European markets closed lower on Tuesday after processing numerous corporate results. The STOXX Europe 600 index fell by 0.6%, while the German DAX lost 0.3% and the French CAC 40 declined by 0.6%. Investors are still awaiting the results of major American tech giants. Microsoft and Meta will report results today, and Apple and Amazon on Thursday. Meanwhile, tensions in the Middle East appear to be easing, contributing to lower oil prices.
In October, consumer confidence in the US saw a strong increase, as shown by Tuesday’s figures from The Conference Board. The index rose from 99.2 in September to 108.7, the highest level in nine months. An index of 99.5 was expected for October. The outlook for economic expectations in the coming half-year increased from 81.7 to 89.1. This kept the index above 80 for the third consecutive month. The Conference Board considers a score below 80 to be a possible recession signal within a year.
China is considering issuing over 10 trillion yuan in debt, equivalent to 1.4 trillion dollars, to stimulate its economy. This has been reported by Reuters based on sources. The Standing Committee of the National People’s Congress intends to approve this plan during their meeting in early November. The total amount, which will support local governments, corresponds to more than 8% of China’s GDP.
The 6M Euribor increased with 2 basis points to 2.91% compared to previous business day. The 10Y Swap is unchanged at 2.40% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
US stocks surged on Monday as Middle East tensions eased. The Nasdaq rose 0.5%, the S&P 500 climbed 0.4%, and the Dow added 300 points. Key focus areas include Big Tech earnings from Alphabet, Apple, Amazon, Microsoft, and Meta, with investors scrutinizing whether AI investments are translating to profits. Additionally, crucial economic data on inflation and jobs could influence the Federal Reserve’s interest rate decisions at their upcoming meeting.
European markets advanced on Monday as geopolitical tensions in the Middle East cooled. The pan-European Stoxx 600 rose 0.47%, with gains in media and construction sectors, while oil and gas stocks diminished. Philips suffered a 17% drop in share value due to decreased demand from China. In Japan, the Nikkei 225 and Topix indexes climbed, helped by a depreciating yen.
Bitcoin-related stocks rallied on Monday as the cryptocurrency approached $70,000. Coinbase’s shares jumped 4%, while MicroStrategy rose over 5%. Bitcoin miners Mara Holdings and Riot Platforms saw gains of 6% and 5%, respectively. With quarterly earnings reports and the US presidential election approaching, Bitcoin enthusiasts are hopeful for new highs.
The 6M Euribor decreased with 3 basis points to 2.89% compared to previous business day. The 10Y Swap decreased with 1 basis point to 2.40% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
Donald Trump’s potential tariffs have severely impacted European stocks, particularly in export-sensitive sectors like carmakers and luxury goods. The value of a group of 28 companies at risk from these tariffs has fallen 7% since late September, reflecting concerns over Trump’s rising election odds and potential trade tensions. While some analysts warn of additional challenges from EU stagnation and reduced Chinese demand, others see the market’s pessimism as exaggerated, anticipating a possible rally benefiting European stocks if Republicans win decisively.
French luxury, defense, and construction companies are facing higher tax bills due to a new budget proposal, threatening profitability and potentially reversing Macron’s reforms. Michel Barnier’s plan aims to address deficits with temporary tax hikes, but businesses and economists remain skeptical about its impact. While some executives express concern over investment potential, experts warn more permanent tax increases might occur if budget deficits persist.
China’s industrial profits fell sharply in September, dropping 27.1% year-on-year as economic momentum stalls. Policymakers are under pressure to boost confidence amid a property slowdown and weak consumer demand. Despite recent measures to support the economy, analysts call for further fiscal stimulus to achieve the government’s GDP growth target.
The 6M Euribor decreased with 5 basis points to 2.92% compared to previous business day. The 10Y Swap increased with 1 basis point to 2.41% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
In October, the British economy faced a slowdown, according to preliminary figures released on Thursday by S&P Global. The composite index dropped from 52.6 to 51.7, marking the lowest level in 11 months. The Purchasing Managers’ Index (PMI) for the services sector fell from 52.4 to 51.8, while the manufacturing sector index decreased from 51.5 to 50.3. An index level above 50 indicates growth, while below 50 signals contraction.
