Financial Breakfast on September 22: Panic eased, U.S. dollar fell and gold rose, waiting for the Federal Reserve's interest rate decision
On September 21, the U.S. dollar fell slightly from its high in the past month. Global markets rebounded on Tuesday. Investors are currently waiting for the results of the Fed's two-day policy meeting. Spot gold closed up by more than 10 US dollars at US$1,774.51 per ounce, US Treasury yields fell, and concerns about global economic growth also stimulated safe-haven buying. U.S. oil rose nearly 1% in late trading, and the intraday performance was turbulent. Concerns about tightening supplies concealed investors' worries about global economic conditions; API data showed that US crude oil inventories fell by 6.108 million barrels last week.

On Tuesday (September 21), the U.S. dollar fell slightly. After hitting its highest level since August 23 on Monday, the U.S. dollar moved up and down the flat plate. After the initial gains of Wall Street index stock indexes cooled down, the U.S. dollar once moved higher. Gold futures prices closed up for the second consecutive trading day. The fall of the U.S. dollar and concerns about the potential risks of the financial crisis supported the price of gold. Oil prices closed higher, and the market expects that the energy product inventory report released by the US Energy Information Administration this week will show that US crude oil inventories have fallen for the seventh consecutive week last week.
Commodity closing, COMEX December gold futures closed up 0.8%, at 1,778.20 US dollars per ounce. October West Texas Intermediate expired on Tuesday and closed up 27 cents to $70.56 per barrel. The more actively traded November contract rose 35 cents to close at $70.49 per barrel; delivery in November The Brent crude oil futures rose 44 cents to settle at $74.36 per barrel.
US stocks closed: the S&P 500 index fell 0.1% to 4354.19 points; the Dow Jones Industrial Average fell 0.2% to 33919.84 points; the Nasdaq Composite Index rose 0.2% to 14746.4 points; the Nasdaq 100 index rose 0.1% %, reported 15027.77 points; Russell 2000 index rose 0.2%, reported 2186.183 points.
Wednesday look ahead
time | area | index | The former value | Predictive value |
22:00 | Eurozone | September Consumer Confidence Index | -5.3 | -5.9 |
22:00 | America | Annualized total sales of existing homes in August (10,000 households) | 599 | 588 |
22:30 | America | Changes in EIA crude oil inventories in the week ending September 17 (10,000 barrels) | -642.2 | -325 |
22:30 | America | Changes in EIA gasoline inventories as of the week of September 17 (10,000 barrels) | -185.7 | -123.6 |
22:30 | America | Changes in EIA refined oil inventories in the week ending September 17 (10,000 barrels) | -168.9 | -115 |
11:00 The Bank of Japan announces interest rate decision
14:30 Bank of Japan Governor Haruhiko Kuroda held a press conference at 02:00 AM The Federal Reserve announced interest rate resolutions and announced a summary of economic forecasts at 02:30 AM Federal Reserve Chairman Powell held a press conference
List of major global markets
Following the biggest drop in four months the day before yesterday, the US stock market fell late on Tuesday, and traders assessed the risks of the Fed meeting this week. The S&P 500 index opened higher and fluctuated violently throughout the day. The industry, communications services and utilities sectors dragged down the benchmark index.
The market generally expects that the Fed will pave the way for reducing the scale of debt purchases at policy meetings. Adam Phillips, managing director of portfolio strategy at EP Wealth Advisors, said investors are still fidgeting and they are waiting for the Federal Reserve's monetary policy decision on Wednesday.
Precious metals and crude oil
Spot gold price rose more than US$10 late on Tuesday to close at US$1774.51 per ounce. Concerns about global economic growth stimulated safe-haven buying. The end of the Fed meeting on Wednesday may provide clues to the timetable for cutting economic stimulus.
David Meger, director of metals trading at High Ridge Futures, said that the safe-haven asset gold rose due to "recent worries about slowing global economic growth."
However, Kitco Metals senior analyst Jim Wyckoff said that the technical outlook for gold is “still bearish in the short term.” We may see short-term futures traders closing their positions before the end of the Federal Open Market Committee (FOMC) meeting. Carry out some short covering; Wyckoff said the positive impact of the falling U.S. dollar and rising crude oil prices also boosted gold prices.
The FOMC will issue a policy statement and new economic forecasts at the end of the meeting on Wednesday. Some analysts believe that the Fed may announce in the fourth quarter that it will start reducing asset purchases, which may push the price of gold down.
