US stock markets came under pressure again yesterday as disappointing technology earnings weighed on sentiment, with the Nasdaq falling 1.38%. Treasury yields and the dollar declined after Core PCE inflation broadly matched expectations, prompting traders to pare back expectations of a December Federal Reserve rate hike. Oil prices edged higher as Middle East hostilities kept supply concerns elevated, while gold fell back towards the key $4,000 level. The Bank of Japan, Tokyo inflation, German inflation and GDP, US labour costs and Canadian GDP are all in focus today.
📊 Equities
US stock markets came under pressure again in trading yesterday as more disappointing results from major technology companies weighed on investor sentiment. The Nasdaq bore the brunt of the selling, dropping 1.38% as Alphabet’s Q3 numbers failed to impress investors, with Amazon adding to the negative mood after the closing bell. The Dow fell 0.25% to 52,342, while the S&P 500 declined 0.30% to 7,720. The Nasdaq closed at 26,184.
🛢️ Oil
Oil prices continued to edge higher as ongoing hostilities in the Middle East kept supply concerns firmly at the forefront of traders’ minds. Brent crude pushed further above the $115 level, while WTI held comfortably above $100 as markets continued to price in the potential for further disruptions to regional production and shipments. With peace negotiations still struggling to gain traction, traders remain wary of another escalation that could send energy prices sharply higher. Brent rose 0.16% to $115.50, while WTI added 0.11% to $102.89.
🥇 Gold
Gold failed to capitalise on the weaker US dollar and falling Treasury yields, dropping 1.15% as the precious metal continued to struggle for momentum. The move saw gold retreat back towards the psychologically important $4,000 level, which is likely to remain a key focus for traders in the coming sessions. Gold closed at $4,020.42.
💵 FX & Bonds
US Treasury yields fell sharply after the latest Core PCE inflation data came in broadly in line with market expectations, prompting traders to scale back their expectations for a Federal Reserve rate hike in December. The benchmark 10-year yield dropped 8.0 basis points to 4.937%, while the more policy-sensitive 2-year yield fell 10.0 basis points to 4.598% as markets reassessed the Fed’s next move. The Dollar Index slipped 0.29% to 101.85 as the prospect of a less hawkish Fed weighed on the greenback.
| Market | Change | Close |
|---|---|---|
| Dow | -0.25% | 52,342 |
| S&P 500 | -0.30% | 7,720 |
| Nasdaq | -1.38% | 26,184 |
| USD | -0.29% | 101.85 |
| US Treasury – 2 Year | -10.0 bps | 4.598% |
| US Treasury – 10 Year | -8.0 bps | 4.937% |
| Oil – Brent | +0.16% | $115.50 |
| Oil – WTI | +0.11% | $102.89 |
| Gold | -1.15% | $4,020.42 |
📌 Today’s Focus (AEDT)
Traders are expecting another lively session to close out the trading week, with the Bank of Japan’s latest interest rate decision and subsequent press conference set to dominate the Asian session. Tokyo inflation numbers will also be closely watched, particularly given the implications for future Japanese monetary policy and the yen. European markets will have German inflation and GDP numbers to contend with, while the US Employment Cost Index and Canadian GDP data will provide further opportunities for volatility later in the day. With earnings season, central bank expectations and Middle East developments all continuing to influence sentiment, traders should be prepared for another active session heading into the weekend.
🔹 Asian Session – 10.30 am – Japan – Tokyo Core CPI Data
🔹 Asian Session – Tentative – Japan – Bank of Japan Interest Rate Decision
🔹 Asian Session – Tentative – Japan – Bank of Japan Press Conference
🔹 European Session – All Day – Germany – Preliminary CPI Data
🔹 European Session – 8.00 pm – Germany – Preliminary GDP Data
🔹 US Session – 11.30 pm – US – Employment Cost Index Data
🔹 US Session – 11.30 pm – Canada – GDP Data