Wall Street shivered after the US midterm elections this week, but Wednesday’s heavy market losses were equally due to cryptocurrency implosion, severe tech industry woes, and trepidation ahead of the key update. US inflation on Thursday.
Annual consumer price inflation is expected to have eased slightly last month to 8.0%, the lowest level since February, and core inflation is expected to drop to 6.5%. The decline in used car prices, an aggravating factor in inflation indices over the past year, will be followed closely, as will the relative calm in oil prices.
Oil stretched its losses Thursday to a fourth day as new COVID restrictions in China sparked concerns about fuel demand in the world’s largest crude oil importer. Hurricane Nicole also weakened into a tropical storm as it followed Florida to Georgia.
But despite all the tension in the markets around the release of inflation, any hope that the monthly data could alter the Federal Reserve’s tightening trajectory has been dampened.
Minneapolis Fed Chairman Neel Kashkari said it is “completely premature” to discuss a pivot of current Fed policy. “We are on the right track right now: I think we are united in our commitment to bring the inflation at 2% “.
This tightening will do nothing to help the slow pace of the cryptocurrency world.
Cryptocurrencies faltered on Thursday after a week of staggering losses and existential fears for the entire industry as cryptocurrency exchange FTX risks collapsing now that rival Binance has pulled out of a last-minute bailout. Bitcoin, which has seen more than a quarter of its value disappear since Saturday, dipped below $ 16,000 for the first time in two years before stabilizing just above that level early Thursday.
The broader markets remained steadily negative around the world, mainly in a pattern of anticipation before the inflation report.
Ever since the Russian invasion of Ukraine this year worsened energy, inflation and the world economy, investors have been following developments and developments on the battlefield very closely.
With a major development on Wednesday, Moscow ordered troops to retreat near the strategic southern Ukrainian city of Kherson in one of its biggest setbacks of the war so far, though Ukraine said it doubted Russian troops would do so. they would go without a fight.
News of some movement towards negotiations comes ahead of the G20 summit in Indonesia next week. Russian President Vladimir Putin will not attend the summit in person, but the host country Indonesia said Thursday that he could attend a virtual session.
The United States and China also set milestones this week ahead of their eagerly awaited meeting between their summit presidents.
Chinese stocks, however, fell again, largely on COVID-related fears. Chinese authorities should take a more focused approach to tackle COVID outbreaks and avoid further “layers” of measures, state news agency Xinhua reported, as cities are subject to tighter restrictions as new cases spread. .
In Japan, the yen remained stable after Bank of Japan Governor Haruhiko Kuroda said that any future discussion of an exit from the central bank’s ultra-free monetary policy will center on the pace of rising interest rates. massive budget.
In the banking sector, Credit Agricole shares fell 4% after the French bank missed its third-quarter earnings estimates, due to lower trading revenues and withdrawals from asset manager Amundi.
Key Developments That Could Drive US Markets Later Thursday:
* October US Consumer Price Index, Weekly Jobless Claims, October Federal Budget
New York Federal Reserve Chairman John Williams Fed Board Governor Christopher Waller Philadelphia Fed Chairman Patrick Harker Dallas Fed Chief Lorie Logan Kansas City Fed Chief Esther George Everybody Speaks
* 30 year US Treasury auctions
* Results from American companies: Ralph Lauren, Tapestry etc.
* Bank of Canada Governor Tiff Macklem speaks
GRAPH: US inflation and bond yields https://fingfx.thomsonmigration.com/gfx/mkt/gdvzqrxgbpw/One.PNG
GRAPH: crypto deflation https://fingfx.thomsonmigration.com/gfx/mkt/jnvwygmokvw/One.PNG
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