Key Market Insights September 9

9 min read

US Markets

Stock futures were flat overnight after markets regained some of their losses with a strong performance on Wednesday.

  • Wednesday was the best single-day performance for the three major indexes since August 10.
  • Despite the rebound, there seems to be a negative sentiment surrounding U.S. equities.
  • The current 10 Year US Treasury yield is set at 3.26930%
Market Price Move
Dow Jones 31,581.28 1.40%
S&P 500 3,979.87 1.83%
Nasdaq 11,791.90 2.14%
Russell 2000 1,832.00 2.21%

 

Canadian Markets

The Bank of Canada announced another 75-basis point interest rate increase on Wednesday.

  • Interest rates have now risen from 0.25% to 3.25% in 2022.
  • The Bank of Canada said the hike was due to the “effects of Covid-19 outbreaks, ongoing supply disruptions, and the war in Ukraine.”
  • Politicians and analysts have criticized the Bank of Canada, saying that the central bank has not been transparent with the general public and that it has failed to tame inflation.
  • Jimmy Jean, the Chief Economist at Desjardin, urged the Bank of Canada to “stop sugar coating” the Canadian economy and be transparent about the likelihood of a recession and the impact of policies such as quantitative easing, which he said are fueling inflation.
  • Former Conservative Party leader Andrew Scheer attacked the Bank of Canada for lying about printing more money during the pandemic to finance government spending and accused the central bank of being responsible for the current economic hardships. He said that it is only logical that since the Bank of Canada’s solution to the inflation crisis is to reverse its own policies, then those initial policies must have caused the inflation.
  • Central banks in other western nations have faced criticism in recent months over rising consumer prices.
Market Price Move
TSX 19,241.44 0.80%

 

European Markets

European markets were down on Wednesday following a downturn in U.K. equities.

  • Uncertainty over the new administration of Liz Truss, who took over as Prime Minister this week, is causing market volatility in the U.K.
  • The Stoxx 600 was down 0.4% on the day. Oil and gas stocks led losses with a 2.9% drop.
  • Utilities were among the few industries to make significant gains, jumping up 2.1%.
Market Price Move
Euro STOXX 50 3,502.09 0.06%
UK (FTSE 100) 7,237.83 -0.86%
Germany (DAX) 12,915.97 0.35%
France (CAC 40) 6,105.92 0.02%

 

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Asian Markets

Stocks in Asia were mostly down on Wednesday as investors remain concerned about the Fed’s policy decision later this month.

  • Chinese data showed exports rising 7.1% in August on an annual basis. This was significantly less than the 18% growth last month and the 12.8% jump projected by analysts.
  • Markets in Hong Kong were volatile throughout the day, gaining as much as 1% and losing as much as 1.5% during the session.
  • Stocks in mainland China were down more than 1% to start the day before rebounding to finish in the green.
Market Price Move
S&P Asia 50 4,323.76 -1.34%
Japan (Nikkei 225) 27,887.76 1.67%
South Korea (KOSPI) 2,383.77 0.31%
China (Hang Seng) 18,043.84 -0.00%
India (SENSEX) 59,028.91 -0.28%

 

Commodities

Oil prices were down on Wednesday, hitting a seven-month low.

  • Brent crude fell 5.2% to finish the day at just $88 per barrel.
  • US West Texas Intermediate crude lost 5.7% to finish the day at $81.94 per barrel.
  • Disappointing economic data from China, as well as rising COVID-19 cases, have caused concerns about the health of the Chinese economy.
  • China’s crude oil imports decreased by 9.4% year over year in August.
Market Price Move
Oil (NYSEARCA:OIL) 29.07 -5.89%
Gold (NYSEARCA:GLD) 159.94 1.02%
Silver (NYSEARCA:SLV) 17.00 2.78%
Corn (NYSEARCA:CORN) 26.83 -0.92%
Lumber (NASDAQ:WOOD) 74.25 0.91%

Currency Exchange Rates

The U.S. Dollar continues to climb, strengthened by expectations that the Fed will be aggressive in getting inflation back to its 2% target.

  • The U.S. Dollar hit a 24-year high against the Japanese Yen and a 37-year high against the UK pound sterling.
  • The Canadian Dollar was largely unchanged against the U.S. Dollar despite the interest rate hike by the Bank of Canada.
Market Price Move
UK(GBP) £0.87 0.50%
Europe (EURO) €1.00 -0.38%
Canada (Canadian Dollar) $1.31 0.03%
Japan (Yen) ¥144.08 2.59%

 

Cryptocurrency

Bitcoin and Ethereum both faced some volatility on Wednesday, with prices varying throughout the day.

  • Bitcoin’s trading volume remains lower than expected, while Ethereum’s trading volume was above its 20-day moving average.
  • Bitcoin’s prices are down 59% year to date, while Ethereum’s value has dropped by 58% year to date.
  • Analysts expect that cryptocurrency prices will continue to decline as the U.S. Dollar strengthens.
Market Price Move
Bitcoin $19,235.80 -2.82%
Ethereum $1,620.72 3.85%
Litecoin $56.59 4.54%
Bitcoin Cash $117.71 -6.39%

 

Good trading,
Chris Svorcik

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