(Bloomberg) — Stocks rose as appetite for risk assets returned after Israel’s military action in the Gaza Strip proceeded more cautiously than some investors had feared.
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Europe’s Stoxx 600 index and S&P 500 futures rose 0.6%. Wall Street indexes fell on Friday, with sentiment souring on concerns such as the Federal Reserve’s persistently hawkish stance and underwhelming corporate earnings. On Monday, Brent crude oil fell below $89 per barrel and gold fell below $2,000 per ounce. The yield on the 10-year US Treasury note rose slightly to 4.85%.
Instead of a large-scale ground invasion, the Israeli military started slowly, taking a day-by-day approach. Aside from war developments, there are a number of potentially market-moving events that investors should keep an eye on this week, including central bank meetings in Japan, the United States, and the United Kingdom, as well as the announcement of the U.S. Treasury’s quarterly bond sales plan. include.
“So far, the market’s worst fears about the situation in the Middle East have not materialized, despite Israel’s increased operations over the weekend,” said Eddie Chan, a strategist at Credit Agricole. “This week’s Fed meeting may not come as much of a surprise, but interest rates could be more volatile this week ahead of the Treasury’s refund announcement.”
HSBC Holdings had a strong showing, with reports of pre-tax profit of $7.71 billion, lower than analysts’ expectations, offset by up to $3 billion in additional share buybacks by the bank.
In Asia, inventory indicators in the region gradually declined. Meanwhile, the Shanghai Composite Index and China CSI Index rose for the fifth day in a row. In China’s EV sector, Great Wall Motors rose 7.7% after better-than-expected results in Hong Kong.
Global stock markets have lost $12 trillion in value since the end of July as concerns grow that central banks’ “prolonged high interest rate” policies could push the global economy into recession. The S&P 500 entered a technical correction on Friday after rising volatility and rising inflation, with the benchmark ending 10% below its recent peak.
Michael Wilson, a strategist at Morgan Stanley, said investors who expected the stock to rise by the end of the year will be disappointed.
“The chances of an upside in the fourth quarter have gone down considerably,” said Wilson, who was once again named Best Portfolio Strategist in the latest Institutional Investor Survey. He said: “The narrower breadth, cautious factor leadership, downward earnings revisions, and weakening consumer and business confidence tell a different story than the consensus, which expects it to move higher towards the end of the year.”
The VIX index, known as Wall Street’s fear gauge, has risen to more than 21 from about 13 in mid-September, the highest level reached in March, when multiple local bank failures triggered a market crash. It remains below the mid-20s.
Investors will be watching Wednesday’s announcement of a Treasury bond sale. The content of the plan could determine whether the 10-year Treasury yield has continued upward momentum after surging to a 16-year high last week. U.S. jobs data will be released on Friday and could show that job and wage growth slowed last month.
This week’s main events include:
The day of China’s main monetary policy meeting, an unusual closed-door event led by President Xi Jinping, begins on Monday.
Japan’s unemployment rate, industrial production, retail sales, Tuesday
Bank of Japan interest rate decision, Tuesday
China Non-Manufacturing PMI, Manufacturing PMI, Tuesday
Eurozone CPI, GDP, Tuesday
US construction spending, ISM manufacturing, job openings, Wednesday
U.S. Treasury Quarterly Refund Announcement Wednesday
Wednesday’s Federal Reserve Interest Rate Decision
Bank of England interest rate decision Thursday
China Caixin releases PMI on Friday
Eurozone unemployment rate, Friday
U.S. unemployment rate, nonfarm payrolls, Friday
The main movements in the market are:
stock
As of 8:17 a.m. London time, the Stoxx Europe 600 was up 0.7%.
S&P 500 futures rose 0.6%
Nasdaq 100 futures rose 0.8%
Dow Jones Industrial Average futures rose 0.5%
MSCI Asia Pacific Index falls 0.2%
MSCI Emerging Markets Index rose 0.3%
currency
Bloomberg Dollar Spot Index little changed
The euro fell 0.1% to $1.0551.
The Japanese yen remained almost unchanged at 149.58 yen to the dollar.
The offshore yuan was almost unchanged at 7.3301 yuan to the dollar.
The British pound fell 0.2% to $1.2098.
cryptocurrency
Bitcoin fell 0.9% to $34,262.46.
Ether fell 0.3% to $1,792.43.
bond
The 10-year Treasury yield rose 2 basis points to 4.85%.
Germany’s 10-year bond yield fell 5 basis points to 2.78%.
UK 10-year bond yields fell 3 basis points to 4.52%.
merchandise
Brent crude oil fell 1.6% to $89.05 per barrel.
Spot gold fell 0.6% to $1,993.75 an ounce.
This article was produced in partnership with Bloomberg Automation.
–With assistance from Michael G. Wilson, Ye Xie, Matthew Burgess, and Robert Brand.
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