- European indices finished today's session lower after unsuccessful rebound attempt as markets weighed the impact of an impending win by Italy's first right-leaning government since World War II, as well as Moscow's latest moves to annex the areas of Luhansk, Donetsk, Kherson, and Zaporizhzhia into Russia. Dax finished 0,46% lower, while CAC40 lost 0.24%.
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Major Wall Street indices erased early gains and are heading towards 5th losing session. Dow is trading 1.25% lower, the S&P 500 fell 1.15% and the Nasdaq 0.5% amid another set of hawkish comments from policymakers and
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Fed's Collins believes that inflation is most likely nearing or has already peaked, however additional tightening is needed to rein in stubbornly high inflation and cautioned the process will require some job losses. She also expects significantly slower growth in 2022, while next year's economic growth will also be slower.
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EURUSD pair hovers around its weakest level since June 2002 as remarks from ECB president Lagarde regarding neutral interest rates provided only short-term relief for market bulls.
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The British pound tumbled to record lows against the USD amid persistent concerns over the government's credibility and uncertainty over how the new mini-budget will be paid. The BoE issued a statement saying it will not hesitate to change interest rates as necessary to return inflation to the 2% target, however this did not provided support for GBP.
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BoE statement also lowered expectations regarding future rate hikes. Traders now expect a 150 bps rate hike in November compared to previous expectations of 200 bps hike.
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Currently USD and EUR are the best performing major currencies while NZD and GBP lag the most.
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Strong dollar and demand concerns caused by weak macroeconomic outlook put pressure on oil prices. WTI is testing major support at $76.50, while Brent broke below $83.00, a level not since mid-January 2022.
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Precious metals are also retreating as surging Treasury yields reflect expectations for tighter monetary policy. Gold fell to $1635 per ounce, hitting the lowest levels since April 2020, while silver plunged over 2.0% to $18.40 per ounce.
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Despite broad negative sentiment, major cryptocurrencies are holding firm, which may be a sign of weakening correlation between BTC and US100. Currently the king of crypto is trading around $19,000, while Ethereum managed to defend key support at $1300.
SILVER price fell sharply on Monday and broke below local support at $18.60 which coincides with 61.8% Fibonacci retracement of the upward wave launched in March 2020. If sellers manage to uphold current momentum, a downward move may accelerate towards key support at $17.50, which is marked with lower limit of the local 1:1 structure and recent lows. Source: xStation5
