Two major themes shaped today’s market narrative: the looming US government shutdown and surprisingly (but positive) developments out of the Middle East.
On the political front, the White House unveiled a plan during a press conference, aimed at ending the Gaza conflict, stressing that “no one will be forced to leave, and Israel will not occupy Gaza”—a proposal that fueled cautious optimism that the war may be nearing its end.
The US Dollar has been enjoying a renaissance of sorts this week with gains largely down to US data not being bad at all.
Looking at the data this week, the sales rate for US new homes spiked back to levels last seen in early 2022.
The British Pound has continued its recent malaise against the US Dollar after a stellar rally ahead of the US interest rate decision. Since the decision, Cable has been on a downward trend as the US Dollar has continued to gain traction.
The week starts on a grim note for cryptocurrencies when looking at the daily performance of most major altcoins.
Log in to today's North American session Market wrap for September 22
Markets started the week on the back foot today, but shook off early concerns as US tech shares continued their impressive rise.
This was fueled by a promise from Nvidia to invest up to $100 billion in OpenAI, boosting excitement around artificial intelligence.
US Equities keep up their positive performance with each of them finishing at or close to their highs, with the Tech-heavy Nasdaq taking the lead yet again.
With the most recent Federal Reserve cut and positive acquisition news as seen in yesterday's US Index piece, sentiment is at its highs again.
Oil prices dropped by over 1% after they had risen by almost 2% on Monday to start the week on the front foot. Traders are watching the war in Ukraine and the possibility of interruptions to Russia's oil supply.
Brent crude oil fell by $1.08, or 1.57%, to $67.72 per barrel. It had reached its highest price since early August just a day earlier. West Texas Intermediate (WTI) crude oil also dropped, losing $1.13, or about 1.74%, to $63.67.
Forex Markets are going bonkers since Powell's dovish speech at the Jackson Hole conference.
The US Dollar is getting sold off aggressively as the Market interpreted dovish signs for a cut in the September, even in a relatively nuanced speech – Markets didn't need much!
The Reserve Bank of New Zealand (RBNZ) is expected to cut interest rates by 0.25% this week, bringing the rate to 3%. This would mark a total reduction of 2.5% during the current cycle. Markets are also predicting another cut later this year or early next year, possibly lowering the rate to 2.75% or even 2.5%.
USD/CAD advances in the US session, trading above the 100-day MA as the potential for further gains grows. There are of course headwinds for the pair which could scupper a move higher in the coming days.
Yesterday's CPI report fueled even more fire to the ongoing relentless rally in US Equities. Up a respective 46% and 34% from their Liberation Day lows, both the Nasdaq and S&P 500 keep beating expectations.
This morning's US CPI report came almost exactly in line, and the fact that there wasn't much diversion from expectations led to traders decidedly pricing the 25 bps Cut for the Federal Reserve's September meeting.
Japan's Nikkei index hit a new milestone on Wednesday, crossing the 43,000 mark for the first time ever. The broader Topix index also reached a record high, following strong gains in Wall Street overnight and marking six straight days of growth.
After touching $4,000, a cascade of Saturday buying took the second largest crypto to $4,350 highs.
Ether is now consolidating around the $4,200 key handle – A consolidation at its highs is a more bullish sign, however for the Crypto Market to run higher, Participants will now look at the leading Crypto.
