Baku:Global markets are experiencing uncertainty as they contend with volatility in tech stocks, surging oil prices, and mixed signals from American bank earnings. Investors are closely monitoring the upcoming US inflation data, set to be released on Wednesday, which is expected to show an acceleration due to rising energy costs. This data will provide insights into the Federal Reserve's potential future monetary policy.
According to Anadolu Agency, the Federal Reserve is 78% likely to maintain its interest rates this month, based on money market estimates. Meanwhile, geopolitical tensions in the Middle East continue to affect market sentiment. Brent crude oil for December delivery rose 0.6% to $106.3 a barrel following an attack by Yemeni Houthi militias on Saudi Arabia.
New York Fed President John Williams indicated that while another rate hike might occur this year, he expects no further increases will be needed, anticipating a significant decline in inflation next year. In response, the US 10-Year Treasury bond yield decreased slightly to 5.21%. The US dollar also dipped 0.1% to 102.2, and gold prices fell by the same margin to $4,158 per ounce.
OPEC's crude oil production saw an increase of 920,000 barrels in September, reaching nearly 20.1 million barrels. This growth has led to a revision in global oil demand forecasts, with a downward adjustment for this year and an upward one for the next. The International Monetary Fund has highlighted the pressure on public finances due to rising borrowing costs amidst high debt levels, urging for fiscal consolidation measures.
In the stock market, a broader selloff in chipmaker stocks negatively impacted the New York Stock Exchange. Micron Technology, SK Hynix, AMD, and Western Digital all saw declines in their share prices. Major US banks reported varied financial results, with JPMorgan Chase, Citigroup, and Goldman Sachs experiencing drops in stock value despite differing profit and revenue outcomes. Wells Fargo, while exceeding profit expectations, also saw a decrease in its stock value.
US existing-home sales showed positive growth, rising 1.5% in September against expectations of a decline. However, major American indices showed mixed performance, with the Dow Jones falling 0.35%, the Nasdaq Composite declining 0.15%, and the S&P 500 trading flat on Tuesday.
European markets mirrored this trend, facing selloffs amid tech stock declines. Notable drops were seen in shares of Dutch chipmaker ASML and German tech firm Infineon. BMW's sales in the third quarter fell, but its shares rose due to demand for electric vehicles. European indices started Wednesday with mixed performance.
Asian markets, however, traded mostly higher near the close. China's economic data showed a rise in its producer price index and consumer price index, driven by increasing energy prices. The country's exports and imports also surged, suggesting a move away from deflationary pressures. Consequently, Chinese policymakers might need to implement further policy support to meet economic growth targets. In Asian equity markets, South Korea's Kospi, Japan's Nikkei 225, and Hong Kong's Hang Seng all saw gains, while China's Shanghai Composite remained flat.