In the United States, the manufacturing sector contracted less sharply in October, while the services sector grew slightly faster. Preliminary data from S&P Global, released on Thursday, showed that the PMI for manufacturing rose from 47.3 in September to 47.8 in mid-October. The services activity index improved from 55.2 to 55.3. As a result, the composite PMI increased to 54.3 in October, up from 54.0 in September.
The euro strengthened on Thursday after German bond yields rose, following better-than-expected macroeconomic data from Germany. The composite PMI in Germany increased to 48.4 in October, up from 47.5 in September.
The 6M Euribor increased with 2 basis points to 2.97% compared to previous business day. The 10Y Swap decreased with 5 basis points to 2.40% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
The US dollar has surged to its highest level since August, driven by strong economic data and investor expectations of Donald Trump’s potential election victory. The currency’s nearly 4% rise since late September is supported by strong jobs data and reduced Fed rate cut expectations. Investors anticipate Trump’s policies will increase inflation and interest rates, further strengthening the dollar amid election uncertainties.
France aims to narrow its budget deficit with €60bn in tax hikes and spending cuts, risking growth in a fragile economic climate. Analysts warn these fiscal measures could impact GDP and employment, challenging President Macron’s goals and straining the Eurozone. The Barnier government, lacking a parliamentary majority, faces political obstacles in implementing unpopular policies to address persistent deficits, including the costly pensions system.
The IMF has upgraded the UK’s growth forecast, projecting growth of 1.1% this year and 1.5% in 2025, boosting Chancellor Rachel Reeves ahead of her Budget announcement. This positive outlook is attributed to falling inflation and interest rates, potentially leading to more aggressive rate cuts by the Bank of England. Despite the improved forecast, Reeves faces challenges in balancing economic growth with reducing public debt and closing a £40bn funding gap.
The 6M Euribor decreased with 2 basis points to 2.95% compared to previous business day. The 10Y Swap decreased with 1 basis point to 2.45% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
According to the latest World Economic Outlook from the IMF, the US economy is expected to grow by 2.8% this year and 2.2% next year. This positions the US as a driving force behind the global economy, which is projected to grow by more than 3% in 2024 and 2025. Growth in the eurozone is lower than previously expected, mainly due to Germany’s anticipated zero growth this year. Global inflation is expected to decrease to 3.5% by the end of 2025.
Nervousness about the US elections and the plans of Donald Trump and Kamala Harris are causing concerns over government finances and increasing the risk premium on government bonds. Despite a recent interest rate cut by the Federal Reserve, capital market rates have risen, peaking at 4.22% for the ten-year Treasury bonds. This continues to worry investors, adding pressure to stock indices. Economists point out that the economy and labor market are stronger than expected, reducing the need for further rate cuts and potentially delaying inflation targets.
The Indian rupee fell to a record low on Tuesday, influenced by weak regional peers and local equity outflows, but Reserve Bank of India’s intervention curtailed sharper declines. It closed slightly weaker at 84.0775 against the U.S. dollar, having touched its lowest ever level of 84.0825 earlier in the session.
The 6M Euribor decreased with 6 basis points to 2.97% compared to previous business day. The 10Y Swap increased with 2 basis points to 2.46% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
Chinese banks have lowered their benchmark lending rates, after the central bank’s easing measures late September, to boost economic growth and address the housing market slump. The one-year loan prime rate was cut to 3.10% from 3.35%, and the five-year loan prime rate to 3.60% from 3.85%. These cuts exceed the forecasted range of 20-25 basis points by the People’s Bank of China and the 20 basis point reduction expected by Bloomberg economists.
The dollar rose on Monday, supported by higher U.S. bond yields and strong economic data indicating the Federal Reserve can delay rate cuts. Markets see a 91.7% chance of a 25 basis point cut in November. The 10-year U.S. Treasury yield increased 8.3 basis points to 4.158%, reaching a 3-month high.
