In US economic data, the S&P Global manufacturing purchasing managers’ index (PMI) fell from 52 to 49.9 in October (survey: 51). The S&P Global services PMI eased from 49.3 to 46.6 in October (survey: 49.5). And the Chicago Fed national activity index was steady at 0.10 in September (survey: -0.10).
European sharemarkets rose on Monday, with the continent-wide FTSEurofirst 300 index closing up by 1.2%, as investors looked ahead to a key interest rate decision by the European Central Bank (ECB) later this week. The S&P Global Eurozone composite PMI fell from 48.1 to a 23-month low of 47.1 in October (survey: 47.6). The UK FTSE 100 index rose by 0.6% as investors welcomed Rishi Sunak’s victory in Britain’s prime ministerial race.
US sharemarkets advanced on Monday as shrinking US business activity lifted investor hopes of a less aggressive monetary policy approach by the US Federal Reserve. Shares of HCA Healthcare jumped 7% after reporting solid third quarter results on Friday. But gains on the technology heavy Nasdaq index were capped as Tesla shares fell 1.5% after the electric vehicle maker cut the price of its Model 3 and Model Y cars in China. And shares of some Chinese companies listed in the US dropped after Beijing tightened President Xi Jinping’s grip on power. Shares of Alibaba shed 12.5%, JD.com shares slid 13% and Baidu shares dropped 12.6%. The Dow Jones index closed up by 417 points or 1.3%. The S&P 500 index gained 1.2% and the Nasdaq index rose by 93 points or 0.9%.
US treasuries dropped on Monday (yields higher), as bond traders remained sceptical about a significant change in the US Federal Reserve’s policy stance, despite economic data pointing to a slowdown in US business activity in October. US 10-year yields rose by around 3 points to near 4.24%. And US 2-year yields lifted by around 2 points to near 4.51%.
Major currencies were mixed against the US dollar in European and US trade. The Euro rose from lows near US$0.9806 to highs near US$0.9889 and was near US$0.9870 at the US close. But the Aussie dollar eased from highs near US63.46 cents to lows near US62.73 cents and was near US63.10 cents at the US close. And the Japanese yen firmed from 149.44 yen per US dollar to JPY148.66 and was near JPY149.00 at the US close.
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Global oil prices fell by around 0.5% on Monday as data showed crude demand from China remained lacklustre in September. China’s September crude imports of 9.79 million barrels per day were 2% below a year earlier, according to customs data. The Brent crude oil price fell by US24 cents or 0.3% to US$93.26 a barrel. And the US Nymex crude oil price lost US47 cents or 0.6% to US$84.58 a barrel.
Base metal prices were mixed on Monday. Copper slid 0.4% as investors worried about the pace of economic growth in China and the yuan fell to its weakest versus the US dollar since 2008, making dollar-priced commodities costlier for Chinese buyers. Aluminium fell by the most, down 1.4%, but nickel rose by 1.4%.
The gold futures price fell by US$2.20 an ounce or 0.1% to US$1,654.10 an ounce. Spot gold was trading near US$1,650 an ounce at the US close. Iron ore futures fell by US35 cents or 0.4% to US$94.51 a tonne.
Originally published by CommSec