17 Oct 2022

Last Friday, U.S. stocks opened higher and moved lower. As of the close, the S&P fell 2.37%, the Nasdaq fell 3.08%, and the Dow fell 1.34%. The yield on the 10-year U.S. Treasury bond rose 7 basis points, exceeded 4%, and closed at 4.023%, which was -48 basis points compared with the yield on the two-year Treasury bond, maintaining a deep inversion. The VIX, the fear gauge, rose 0.25%. Crude oil prices turned higher, with Brent crude falling 3% to close at 91.72. Spot gold fell 1.3% to $1,644.45 an ounce. The dollar index rose 0.73% to close at 113.28.

US retail sales in September recorded a monthly rate of 0%, expected 0.20%, the previous value of 0.30%. The director of consumer surveys at the University of Michigan commented that the median consumer expectations for inflation in the coming year rose to 5.1%, well above the expected 4.6%, and inflation expectations for different ages, incomes and education levels have risen. Long-term inflation expectations fell below a narrow 2.9-3.1% range for the first time since July 2021 last month, but have since returned to that range of 2.9%. Natural gas prices have been expected to rise slightly in the year ahead for 3 months, with a rebound in both short-term and long-term expectations in October.

Institutional surveys show economists expect the labor market and demand to fall victim to the Fed's fight against inflation. The survey showed a 60 percent chance of a U.S. recession in the next 12 months, up from 50 percent in September and twice as much as six months ago. The latest survey was conducted Oct. 7-12 and had 42 economists surveyed. "A significant tightening of financial conditions is clearly not good for growth, and at a time when consumer and business confidence is already under enormous pressure from the rising cost of living and falling stock, bond and property prices," said ING's chief economist.

The Fed voted for Daly to say that the terminal rate may have to be raised, and 4.5%-5% is most likely to be the highest level of the federal funds rate and stay there for a longer period of time, but I have no doubts about the speed of the rate hike. more cautious than most. And said we could correct the course if needed. Bullard, known as the "Eagle King", has eased his attitude, saying that the September inflation data showed the need to "pre-raise interest rates", but the overall interest rate may not need to be higher, and the interest rate will reach the range of 4.5%-4.75% by the end of the year. is appropriate, further rate hikes will be subject to future data.

Federal Reserve Bostic discloses illegal transactions, and Fed Chairman Powell has asked Fed regulators to conduct an independent review of Atlanta Fed President Bostic's financial disclosures. Bostic said in a statement Friday that he did not know the specific transactions or the timing of the transactions, which were made by third-party managers on accounts he did not have the ability to direct.

Apple fell 3.2%. According to media reports, compared to the same time period last year, the depreciation of Apple’s iPhone 14 models was more than twice that of the iPhone 13.

Tesla fell 7.55%. According to German "Handsblatt" on the 14th, citing experts, Tesla has suspended the battery production plan at the Greenheide factory outside Berlin, Germany due to technical problems. At present, only electrodes are retained there. aspects of research.

Amazon fell 5% on news that it was closing more virtual experience programs, continuing a trend of cutting cost-intensive projects.

Sources from: Investing.com; Reuters.com

Louis Yap

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