In US economic data, the Dallas Fed manufacturing index fell from -12.9 to -17.2 in September (survey: -9). The Chicago Fed national activity index fell from 0.29 to 0 in August (survey: 0.23).
European sharemarkets were mixed on Monday. The panEuropean STOXX 600 index fell by 0.4%. Italy’s FTSE MIB index rose by 0.7% after the centre-right coalition led by Georgia Meloni won a clear majority in both houses of parliament. Germany’s Dax index slid 0.5% after German business sentiment fell further in September. The Ifo index dropped to 84.3 from 88.6 in August (survey: 87). The UK FTSE 100 index was flat but the UK FTSE 250 mid-cap index dropped 1.4% to near 2-year lows after the British pound fell to a record low against the greenback.
US sharemarkets fell on Monday as investors worried that the US Federal Reserve’s aggressive campaign against inflation could throw the US economy into a sharp downturn. The US dollar soared to a record high and US government bond yields hit fresh 12-year to 15- year highs. Shares of Baker Hughes (-5.9%), Halliburton (-5.2%) and
Chevron (-2.6%) all slid as crude oil prices hit 9-month lows. But shares of casino operators Wynn Resorts (+12.0%) and Las Vegas Sands (+11.8%) soared after Macau announced plans to open to Chinese tour groups in November for the first time in three years. The Dow Jones index closed lower by 330 points or 1.1%, finding a new intraday low for the year during the trading session. The S&P 500 index slid 1.0%, reaching a new closing low for 2022. And the Nasdaq index lost 65 points or 0.6%.
US treasuries were weaker on Monday (yields higher) after US Federal Reserve officials Susan Collins, Lorie Logan and Raphael Bostic all said that tackling inflation was the central bank’s top priority. The US Treasury sold US$43 billion of 2-year notes at a yield of 4.29% into weak demand. US 10-year yields rose by around 22 points to 12-year highs near 3.92%. And US 2-year yields lifted by around 12 points to 15-year highs near 4.33%.
Major currencies were weaker against the US dollar in European and US trade. The Euro fell from highs near US$0.9699 to lows near US$0.9599 and was near US$0.9610 at the US close. The Aussie dollar dipped from highs near US65.31 cents to lows near US64.38 cents and was near US64.55 cents at the US close. And the Japanese yen fell from near 143.58 yen per US dollar to JPY144.78 and was near JPY144.65 at the US close.
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Global oil prices fell by around 2.5% on Monday to 9-month lows, pressured by a strengthening US dollar as traders awaited details on new sanctions on Russia. The Brent crude oil price fell by US$2.09 or 2.4% to US$84.06 a barrel. And the US Nymex crude oil price slid by US$2.03 or 2.6% to US$76.71 a barrel.
Base metal prices slumped on Monday. Copper fell by 1.2% as fears of a global slowdown, weaker demand, a higher US dollar and climbing stocks in London Metal Exchange registered warehouses sparked a sell-off. Nickel lost 5.4%, but tin gained 1.9%.
The gold futures price shed US$22.20 an ounce or 1.3% to a 2½- year low of US$1,633.40 an ounce. Spot gold was trading near US$1,622 an ounce at the US close. Iron ore futures rose by US12 cents or 0.1% to US$99.01 a tonne.
Originally published by CommSec