Daily global market review
The market ended the day in negative territory, primarily influenced by increasing market rates triggered by this morning's data and relatively disappointing results from a bond auction. Earlier in the session, the market saw some strength in mega-cap stocks, leading the S&P 500, Nasdaq Composite, and Dow Jones Industrial Average to trade up by 0.3%, 0.4%, and 0.2%, respectively, at their peak levels.
However, several mega-cap stocks reversed course as another wave of selling hit the Treasury market in conjunction with the completion of a $20 billion 30-year bond auction, which encountered poor demand. The 2-year note yield, previously at 4.97% before the Consumer Price Index (CPI) data, rose by six basis points to 5.06%, and the 10-year note yield, which had reached 4.53% before the CPI data, surged by 12 basis points to 4.71%.
The total CPI remained unchanged at 3.7% year-over-year, with core CPI (excluding food and energy) decreasing to 4.1% year-over-year from 4.3% in August. Meanwhile, initial jobless claims remained consistent at 209,000, reflecting a tight labor market. However, these reports failed to alleviate concerns about potential future rate hikes.
Geopolitical uncertainties, as well as a strengthening dollar (with the U.S. Dollar Index rising by 0.7% to 106.58), also loomed over the market. Some major mega-cap stocks, including Apple, Amazon, and NVIDIA, held onto their gains, providing essential support to the major indices. The S&P 500, weighted by market capitalization, fell by 0.6%, whereas the Invesco S&P 500 Equal Weight ETF (RSP) dropped by 1.3%.
Of the 11 S&P 500 sectors, nine closed in negative territory, with materials, utilities, and real estate sectors experiencing the most significant declines. In contrast, the information technology and energy sectors saw the most significant gains.
In comparison, the Russell 2000 underperformed relative to other major indices, with a 2.2% drop, pushing the index into negative territory for the year (-1.5%).
Examining today's economic data, the total CPI increased by 0.4% month-over-month in September, with core CPI rising by 0.3%. Notably, more than half of the increase in total CPI was driven by a 0.6% rise in the index for shelter. On a year-over-year basis, the total CPI remained at 3.7%, while core CPI decreased to 4.1% from August's 4.3% for the 12 months ended in August.
An essential point to note is that the headline figures mask some encouraging inflation readings below the surface. Specifically, the all items index, excluding shelter, increased by just 2.0% year-over-year, and the services index, excluding rent of shelter, rose by 2.8% year-over-year.
In the labor market, initial jobless claims for the week ending October 7 remained steady at 209,000, while continuing jobless claims for the week ending September 30 increased by 30,000 to 1.702 million. These figures reflect a tight labor market, which continues to work in favor of the economy.
In summary, the stock market faced headwinds as rising market rates and the lackluster bond auction results raised concerns about future rate hikes. Geopolitical uncertainty and a strengthening dollar added to the market's woes, although some mega-cap stocks helped limit the overall downside.
In the United States, the Dow currently stands at 33,631.14, showing a decline of 173.73 points, equivalent to a 0.51% decrease. The S&P 500 is at 4,349.61, down by 27.34 points, indicating a 0.62% decrease. The NASDAQ is recorded at 13,574.22, experiencing a drop of 85.46 points, representing a 0.63% decrease. Meanwhile, the VIX volatility index stands at 16.69, marking an increase of 0.60 points, which signifies a 3.73% rise. The Russell 2000 is at 1,734.25, with a decline of 39.04 points, indicating a 2.20% decrease. In Canada, the S&P/TSX Composite is listed at 19,500.24, showing a decrease of 163.60 points, a 0.83% decrease, while the S&P/TSX 60 is at 1,172.81, with a decrease of 8.33 points, marking a 0.71% decrease. In Brazil, the BOVESPA is recorded at 117,050.74, with no change. In Chile, the S&P IPSA stands at 5,800.22, with an increase of 19.26 points, representing a 0.33% rise, and in Mexico, the S&P/BMV IPC is at 49,745.16, experiencing a decrease of 599.58 points, equivalent to a 1.19% decrease.
In Europe, the STOXX Europe 50 is currently at 3,973.10, showing an increase of 10.96 points, a 0.28% rise, while the STOXX Europe 600 stands at 453.63, with an increase of 0.47 points, marking a 0.10% increase. In the United Kingdom, the FTSE 100 is listed at 7,644.78, with an increase of 24.75 points, equivalent to a 0.32% rise. In Italy, the FTSE MIB is at 28,493.35, with an increase of 74.29 points, indicating a 0.26% rise, while in France, the CAC 40 is at 7,104.53, down by 26.68 points, representing a 0.37% decrease.
In Japan, the Nikkei 225 currently stands at 32,494.66, showing an increase of 558.15 points, equivalent to a 1.75% rise. In Hong Kong, the Hang Seng is at 18,238.21, with an increase of 345.11 points, marking a 1.93% increase, and in China, the Shanghai Composite is listed at 3,107.90, with an increase of 28.95 points, a 0.94% rise. In Australia, the S&P/ASX 200 stands at 7,091.00, with no change. In South Korea, the KOSPI is recorded at 2,479.82, showing an increase of 29.74 points, equivalent to a 1.21% rise. In Taiwan, the Taiwan SE is at 16,825.91, with an increase of 153.88 points, representing a 0.92% rise.
