Daily Market Brief – 31st Aug

1. The?US equity markets continued their downward spiral?with the S&P 500 declining -1.1% to 3986.16. The tech-heavy nasdaq composite fell -1.1% too, ending the day at 11883.14. The 30-stock DJIA dropped by around -1%. US stocks have been descending ever since the Fed chairman Jerome Powell's speech, where he reiterated the need to raise interest rates further.
2. The U.S labour department released the latest job numbers on Tuesday. According to this data, job openings?increased in July, compared to the previous month.?A tight labour market adds fuel to both inflationary forces and emboldens the Fed to continue its hawkish stance. Data on actual number of jobs added would be released later this week.
3. The?fixed income market continued to display dichotomy?with short term rates inching up. the yields on 2-year treasuries rose to 3.446% from 3.427% earlier, while the 10-year yields fell slightly to 3.107%, from 3.109%. The commodities market too joined in the fray, with crude oil as measured by the Brent crude crashed -5.5% to $99.3 a barrel. In fact, energy stocks were among the worst performers in the S&P 500 yesterday.
4. Markets outside the US were a mixed bag. The FTSE 100 and STOXX 600 declined -0.88% and -0.67% respectively, while the Nikkei 225 of Japan, and India's Sensex jumped 1.14%, and 2.70%, respectively. Mainland China and Hong Kong markets continue to remain weak with Indices in both these regions declining.
5. The markets continue to remain macro-dominated and sentiment driven. With several key pieces of data including employment numbers, PMI numbers and non-farm payroll numbers coming out later this week, we can expect markets to continue to swing between 'good news is bad news' and 'no news is good news'.

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