NEWSLETTER
Thursday / September 29Sep 29
Market News: Kick Start Monday
Today, leaders of the European Union countries start a special meeting in Brussels, which will last two days, to discuss the war in Ukraine and put defense, inflation, energy and food security on the agenda.
US dollar slipped for a third day versus major currency pair as havens lost their appeal amid the improved mood. Oil traded near $116 a barrel as the European Union failed to agree on a revised package of Russian sanctions, which will be the sixth one namely. Cash Treasuries weren’t trading because of the US Memorial Day holiday.
Traders are pondering whether the bottom of the selloff is near as investors have been buying the dip after one of the worst starts to the year for equities. However, a wall of worries remains from hawkish central banks underscoring fears of a recession, escalating food inflation from the war in Ukraine and China’s lockdowns stunting economic activity.
China’s yuan outperformed after the Chinese officials reported Covid-19 cases in the most crowded cities of the country, Beijing and Shanghai, are in a downward trend. As a result, we observed that the Chinese government started to ease some of the restrictions and lockdown measures in order to stimulate sagging growth. Chinese stocks had more modest gains as reopening plans sparked advances in some sectors like consumer and travel.
We can say that we are in the middle of a bear market rally. The market is going to be trading range bound trying to figure out how soon that recession is coming or how quickly inflation is going down. In addition, US Treasury yields are highly likely to peak this year.
Traders will be looking to the US payroll numbers later this week to gauge the Federal Reserve’s tightening path as it strives to rein in inflation. Meanwhile, the Fed is set to start shrinking its $8.9 trillion balance sheet starting Wednesday.
US dollar slipped for a third day versus major currency pair as havens lost their appeal amid the improved mood. Oil traded near $116 a barrel as the European Union failed to agree on a revised package of Russian sanctions, which will be the sixth one namely. Cash Treasuries weren’t trading because of the US Memorial Day holiday.
Traders are pondering whether the bottom of the selloff is near as investors have been buying the dip after one of the worst starts to the year for equities. However, a wall of worries remains from hawkish central banks underscoring fears of a recession, escalating food inflation from the war in Ukraine and China’s lockdowns stunting economic activity.
China’s yuan outperformed after the Chinese officials reported Covid-19 cases in the most crowded cities of the country, Beijing and Shanghai, are in a downward trend. As a result, we observed that the Chinese government started to ease some of the restrictions and lockdown measures in order to stimulate sagging growth. Chinese stocks had more modest gains as reopening plans sparked advances in some sectors like consumer and travel.
We can say that we are in the middle of a bear market rally. The market is going to be trading range bound trying to figure out how soon that recession is coming or how quickly inflation is going down. In addition, US Treasury yields are highly likely to peak this year.
Traders will be looking to the US payroll numbers later this week to gauge the Federal Reserve’s tightening path as it strives to rein in inflation. Meanwhile, the Fed is set to start shrinking its $8.9 trillion balance sheet starting Wednesday.
