On Tuesday (September 26th), as confidence in the economy stagnated and investors began to consider a long-term high interest rate environment, the US stock market fell to its lowest level since early June. The US dollar continued its rise for the fifth consecutive day, with a daily record of six consecutive positive days. After a report showed that consumer confidence in the world's largest economy fell to a four month low, both the S&P 500 index and the Nasdaq 100 index fell 1.5%. The panic index VIX on Wall Street continues to rise, reaching its highest level since the end of May. The Morgan Stanley Capital International Global Index, one of the most widely used indicators to measure global stock markets, has fallen for the eighth consecutive day, setting a record for the longest consecutive decline in the past decade.
Quincy Krosby, Chief Global Strategist at LPL Financial, said, "The market is currently in the hands of bears. There is concern and uncertainty hanging over the market. Selling is not very drastic, in fact, they are orderly
Gold and silver prices have fallen and continued to hit recent lows. In December, gold fell by $15.10 to $1921.50, while silver fell by $0.23 to $23.145.
In the foreign exchange market, the euro/dollar fell for the third consecutive day, reaching a new low of 1.0563 since March. The Canadian dollar performed strongly yesterday, but the gains disappeared today. The pound followed the weakness of the stock market during the fifth day of selling. GBP/USD hit its lowest point since mid March at 1.2155.
Data shows that the consumer confidence index has dropped from a revised 108.7 in August to 103, lower than the median 105.5 surveyed by Bloomberg economists. Another report also showed that new home sales in the United States fell short of expectations in August. According to the US Department of Commerce, the total number of contracted properties this month was 675000, a decrease of 8.7% from July. Economists surveyed by Dow Jones estimate a total of 695000, a decrease of 2.7% from the uncorrected total for July.
Costco Wholesale's quarterly report shows that comparable sales are mostly lower than analysts' expectations, indicating that shoppers are cutting back on discretionary expenses.
Stephen Stanley, Chief US Economist at Santander Bank, wrote: "In recent months, consumers' reactions to inflation and gasoline prices seem to be more sensitive than normal. Although the Federal Reserve primarily focuses on core issues, ordinary consumers spend a significant portion of their budget on food and energy purchases and are unwilling to ignore these price increases
US treasury bond bond yields rebounded after hitting a 10-year high on Monday. The auction rate of two-year treasury bond worth US $48 billion was 5.085%, the highest level since 2006. The Bloomberg dollar index rose to its strongest closing price since early December last year. The oil price has resumed its rise, returning to above $90 per barrel.
Technology giants such as Apple, Microsoft, Amazon, and Google's parent company Alphabet dragged down the US stock market, driving the technology sector down more than 10% from its July high. The threat of tightening policies is offsetting some of the biggest gains in the rapidly developing technology stocks in the market this year. These growth companies are valued for their long-term prospects, but their attractiveness weakens when future profits are discounted at higher interest rates. Over the past week, multiple Fed spokespersons have issued emphasized messages that if the economy is stronger than expected, they will maintain tightening policies for a longer period of time. Minneapolis Federal Reserve Bank President Neil Kashkari has stated that he expects the Federal Reserve to need to raise interest rates again this year.
Paul Nolte, Senior Wealth Manager at Murphy&Sylvester Wealth Management, wrote in a report: "Investors are beginning to realize that a long-term high interest rate environment is a possible outcome and are slowly adapting to the new normal. For several months, a long-term rise has been the slogan of the Federal Reserve. However, it was not until recently that the market began to believe their statements
Jamie Dimon, CEO of JPMorgan Chase, warned that interest rates may need to rise further to curb inflation, exacerbating bearish sentiment on Tuesday.
Oil prices closed nearly 1% higher, rebounding after hitting a two-week low earlier, with expectations of supply tightening overshadowing concerns that the uncertain economic outlook will dampen demand. Brent crude oil futures closed up $0.67, or 0.7%, at a settlement price of $93.96 per barrel. US crude oil futures closed up 0.71 US dollars, or 0.8%, at settlement price of 90.39 US dollars.
Focus on financial data and events on Wednesday (Beijing time)
① 09:30 Australia's August non seasonally adjusted CPI annual rate
② 14:00 German October Gfk Consumer Confidence Index
③ 16:00 Swiss September ZEW Investor Confidence Index
④ 20:30 Monthly rate of durable goods orders in the United States in August
⑤ 22:30 EIA crude oil inventory for the week from the United States to September 22, and EIA strategic oil reserve inventory for the week from the United States to September 22
Analysis of Major Currency Trends
EUR: EUR/USD fell, closing at 1.0572, a decrease of 0.20%. Technically, the initial resistance to the upward trend of the exchange rate is at 1.0597, the further resistance is at 1.0626, and the key resistance is at 1.0644; The initial support for the downward trend of the exchange rate is at 1.0549, further support is at 1.0531, and more critical support is at 1.0502. GBP: GBP/USD fell to close at 1.2157, a decrease of 0.44%. Technically, the initial resistance to the upward trend of the exchange rate is at 1.2199, the further resistance is at 1.2239, and the key resistance is at 1.2263; The initial support for the downward trend of the exchange rate is at 1.2135, further support is at 1.2111, and more critical support is at 1.2072. JPY: USD/JPY up, closing at 149.055, up 0.12%. Technically, the initial resistance to the upward trend of the exchange rate is at 149.208, further resistance is at 149.443, and the key resistance is at 149.698; The initial support for the downward trend of the exchange rate is at 148.718, further support is at 148.463, and more critical support is at 148.228.
