Marcus Today Pre-Market Podcast – Friday 13th October

Wall Street finished in the red overnight after a US treasury auction sent bond yields higher, and CPI data came in hotter than expected. September monthly headline CPI came at 0.4%, higher than consensus of 0.3%, down from 0.6% in August. Headline YonY remained unchanged at 3.7%, although higher than expectations of 3.6%. Monthly Core CPI rose 0.3% in line with expectations, while annualised core inflation came in at 4.1% down 0.2% from August. Rising energy and shelter costs largely contributed to the elevated inflation reading. The Dow fell 174 points (-0.51%). Dow up 59 points at best. Dow down 349 points at worst. The S&P 500 and the NASDAQ broke four straight days of gains although still on track to post weekly gains, down 0.62% and 0.63%, respectively. An auction for 30Y bonds showed poor demand, sent Treasury yields higher, 10Y yield up 13.7bps and 2Y yield up 8.2bps. USD is up 0.71%, and the VIX rose 3.5%. On the corporate front, Ford (-2.04%) says its offer of a 23% raise to UAW is the best that it can do. Delta Air fell 2.3% after cutting its outlook for 2023 on rising fuel prices, and Dominos Pizza (-1.1%) reported revenue for Q3, missing analyst expectations.

• ASX to fall. SPI Futures down 58 points (-0.81%).
• Gold eased as the USD and treasury yields rose, down 0.29%.
• Nickel bounced, up 1.85%, after hitting its slowest level since July 2022.
• Base metals are broadly lower, pressured by a stronger USD. Copper -0.47%, Aluminium -0.43%, Zinc -1.49%, Lead -1.81%, and Tin +0.06%.
• 10Y yield: US 4.70%, Australia 4.37%, and Germany 2.78%.
• Oil prices mixed overnight. Brent Crude up 0.35% and WTI fell 0.99%. After a large build in US crude stockpiles outweighed expectations that interest rates had peaked.

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