Stock Market Update

The S&P 500 futures currently trade 27 points above fair value.

Asian markets finished mostly higher on Wednesday, with easing oil prices, stronger Chinese economic data, and renewed technology buying supporting sentiment. Japan's Nikkei 225 surged 2.1%, while the Topix gained 1.7%, led by SoftBank Group (+6.6%) following reports that OpenAI is seeking at least $30 bln in new funding, while Fujikura (+5.9%), Taiyo Yuden (+2.3%), and Kioxia (+1.2%) also advanced. China's Shanghai Composite rose 0.3%, while the Shenzhen Component slipped 0.1% after Beijing unveiled additional stimulus measures, including mortgage subsidies and expanded central-bank funding support, though investors still want stronger measures to boost domestic demand. China's September manufacturing PMI improved to 50.1 from 49.8, while the non-manufacturing PMI rose to 50.2 from 49.0 and the private RatingDog manufacturing PMI climbed to 52.1. Hong Kong's Hang Seng Index reversed early losses to gain 0.4%, supported by Wuxi Biologics (+5.1%), Z.AI (+4.6%), Akeso (+2.1%), and Xiaomi (+0.4%). Mainland Chinese markets will remain closed from October 1 through October 7 for the National Day holiday.

• In economic data:
  • China's September Manufacturing PMI increased to 50.1 (expected 50.1; prior 49.8).
  • China's September Non-Manufacturing PMI increased to 50.2 (expected 49.2; prior 49.0).
  • China's September Composite PMI increased to 50.7 (prior 49.5).
  • China's September RatingDog Manufacturing PMI increased to 52.1 m/m (expected 51.7; prior 51.5).
  • Japan's August Retail Sales increased 2.7% yr/yr (expected 3.3%; prior 3.7%).
  • Japan's August Industrial Production decreased 1.7% m/m (expected 1.4%; prior -0.2%).
  • Japan's August Housing Starts increased 6.1% yr/yr (expected 6.9%; prior 8.2%).
  • Japan's August Construction Orders decreased 3.6% yr/yr (prior -13.4%).
  • South Korea's August Retail Sales decreased 1.8% (prior -2.6%).
  • South Korea's August Industrial Production decreased 4.8% m/m (expected 0.5%; prior 0.5%) and 2.2% yr/yr (expected 4.0%; prior 4.0%).
  • Australia's August Building Approvals decreased 6.1% m/m (expected -1.6%; prior -1.9%).
  • Australia's August Monthly CPI Indicator increased to 4.00% (expected 4.10%; prior 3.50%).

European markets trade mixed, with easing energy-supply concerns providing some relief while fresh inflation data keeps the broader rate outlook in focus. Germany's DAX 40 slips 0.1% after an early gain, with Heidelberg Materials (+1.7%) and MTU Aero Engines (+1.6%) among the leaders while investors await German inflation data. France's CAC 40 falls 0.4% after September consumer inflation accelerates to 3.0%, its highest since February 2024, while household goods consumption declines 0.5% in August. Airbus (+1.4%), Safran (+1.3%), and L'Oréal (+0.8%) advance, while TotalEnergies (-2.4%) and Publicis (-1.1%) lag. London's FTSE 100 gains 0.1% after second-quarter UK GDP growth is revised up to 0.5% from 0.4%, with Severn Trent and United Utilities (+3.0%) and Antofagasta (+3.2%) leading strength. Improved Middle East energy flows and another release from US emergency reserves are pressuring crude prices, weighing on BP (-1.7%) and Shell (-1.0%) while providing some relief from the energy-driven inflation pressures hanging over global markets.

• In economic data:
  • Germany's August Retail Sales increased 1.3% m/m (expected 1.6%; prior -3.2%) and decreased 0.4% yr/yr (expected 0.1%; prior -2.2%).
  • Germany's August Import Price Index increased 1.0% m/m (expected 0.6%; prior 0.2%) and 8.3% yr/yr (expected 8.0%; prior 6.8%).
  • Germany's September Unemployment Rate was 6.4% (expected 6.4%; prior 6.4%).
  • Germany's September Unemployment Change was 12K (expected 1K; prior 5K).
  • The U.K.'s Q2 GDP increased 0.5% qtr/qtr (expected 0.4%; prior 0.6%) and 1.4% yr/yr (expected 1.2%; prior 0.9%).
  • The U.K.'s Q2 Business Investment increased 1.8% qtr/qtr (expected 1.7%; prior 3.0%).
  • The U.K.'s Q2 Current Account deficit was GBP19.9 billion (expected GBP25.6 billion; prior GBP21.1 billion).
  • France's September CPI decreased 0.3% m/m (expected -0.5%; prior 0.7%) and increased 3.0% yr/yr (expected 2.8%; prior 2.4%).
  • France's August PPI increased 1.0% m/m (prior 1.3%) and 4.8% yr/yr (prior 3.5%).
  • France's August Consumer Spending decreased 0.5% m/m (expected 0.0%; prior 0.4%).
  • Italy's September Consumer Confidence fell to 91.2 (expected 94.0; prior 94.5).
  • Italy's September Business Confidence increased to 91.9 (expected 90.5; prior 90.2).
  • Italy's September CPI increased 0.7% m/m (expected 0.2%; prior 0.5%) and 4.2% yr/yr (expected 3.8%; prior 3.3%).