Key Market Insights October 26

9 min read

US Markets

Stock futures are flat overnight after a slightly positive session on Monday.

  • Stock performance this week will largely depend on the earnings of Big Tech companies, starting with Alphabet and Microsoft today. Meta will report earnings tomorrow and Amazon and Apple on Thursday.
  • Amazon is down overnight following reports that the company is instituting a hiring freeze to deal with rising costs.
  • The current 10 Year U.S. Treasury yield is set at 4.21740%
Market Price Move
Dow Jones 31,499.62 1.34%
S&P 500 3,797.34 1.19%
Nasdaq 10,952.61 0.86%
Russell 2000 1,748.40 0.35%

 

Canadian Markets

The Bank of Canada is expected to increase interest rates on Wednesday despite serious concerns about the health of the country’s economy.

  • Investors currently believe there is a 50% chance of a 50-basis point interest rate hike and a 50% chance of a 75-basis point interest rate hike.
  • The bank has already risen interest rates for five months in a row.
  • Canada’s Finance Minister warned that regardless of the size of the hike: “Mortgage payments will rise. Business will no longer be booming. Our unemployment rate will no longer be at its record low.”
Market Price Move
TSX 18,918.40 0.30%

 

European Markets

European markets were higher on Monday, reacting positively to the news that Rishi Sunak is set to be the next Prime Minister of the United Kingdom.

  • Sunak is viewed positively by investors as he was the finance minister during the pandemic and instituted many well-received policies by markets and the public.
  • Sunak comes from a business background, having worked at Goldman Sachs as an investment banker before leaving to be a partner at his own hedge fund.
  • The Stoxx 600 was up 1.4% on Monday led by retail stocks, which gained 2%.
Market Price Move
Euro STOXX 50 3,527.79 1.47%
UK (FTSE 100) 7,013.99 0.64%
Germany (DAX) 12,931.45 1.58%
France (CAC 40) 6,131.36 1.59%

 

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Asian Markets

Stocks in Asia were up early on Tuesday after a significant drop on Monday.

  • Stocks in China are seeing significant sell-offs after the Chinese government released economic data a week later than scheduled.
  • China’s gross domestic product increased by 3.9% in the third quarter compared to the same time last year, below the government’s growth target of 5.5%.
  • Chinese stocks have lost more than 50% on average in the past 12 months.
  • The Nasdaq Goldman Dragon China Index reached its lowest point ever following a 20% drop on Monday.
Market Price Move
S&P Asia 50 3,495.06 -4.05%
Japan (Nikkei 225) 27,180.64 0.76%
South Korea (KOSPI) 2,248.49 0.55%
China (Hang Seng) 15,180.69 -6.36%
India (SENSEX) 59,831.66 0.88%

 

Commodities

Oil prices were volatile on Monday as investors remain concerned about declining business activity in the U.S. and slow growth in China.

  • In September, China imported 9.79 million barrels of oil, a 2% drop versus the same month last year.
  • Brent crude was down 0.03% on Monday, and U.S. West Texas Intermediate lost 0.24%.
  • The U.S. has confirmed the release of another 15 million barrels of oil from the country’s Strategic Petroleum Reserves.
Market Price Move
Oil (NYSEARCA:OIL) 30.58 -0.42%
Gold (NYSEARCA:GLD) 153.65 -0.32%
Silver (NYSEARCA:SLV) 17.68 -0.45%
Corn (NYSEARCA:CORN) 27.21 -0.22%
Lumber (NASDAQ:WOOD) 69.88 -0.14%

 

Currency Exchange Rates

The U.S. Dollar rose slightly on Monday despite strong momentum behind other currencies.

  • The dollar gained 0.01% against the six largest fiat currencies.
  • The British Pound saw a significant surge in response to Sunak becoming the leader of the Conservative Party and the incumbent Prime Minister.
  • The Euro was also up following negative economic news from China.
Market Price Move
UK(GBP) £0.88 -0.09%
Europe (EURO) €1.01 -0.32%
Canada (Canadian Dollar) $1.37 0.27%
Japan (Yen) ¥148.95 0.85%

 

Cryptocurrency

Bitcoin’s stability continues and the cryptocurrency has now gone through the least volatile 60-day trading period since the start of the pandemic.

  • The token price of a dogecoin-related project has tripled in the last seven days.
  • After adding Aave and Tezos to its platform, Robinhood now offers a total of 19 cryptocurrencies.
  • Peter Brandt, the founder and CEO of proprietary trading firm Factor LLC, predicted that Bitcoin will hit a new all-time high in 3 years but could go as low as $13K before it climbs up again.
Market Price Move
Bitcoin $19,280.30 0.38%
Ethereum $1,338.68 -1.86%
Litecoin $52.56 -2.72%
Bitcoin Cash $107.94 -0.59%

 

Good trading,
Chris Svorcik

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