Holidays in U.S., Japan, and Canada But No Respite for Equity Market Weakness
October 10, 2022
China emerged from a full-week holiday to experience a 1.7% drop in equity prices. Stock markets also fell 1.4% in Australia and Taiwan, 3.0% in Hong Kong, and 1.2% in Singapore. Japan observed Health and Sports Day, and the U.S. and Canada are observing Columbus Day and Thanksgiving Day, respectively. There will be not bond market trading because U.S. banks are closed, but stock markets, which tumbled Friday, will be open. U.S. equity futures are modestly lower. The German Dax is firmer, but share prices have moved down in the U.K., France, Spain and Italy.
A substantial 3% drop in the Russian MOEX added on to Friday’s huge drop. President Putin escalated his war on Ukraine with missile attacks on several cities all over that country.
The ten-year British gilt yield leaped 17 basis points so far today and is just 11 basis points below the 4.5% peak touched recently.
The weighted DXY dollar index has strengthened 0.3% so far today and may be positioning for a test of last month’s 20-year peak. The greenback has risen today by 0.8% versus the Australian dollar, 0.5% against the euro, 0.4% against the kiwi, yuan, and Swiss franc, and 0.3% relative to sterling.
Bitcoin remains below $20k and is down 0.3% today. The price of gold sank 1.4%, and WTI oil is 0.7% softer.
Annual meetings of the World Bank and IMF kick off today in Washington and will run all week. They can be visited in person or virtually.
More evidence of excessive inflation was reported this Monday.
- Norwegian CPI inflation of 6.9% in September rose to a 410-month high of 6.9% from 6.5% in August and 4.1% a year earlier. Core CPI inflation of 5.3% was at a record high and more than twice its targeted pace.
- A 7.2% monthly pull-back in Norwegian producer prices after jumps of 7.5% in July and 8.2% in August reduced the 12-month rate of PPI increase to a 13-month low of 52.4% last month.
- Danish CPI inflation catapulted 1.1 percentage points higher in September to a 478-month high of 10.0% and dwarfed the September 2021 rate of 2.2%.
- Greek CPI inflation revived from 11.4% in August to 12.0% in September, just 0.1 percentage point less than June’s 297-month high of 12.1%.
- Moldovian CPI inflation of 34.0% in September was up from 6.7% a year earlier, and Lithuanian CPI inflation climbed further to a 313-month high of 24.1% from 22.4% in August and 6.3% in September 2021.
The Irish construction purchasing managers index improved sharply for a second straight month to a 4-month high of 50.2 in September from 46.9 in August and a 16-month low of 41.8 in July. 50.2 still signifies near stagnation.
The AIG-compiled service sector Australian purchasing managers index fell to an 11-month low last month of 48.0 after printing at 53.3 in August. Officials have sought to take some steam out of the housing market.
The Sentix measure of investor sentiment toward the euro area economy dropped to -38.3 this month, a 29-month low and down from -31.8 in September. This was the fifth lowest reading ever.
Consumer confidence in Indonesia weakened from a record high last May to a 5-month low in September.
Turkish unemployment fell to a 113-month low of 9.6% in August.
The State Bank of Pakistan paused interest rate tightening at its latest policy review. At 15.0% currently, such is at the highest level since April 1999 and eight full percentage points above its pandemic low of 7.0%, which prevailed from June 2020 until September 2021. Pakistani CPI inflation had slowed to a 7-month low of 23.2% in September from a 567-month high of 27.3% in the prior month.
Copyright 2022, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
Tags: MOEX, Norwegian and Danish consumer prices, State Bank of Pakistan
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