

1. Nomura predicts that the pound may fall below parity by the end of the year, with a probability of up to 80%

2. Societe Generale: If the USDJPY falls below the 139.40 support, it may continue to decline in the short term

3. British broker Equiti Capital: Although Baileys speech has calmed the market, the pound is not out of the woods yet

4. ANZ: GBPUSD will continue to be under pressure in the short term

5. ANZ: The yen will continue to weaken, the dollar will hit 150 against the yen

6. Commerzbank: The Feds determination to fight inflation is the most important factor supporting the dollar

7. MUFG: Sterling is expected to remain volatile in the coming week

8. Commonwealth Bank of Australia: The Australian dollar may fall to 0.62 in the future

9. Commerzbank: The dollar grabs golds safe-haven demand

10. ANZ: Gold prices will fall to $1,620 by the end of the year

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