Fed’s Waller: Based on current data, a 25 bps cut is justified at upcoming meetingMore from Waller: Labor supply issues masking weakness in labor demandWhite House: Trump feels tehre was progress in meeting with PutinKremlin Aide:Call was substantive and open. Leaders discuss possible Tomahawk deliveriesUS EIA weekly crude oil inventories +3524K vs +288K expectedBOJ’s Shimizu says must tread carefully on normalizing policyBOJ’s Ueda: My view on global economy hasn’t changedChina foreign minister: China and US should conduct effective communicationsNAHB US October housing market index 37 vs 33 expectedOctober Philly Fed -12.8 vs +8.5 expectedUSTR Greer: China is taking actions as if it wants to decoupleCanada September housing starts 279.2K vs 255.0K expected
Markets:
Gold up $110 to $4319WTI crude oil down 81-cents to $57.46S&P 500 down 0.6%Bitcoin down 2.3%CHF leads, AUD lagsUS 10-year yields down 7.1 bps to 3.97%
Gold continues to be the most-remarkable story of the moment as the parabolic move accelerated today with a +$110 day and new record above $4300. The move was aided by falling Treasury yields but was otherwise a symptom of intense momentum. That buyers continued to buy every small dip despite a poor backdrop in equities was telling.
US equities started off strongly but the selling hit quickly. One drag was banks, after Zions Bancorp took a $50 million writedown on what appear to be fraudulent loans. That magnified worries about lending fraud following the First Brands’ bankruptcy. US-China trade worries are also weighing as a few more statements crossed today but otherwise there weren’t any real developments.
The comments from Waller didn’t move the needle much on rate expectations as he talked about 50 bps but also moving carefully. He continued the Fed theme of highlighting a weakening jobs market, adding to the sense that the FOMC saw the September jobs report before the government shutdown.
The euro made headway against the US dollar as lower yields and lower oil prices highlighted the opportunity for the Fed to cut rates more deeply. By the same token, the yen was strong as a BOJ official indicated no urgency to cut rates.
This article was written by Adam Button at investinglive.com.