Federal Reserve officials view the increasing yields on long-term US Treasury debt as a sign that their tight-money policies are effective, although they do not see it as a cause of concern for the economy at this point.
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The stock market is down due to rising Treasury yields in the bond market, which is pulling investment dollars away from stocks, leading to concerns about the impact of higher interest rates on the economy and markets.
Wall Street stocks sold off on Tuesday as rising Treasury yields and a reminder from Fed policymakers about no interest rate cuts caused a selloff, with the S&P 500 dropping nearly 1.4%.
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Stocks on Wall Street fell in early trading on Tuesday as rising Treasury yields and hawkish comments from Federal Reserve policymakers dampened investor sentiment. The tech-heavy Nasdaq Composite was down over 1.4%, the Dow Jones Industrial Average tumbled about 0.9%, and the S&P 500 dropped almost 1.1%. Additionally, the number of open jobs in the US increased in August, raising questions about whether the job market is cooling fast enough to satisfy the Federal Reserve as it considers more interest rate hikes to combat inflation.
The recent surge in U.S. government bond yields, with prices falling, has raised concerns about the stability of the bond market and the economy, potentially leading to more bank failures and market upheaval.
Stocks finished mixed on Monday, as the Nasdaq led the way with a 0.7% increase, while the S&P 500 turned just above the flatline, and the Dow Jones Industrial Average dropped 0.2% to start the new quarter of trading after averted government shutdown concerns.
German footwear brand Birkenstock is preparing to go public with an initial public offering (IPO) that could raise up to $1.58 billion, placing its total valuation at $9.2 billion, and marking the latest test for the US IPO market's recovery after a long dry spell.
The Federal Reserve remains committed to raising interest rates despite the rise in U.S. bond yields, as the U.S. economy shows signs of re-accelerating in the third quarter and inflation worries ease.
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Shares of Chinese real estate giant Evergrande have surged after trading in the company resumed in Hong Kong following a temporary suspension, amidst investigations into its billionaire founder and a default on its debts, triggering a property crisis in China.
Shares of Tesla Inc. rose 0.55% on Monday, marking its third consecutive day of gains, while it closed $47.69 below its 52-week high.
Asia-Pacific equity markets closed lower, with India's SENSEX, Taiwan's TAIEX, Australia's ASX All Ordinaries, Japan's Nikkei, and Hong Kong's Hang Seng all declining, while European markets are down in midday trading and U.S. equity futures point to a flat to positive open as investors remain focused on the 10-year Treasury yield and await comments from Fed officials later in the week.
The world's biggest bond markets are experiencing a selloff as higher interest rates become the new norm, which has implications on government borrowing costs, global financial markets, and emerging economies.
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Chinese EV manufacturer XPeng reinforces its commitment to global expansion by shipping 750 electric vehicles to Israel, aiming to establish a strong sales and service network in major Israeli cities and break into the growing Israeli market dominated by established brands.
Housing prices in nearly all U.S. counties are more unaffordable than ever before, with home prices continuing to rise while wages lag behind, making it increasingly difficult for average Americans to afford a home.
Japanese Finance Minister Shunichi Suzuki has stated that authorities are closely monitoring the currency market and are prepared to take action against speculative moves that do not align with economic fundamentals.
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Blockchain analytics firm Chainalysis has reduced its workforce by 15%, around 150 employees, due to the ongoing bear market and the need to cut expenses.
Gold and silver prices have remained stagnant for over three years despite high inflation and geopolitical turmoil, leading investors to consider the alternatives, such as holding cash, given the decline in the dollar's purchasing power and the potential for a looming recession and economic reckoning, making other conventional assets like bonds, equities, and real estate appear overvalued.
Bitcoin surged over $28,000, experiencing a sudden spike and potentially driven by a short squeeze in the futures market, while Ethereum also rose above $1,700 for the first time in five weeks, contributing to a positive overall sentiment in the crypto market.
