Stock Market Update

The S&P 500 futures currently trade 10 points above fair value. 

Asian markets finished mixed on Tuesday, with elevated oil prices and global bond yields weighing on Japan and Hong Kong while expectations for additional policy support lifted mainland Chinese equities. Japan's Nikkei 225 fell 0.5%, while the broader Topix dropped 1.7% amid renewed inflation and tightening concerns, with SoftBank Group (-3.4%), Mitsubishi UFJ (-3.5%), Sumitomo Mitsui (-4.0%), and Toyota (-3.5%) among the notable decliners. China's Shanghai Composite gained 0.2%, while the Shenzhen Component rose 0.3% on expectations that Beijing could accelerate government bond issuance and increase fiscal support. Cambricon Technologies (+2.6%), Suzhou Dongshan Precision (+1.7%), and Agricultural Bank of China (+1.2%) advanced ahead of Wednesday's manufacturing PMI reports. Hong Kong's Hang Seng Index declined 0.5%, pressured by higher oil prices, elevated Treasury yields, and continued weakness in Chinese technology shares, with Geely (-7.4%), Xiaomi (-2.6%), Meituan (-2.0%), and Tencent (-1.8%) retreating. Investors also remain cautious ahead of China's National Day holiday, while Brent crude around $106 continues to reinforce inflation and interest-rate concerns across the region. Relatedly, the Reserve Bank of Australia raised its key policy rate by 25 basis points to 4.60%, as expected.

• In economic data:
  • The Reserve Bank of Australia raised its key policy rate by 25 basis points to 4.60%, as expected.
  • Japan's July Leading Index increased 1.5% m/m (expected 1.7%; prior 0.0%).

European markets trade higher, with technology, healthcare, and mining shares providing support despite elevated oil prices and bond yields. Germany's DAX 40 gains 0.7%, led by Infineon Technologies (+2.2%) and Siemens Energy (+1.7%) amid renewed AI enthusiasm, while Fresenius Medical Care (-2.0%) falls after Berenberg cut its price target and withdraws its buy recommendation. France's CAC 40 rises 0.1%, with Legrand surging 6.1% after raising its 2030 targets on stronger data-center and energy-transition demand, while STMicroelectronics (+2.6%), Schneider Electric (+2.3%), and Stellantis (+1.2%) also advance. London's FTSE 100 gains 0.2%, supported by AstraZeneca and GSK (+2.0%) and strength in miners including Antofagasta, Anglo American, Glencore, Fresnillo, and Rio Tinto, which rise between 1.4% and 2.0%. UK shop-price inflation eases to 1.4% year-over-year in September from 1.5% in August, while National Grid (-1.4%) and energy shares lag. US-Iran negotiations remain a key macro focus, with the lack of diplomatic progress keeping crude prices elevated while global bond yields remain near multi-year highs.

• In economic data:
  • Eurozone's September Consumer Confidence was -16.5 (expected -16.5; prior -16.5).
  • Eurozone's September Industrial Sentiment was -3.8 (expected -4.8; prior -5.0).
  • Eurozone's September Business and Consumer Survey was 97.9 (expected 99.0; prior 98.4).
  • Spain's September CPI increased 0.3% m/m (prior 0.7%) and 4.9% yr/yr (expected 4.6%; prior 4.3%).
  • Italy's August PPI increased 2.4% m/m (prior 2.3%) and 10.9% yr/yr (prior 7.7%).
  • Italy's July Industrial Sales increased 1.7% m/m (prior -0.9%) and 4.8% yr/yr (prior 3.2%).
  • U.K.'s August Mortgage Approvals totaled 54.92K (expected 56.00K; prior 55.93K).
  • U.K.'s August BoE Consumer Credit totaled GBP2.464B (expected GBP1.900B; prior GBP2.097B).
  • U.K.'s September Shop Price Index increased 1.4% yr/yr (expected 1.5%; prior 1.5%).