In the latest market update for India, a range of indices reflected various movements. The BSE MidCap index edged up by 0.30% to close at 32,322.73, while the BSE Sensex saw a slight decline of -0.10%, finishing at 66,408.39. On the other hand, the BSE SmallCap index exhibited more strength, with a 0.60% increase, reaching 38,198.50. Market volatility, as measured by the India VIX, decreased by -3.35% to 10.6175, suggesting a more stable trading environment. Within the NIFTY indices, the NIFTY Smallcap 100 displayed resilience, registering a 0.65% increase, closing at 12,950.95. However, the Nifty 50 Value 20 experienced a modest decline of -0.41%, reaching 10,480.55. These divergent movements were reflected in the S&P BSE indices, where the S&P BSE ALLCAP exhibited a slight increase of 0.13%, closing at 8,025.52. Conversely, the S&P BSE-100 reported a minor decrease of -0.02%, finishing at 20,278.75, while the S&P BSE-200 inched up by 0.01%, closing at 8,666.66.
As for cryptocurrencies, the Nasdaq Crypto Index is at 1,501.67, down by 10.89 points, marking a 0.72% decrease. Bitcoin is priced at 26,722.00, showing a decrease of 115.00 points, equivalent to a 0.43% decrease. Ether is currently at 1,535.40, with a decrease of 28.60 points, indicating a 1.83% decrease. Litecoin is at 60.80, down by 0.70 points, representing a 1.14% decrease, and XRP is at 0.48, with a decrease of 0.01 points, marking a 1.17% decrease.
In the Bonds & Rates category, yields and yield changes are as follows: The 3 Month Treasury yield is at 5.345%, with a slight increase of 0.005%. The 2 Year Treasury yield stands at 5.071%, marking a more significant rise of 0.076%. For the 5 Year Treasury, the yield is 4.694%, reflecting a notable increase of 0.105%. Similarly, the 10 Year Treasury yield is at 4.700%, with a significant increase of 0.128%, and the 30 Year Treasury yield stands at 4.857%, experiencing a larger rise of 0.147%.
In the Currencies section, exchange rates and their changes are as follows: The Euro to US Dollar rate is recorded at 1.0531. The British Pound to US Dollar rate stands at 1.2178, with a slight decrease, marking a 0.02% change. The US Dollar to Canadian Dollar rate is 1.3693, with a minor increase, reflecting a 0.01% change. The US Dollar to Swiss Franc rate is 0.9079, experiencing a small decrease, signifying a 0.09% change. Lastly, the US Dollar to Japanese Yen rate is 149.8130.
In the realm of commodities, the Bloomberg Commodity Index (BCOMTR:IND) stands at 234.52, indicating a positive change of +0.76 points, representing a 0.33% increase. The index reached its highest point at 235.23 and its lowest at 233.16. The UBS Bloomberg CMCI (CMCITR:IND) currently stands at 1,525.80, showing a gain of +5.72 points, indicating a 0.38% increase. It reached its peak at 1,528.00 and registered a low of 1,518.18. In the case of the Reuters/Jefferies CRB (CRYTR:IND), the index is now at 314.05, reflecting a gain of +0.84 points, which signifies a 0.27% increase. The highest and lowest values recorded were 314.05 and 313.21, respectively. Rogers International (RICIGLTR:IND) is currently valued at 3,786.70, with a gain of +7.43 points, equivalent to a 0.20% increase. It reached its highest point at 3,806.23 and registered a low at 3,768.43.
In the energy sector, WTI Crude Oil (CL1:COM) is priced at 82.91 USD/bbl., reflecting a -0.58 point change, equivalent to a -0.69% decrease. Brent Crude (CO1:COM) stands at 86.27 USD/bbl., up +0.45 points, indicating a 0.52% increase. RBOB Gasoline (XB1:COM) is valued at 216.50 USd/gal., marking a -4.51 point change, a -2.04% decrease. Natural Gas (NG1:COM) is listed at 3.34 USD/MMBtu, down -0.03 points, a -0.98% change. Heating Oil (HO1:COM) is priced at 304.49 USd/gal., showing a gain of +4.64 points, equivalent to a 1.55% increase.
For precious and industrial metals, Gold (GC1:COM) is at 1,883.00 USD/t oz., with a change of -4.30 points, representing a -0.23% decrease. Gold Spot (XAUUSD:CUR) stands at 1,868.79 USD/t oz., experiencing a -0.11 point change. Silver (SI1:COM) is valued at 21.96 USD/t oz., showing a change of -0.17 points, a -0.79% decrease. Copper (HG1:COM) is at 359.10 USd/lb., down -2.10 points, representing a -0.58% decrease. Platinum Spot (XPTUSD:CUR) is priced at 869.64 USD/t oz., indicating a change of -1.04 points, a -0.12% decrease.
In the agriculture sector, Corn (C 1:COM) is at 496.00 USd/bu., up +8.00 points, indicating a 1.64% increase. Wheat (W 1:COM) is valued at 571.50 USd/bu., showing a change of +15.50 points, a 2.79% increase. Cocoa (CC1:COM) is priced at 3,490.00 USD/MT, up +58.00 points, indicating a 1.69% increase. Cotton #2 (CT1:COM) stands at 84.92 USd/lb., with a change of -0.13 points, a -0.15% decrease. Live Cattle (LC1:COM) is at 187.80 USd/lb., showing a gain of +0.83 points, a 0.44% increase.
On Friday, October 13, 2023, several economic indicators are set to be published. At 8:30 AM ET, Import and Export Prices data will be disclosed. This data includes year-over-year (Y/Y) and month-over-month (M/M) Import Prices and Export Prices. The release is anticipated to have a medium impact. Forecasts for the upcoming release are available.
At 10:00 AM ET, the Consumer Sentiment Index and Year-ahead Inflation Expectations will be made public. The impact of this release is expected to be medium. No specific forecast data is available for this release at the moment.
Finally, at 1:00 PM ET, the Baker Hughes Rig Count will be released, covering the United States, North America, Canada, and the Gulf of Mexico. This release is expected to have a low impact. No specific forecast information is currently available for this release.