The stock exchanges today, 25 October. The positive phase of the markets continues. Uncertainty China, yuan at a low
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MILAN – The push on Western financial markets continues, waiting to see if the ECB will actually raise rates by 0.75% on Thursday as most expect and if the news on the American GDP will force the Fed to slow down its tightening, as some have they hope.
The optimism that for the moment filters through the quarterly data (a fifth of the companies from the S & P500 have so far published the results and in more than half of the cases they have been surprising in the positive, notes Bloomberg) pushed Wall Street last night and Asia to new highs this morning.
Instead, tension remains high in China after the party congress that gave full power to Xi. A reflection of the many uncertainties around Beijing (authoritarian squeeze, confirmed “zero Covid” policy, hard punch on the market economy) can be seen in the weakness of the yuan traded outside the country, which has been at a low since the beginning of 2010 prices. Meanwhile, the Central Bank of China (PBOC) has set the currency’s onshore exchange band at the weakest level in 14 years.
Tokyo sprinting in the wake of Wall Street: + 1%
The Tokyo stock exchange closed higher, benefiting from the good progress achieved yesterday by Wall Street, on hopes of a slowdown in US rate hikes. The benchmark Nikkei 225 index posted + 1.02% to 27,250.28 points, while the Topix index advanced 1.06% to 1,907.14 points.
Stable opening for the euro
Stable opening for the euro on the currency markets. The single European currency changes hands at 0.9875 dollars (+ 0.01%). Sterling remained at 1.12 when the change of government in the UK is going smoothly. In Asia, where the Chinese yuan has hit a 15-year low, the yen is trading at 148.9 after the Tokyo government intervened in recent days to support the currency.
Oil, slightly higher prices
Oil prices slightly higher in trading on Tuesday, after yesterday’s decline marked by recession fears. The WTI marks + 0.3% to 84.85 dollars, while the Brent rises by 0.2% to 93.47 dollars a barrel. The decline in the dollar favored the recovery in prices, however moderated by the continuing fears of a slowdown in demand from the two largest consumers, the United States and China.
Ubs and Hsbc, count on expectations
Ubs Group beats estimates and closes the third quarter with a net profit of 1.75 billion euros (1.73 billion dollars) thanks to the increase in interest rates that helped offset the slowdown in the global economy and the market volatility. In the quarter, the Swiss bank recorded a decline in revenues of 10% to 8.3 billion euros. Profit before tax increased by 4% compared to a year ago, reaching 1.5 billion euros. Recurring commission revenues fell 14% and advisory revenues fell 58%. In wealth management, total revenues were down 13% compared to a year ago, with a 10% drop in management fees.
Accounts above analysts’ expectations also for HSBC, despite having recorded a 46% decline in net profit in the third quarter of 2022 to 1.913 billion dollars, compared to the previous 3.543 billion. The gross profit in turn marks a -42% to 3.15 billion. The decline is linked to the reclassification of retail assets in France in the category of assets held for sale, the group indicates in its financial report. The appointment of Georges Elhedery as CFO makes him a strong candidate for the Noel Quinn top succession.
Wall Street closed higher last night pending Microsoft and Google
Wall Street closed higher last night, extending its best week since June series. Today, the attention will be mainly for the quarterly, in particular for those of Microsoft and Alphabet, expected after the close of the markets. Investors are hoping for a softer Fed on interest rates after the Wsj he wrote that the opinion would begin to circulate among bankers that it is time to slow down the pace of the squeeze so as not to cause too much damage to the economy. The discussion will be open at the next meeting on November 1st and 2nd, when the fourth consecutive hike of 75 basis points should be decided in order to try to curb inflation.
The Dow Jones closed up 418.05 points (+ 1.34%), the S&P 500 finished the session with a gain of 44.93 points (+ 1.20%), the Nasdaq composite added 92, 90 points (+ 0.86%).
China, weakness weighs on the yuan: lows in 15 years
The Chinese yuan today hit a 15-year low against the dollar today, with investors worried about President Xi Jinping’s growing power following the Communist Party Congress. The onshore yuan fell 0.6% to 7.3084 per dollar, the weakest level since December 2007 and close to the lower end of the trading band set by the central bank on Tuesday. The offshore yuan – which circulates outside mainland China and is more freely traded than the currency in the domestic market – fell to 7.3735 against the dollar, the weakest since clearing banks in Hong Kong kicked off. free to open renminbi accounts freely in 2010. The Chinese currency has also slipped in view of future interest rate hikes by the Federal Reserve. The announcement over the weekend that Xi had secured a third term as party leader sparked fears among investors that Chinese authorities would continue blocking policies to counter Covid that have impacted the economy.
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