Recent volatility in risk-sensitive assets raises concerns that the Federal Reserve’s interest rate cuts may be premature or unsustainable. Emerging Markets (EM) sovereign dollar bonds and local-currency bonds both saw yields increase by 9 basis points since Sept. 18, according to Bloomberg. EM equity, mainly driven by China, rose 13% this year but still lags the S&P 500’s 23%, disappointing investors.
The 6M Euribor decreased with 1 basis point to 3.03% compared to previous business day. The 10Y Swap increased with 8 basis points to 2.44% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
Bank of America strategists predict a record $520 billion in state and local government debt issuance in 2025, with a revised 2024 forecast of $460 billion, up from $400 billion. Despite market volatility from economic data and upcoming US elections, favorable conditions like stable muni/Treasury ratios and narrowing credit spreads support strong issuance. Year-to-date issuance has already reached $409 billion, a 43% increase over last year.
Oil prices declined, with West Texas Intermediate and Brent falling below $69 and $73 per barrel, respectively, as the US pushed for a cease-fire in the Middle East and China’s crude demand weakened. The market has not fully recovered from early-week drops due to easing fears of an Israeli strike on Iran’s energy assets. Meanwhile, the International Energy Agency forecasts a potential oil surplus in 2024 as global supply increases.
Stocks ended Friday with modest gains, as the S&P 500 and Dow reached new highs, while the Nasdaq rose 0.6%. Investors are optimistic, with projections that the S&P 500 could rise to 6,200, a 30% gain for the year. Next week is crucial, as third-quarter earnings could extend the market’s six-week winning streak, amid favorable conditions like steady job growth and declining oil prices. However, risks include potential election-related volatility, escalating Middle East tensions, and the threat of unexpected market disruptions.
The 6M Euribor decreased with 1 basis point to 3.04% compared to previous business day. The 10Y Swap decreased with 3 basis points to 2.36% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
In the Eurozone, consumer prices rose slightly less than previously reported, with a year-on-year inflation rate of 1.7% for September, down from 2.2% in August. The European Central Bank aims for an inflation rate around 2% and lowered official interest rates with 0.25%. Core inflation remained at 2.7% year-on-year, with a monthly increase of 0.1%. Service inflation was reported at 3.9%, decreasing from 4.1% in the previous month.
The unemployment rate in the Netherlands remained steady at 3.7% in September, with 377,000 unemployed individuals. Over the past three months, an average monthly increase of 2,000 unemployed were reported. At the end of September, 172,300 unemployment benefits were registered by UWV.
Turkey’s central bank maintained its key interest rate at 50% for the sixth consecutive month. Inflation in Turkey in September was around 49%, the lowest level since June 2023, compared to 52% in August.
The 6M Euribor decreased with 1 basis point to 3.05% compared to previous business day. The 10Y Swap increased with 1 basis point to 2.39% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
Hurricane Milton caused extensive damage in central Florida, with risk modeller Karen Clark & Company estimating $36 billion in insurance payouts. The storm underscores rising risks from extreme weather, with Moody’s projecting combined losses from Milton and Hurricane Helene between $35 billion and $55 billion. Despite initial fears, insurance and reinsurance shares rallied, yet the potential for increased premiums and market exits looms amid worsening climate-change impacts.
UK inflation fell unexpectedly to 1.7% in September, marking a three-year low and prompting a drop in the British pound and increased bets on further rate cuts this year. The lower inflation, influenced by reduced airfares and petrol prices, brings the rate below the BoE’s 2% target for the first time since April 2021. These developments may boost Sir Keir Starmer’s government ahead of a challenging budget.
Mexican President Claudia Sheinbaum reassured US business leaders about the stability of the US-Mexico-Canada Agreement (USMCA) and announced $20 billion in new investments. She advocated for minimal changes to the trade deal, emphasizing that the economies of the US and Mexico complement rather than compete with each other. Despite this, her controversial domestic agenda and the political uncertainty surrounding the upcoming US election have left investors cautious.
The 6M Euribor is unchanged at 3.06% compared to previous business day. The 10Y Swap decreased with 4 basis points to 2.38% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