The World Bank has lowered its growth forecast for China next year and warned of slow expansion, leading to concerns about global economic growth, despite European markets and FTSE 100 being up on Monday morning in London.
Bitcoin aims for $28,500 as it continues its bullish start to October, despite caution from analysts and a strong rebound in the U.S. dollar.
Japan's business sentiment improved in the third quarter, with big manufacturers' index rising to 9 and big non-manufacturers' index increasing to 27, indicating a strong economic revival and potential conditions for the Bank of Japan to phase out stimulus measures.
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Asian markets may receive a boost after the US Congress reached a last-minute deal to prevent a partial federal government shutdown, although Chinese data indicating mixed levels of services and manufacturing activity could hinder the positive sentiment.
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China's GDP forecast for 2024 has been lowered by the World Bank, while oil prices have had a positive impact on Russian stocks, and the US economy shows signs of recovery.
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The U.S. bond market is signaling the end of the era of low interest rates and inflation, with investors now believing that the U.S. economy is in a "high-pressure equilibrium" characterized by higher inflation, low unemployment, and positive growth. This shift has significant implications for policy, business, and individuals, as it could lead to failed business models and unaffordable housing and cars, and may require the Federal Reserve to raise rates further to control inflation.
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Tesla announced third-quarter deliveries of just over 435,000 vehicles, slightly lower than the previous quarter, but the company remains on track to meet its 2023 delivery target of 1.8 million vehicles.
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Japan's factory activity fell at the fastest pace in seven months in September, reflecting weakening global economic conditions and a decline in new export orders.
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Stocks mostly fell in the U.S. on Friday, with the S&P 500 and Dow Jones Industrial Average declining, while the Nasdaq Composite inched up; all three indexes ended the month of September in the red, with the S&P and Nasdaq experiencing their worst monthly performance since December, and the Dow having its worst showing since February.
European markets are set to open higher on Monday following a slowdown in euro zone inflation, while Asia-Pacific stocks traded mixed and U.S. stock futures jumped after a temporary agreement was reached to avoid a government shutdown. Veteran EM investor Mark Mobius recommends two tech giants for portfolios investing in developing economies, and Goldman Sachs names six global stocks to play the energy transition.
The price of gold is facing challenges due to moderate US economic data, higher US Treasury yields, and the strength of the US dollar, causing its losing streak to continue.
Manufacturing Shakeup Creates Economic Winners and Losers As Companies 'Friendshore' Away From China
Tensions between the West and China are impacting global markets, leading to potential inflation and higher interest rates, while presenting opportunities for emerging nations and tech giants; strategies such as bringing manufacturing home and "friendshoring" are being pursued, with India viewed as a strong competitor to China in manufacturing; the clash between China and the West also has implications for sectors such as semiconductors, luxury goods, and investment in China; investors are divided on how to approach the Chinese market.
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Amazon invests up to $4 billion in AI start-up Anthropic, boosting their generative AI capabilities and easing investor concerns.
Cisco has announced plans to acquire Splunk for $28 billion in cash, a move that will benefit Cisco's transformation into software and subscription-based services but may cause short-term disruptions in the market for Splunk and Cisco's competitors in observability and cybersecurity.
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Kitco News offers a 5-minute bar chart for Comex gold futures, providing valuable analytical and trading information for active intra-day gold futures traders.
Home prices have decreased in several major cities, but many remain overvalued and at risk of entering a housing bubble, according to a UBS report, with Zurich and Tokyo being identified as the most overvalued markets. UBS defines a bubble as a sustained mispricing of an asset, and factors such as price-to-income and price-to-rent ratios were used to determine the rankings. While some cities have seen a drop in prices, a housing shortage could lead to a renewed boom if interest rates fall.
The Japanese Yen is weakening against the US Dollar as interest rate differentials continue to weigh on the Yen, with markets suspecting that the Bank of Japan may step in to support the currency at current levels.
European markets are set to open lower as investors consider recent central bank decisions and the possibility of higher interest rates, while U.S. stock futures show a slight increase following substantial losses this month.