U.S. crude oil rose nearly 1% in late trading, and the intraday performance was turbulent. Concerns about tight supply masked investors' worries about global economic conditions; API data showed that US crude oil inventories fell by 6.108 million barrels last week, which also boosted oil prices. .
John Kilduff, a partner at Again Capital LLC, said there are supply problems in the market, and oil prices have resumed their rise in the past month, partly because the supply disruptions that occurred after the storm hit the United States have tightened the market. At the same time, it is expected that soaring natural gas prices will force more consumption to shift to oil, so demand has also become the focus of attention. In addition, according to Energy Aspects Ltd.'s estimates, the removal of travel restrictions in the United States may result in up to 200,000 barrels of aviation fuel demand per day. Part of the volatility in Tuesday's trading hours may be due to traders adjusting their positions before the expiration of October crude oil futures on the New York Mercantile Exchange.
Foreign exchange
The U.S. dollar fell slightly from its high in the past month, and global markets rebounded on Tuesday. Investors are currently waiting for the results of the Fed’s two-day policy meeting.
The US dollar index fell 0.04% to 93.21, having reached a high of 93.455 on Monday. After hitting the highest level since August 23 on Monday, the U.S. dollar moved up and down in the flat market on Tuesday. After the initial gains of Wall Street index stocks cooled down, the U.S. dollar once moved higher.
Investors pay attention to the Fed's policy statement on Wednesday to find any clues as to when the Fed will begin to scale back its large-scale bond purchase plan. This week, many central banks around the world will issue policy statements.
Edward Moya, senior market analyst at OANDA, said the market is trying to understand whether the reversal on Tuesday will continue. If risk appetite continues to improve, the dollar will fall further from its current level. But as to what decision the Fed will make, we can only wait and see further.
The U.S. dollar was supported before the Fed meeting this week. Economists interviewed expect that policymakers will send a signal that the Fed will postpone the reduction of its quantitative easing program until November.
The euro to dollar was unchanged at 1.1726. The U.S. dollar fell 0.19% to 109.23 against the Japanese yen; the British pound was quoted at 1.3659 against the U.S. dollar, up 0.01% during the day.
The Canadian dollar rose 0.02% to 1.2820 against the US dollar, ending its three-day losing streak. Before that, Canadian Prime Minister Trudeau was re-elected, but his party failed to win a majority in the parliamentary election.
International news
[US API crude oil inventories decreased by 6.108 million barrels in the week of September 17, Cushing crude oil inventories decreased by 1.748 million barrels, gasoline inventories decreased by 432,000 barrels, and refined oil inventories decreased by 2.720 million barrels]
[The UK is considering joining the US-Mexico-Canada Free Trade Agreement (USMCA), as hopes for a bilateral agreement with the US faded]
[The US House of Representatives Rules Committee approves the Equity Expenditure Bill and the Debt Ceiling Bill]
[The Fed's use of reverse repurchase tools on Tuesday was US$1.24 trillion, a record high for three consecutive days]
Domestic news
[Xi Jinping: China no longer builds new overseas coal power projects] President Xi Jinping attended the General Debate of the 76th UN General Assembly in Beijing on the 21st and delivered a speech entitled "Strengthening Confidence, Overcoming Times, and Building a Better World." "The important speech. Xi Jinping said: "China will strive to achieve carbon peaks by 2030 and carbon neutrality by 2060. This requires hard work, but we will do our best. China will vigorously support the development of green and low-carbon energy in developing countries. Newly build overseas coal power projects.” (CCTV News)
[Essence strategy: post-holiday adjustments are a good opportunity for a new round of rising market layout] Essence’s strategy team reported that from the perspective of external factors, the global risk aversion during the Mid-Autumn Festival holiday and the sharp decline in external markets may lead to short-term fluctuations in A-shares. . However, the FOMC meeting and the US debt ceiling issue are both short-term, and the possibility of accidents after the boots are lowered is low. Other external factors have little impact on China's economy and will not destroy the A-share core track investment logic. Therefore, any adjustments after the holiday are expected to bring new layout opportunities. In terms of configuration, it is recommended to seize the opportunities brought by possible post-holiday adjustments and expand the layout around the mid-term main line of “carbon neutrality”.
Bonus rebate to help investors grow in the trading world!