Heavy Weather
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What is the impact of Hurricane Milton on US market sentiment this morning?
Well, the focus in the US today will be less on the inflation numbers, which are out later, and more on the storm which hits Florida any moment now. I guess for the implications for markets will be, as Rodrigo was suggesting yesterday, how Biden and the Democrats cope with the emergency aid and how much political mileage Donald Trump will get out of it, which all seems rather callous when so many lives are at risk. Meanwhile, oil prices are going the opposite to the way you'd expect, given all of that. China is gonna have another crack at a stimulus announcement at the weekend and the RBNZ does their big cut yesterday. Could the next one be even bigger? There's a logical reason to suggest well, maybe it might.
It's Thursday, it's the tenth of October 2024. It's the morning call from NAB. Good morning. Uh a 0.4% rise in the US dollar. The Aussie dollar is down 0.4% as well to below 67.2 US cents. The Euro is also down 0.4%. So there's a bit of a symmetry to all of this. Down 0.3% for the pound. The yen, though, that's down 0.7%. Bond yields are higher again, up another five basis points for 10-year treasuries, up to 4.06%, up four basis points in Canada, but just one or two basis points. Tire for most of Europe. Aussie 10 years yesterday closed off at 4.19%. Now on futures more like 4.21%. Shares are up again. The Dow closed up 1%, 0.7% for the SP, both finishing on record highs and closing close to their session highs as well.
0.6% up for the Nasdaq and the Russell 2000 is up a quarter percent. Big rises in Europe as well, almost 1.5%. percent up for the DAX, 0.7% for the Eurostocks fifty and the FTSE one hundred. Yesterday the CSI three hundred fell seven percent, but we know why. So much promise, so little delivered from Beijing. In the US, Alphabet shares still not doing that well. Down an over two percent today on the back of that ruling that uh Google has to open up its Play Store to competitors. But that could actually go further.
How are global oil prices reacting to the storm and Chinese stimulus expectations?
The reports now that the antitrust officials Want Google to make its search data available for others as well. Crikey. And oil down today, despite Hurricane Milton, what's being called the storm of the century bearing down on Florida as we speak, with millions evacuated. Even so, WTI is down 0.4%, Brent is down 0.8% to 7650 a barrel. The falls were deeper than that earlier in the session. So JB Weir's Sally All. is uh with me today. So Sally, oil still falling. I guess it's you know the storm might have had some impact, but uh but you know it might have fallen further. But I'm guessing this is a reaction to to China still. There was also a big rise in oil inventories as well overnight in the United States.
Uh so that might be part of it. Five point eight million barrels added versus two million expected. Or is there something else going on here with oil?
Morning, Phil. No, I think you've you've hit the nail on the head. So so obviously um a bit of a reassessment, at least in the very short term, about, you know, China, because the market had probably got ahead of itself in terms of how quickly any fiscal stimulus was announced. And, you know, over the course of the last week, sort of felt like expectations were ratcheting up with some people talking about the possibility of a ten trillion dollar uh sorry, one stimulus. Which seems a little bit um a little bit excessive. Um and we've heard nothing on on that. So as you mentioned, that hasn't gone too well for Chinese equity markets. But I think really the story probably more about inventories in the very short term.
As you said, they were up more than expected for the weekend of the fourth of October. So the combination of, you know, a little bit more supply than expected. Um in the system and a bit more uncertainty about, you know, the the intentions of Chinese policymakers, probably enough just to take some of the the heat out of oil prices.
But then going the other way, we've got the uncertainty over what's going to happen in the Middle East. So uh news this morning that Joe Biden has been speaking with Benjamin Yanyahu, actually apparently the first time they've spoken uh since August.
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Chapters
4 chapters
1
What is the impact of Hurricane Milton on US market sentiment this morning?
0:01–1:58
2
How are global oil prices reacting to the storm and Chinese stimulus expectations?
1:58–8:53
3
Why are oil inventories rising and could that explain the recent price drop?
8:53–15:13
4
What did the latest FOMC minutes reveal about inflation and employment risks?
15:13–15:25