General Market Analysis – 24/10/24

US Stock Markets Plunge – Nasdaq Drops 1.60%

All three major US indices fell in yesterday’s trading as uncertainty surrounding the upcoming US election weighed heavily on the markets, with investors also looking ahead to key updates and a less dovish Federal Reserve. The Dow dropped by 0.95%, the S&P 500 by 0.92%, while declines in big tech stocks saw the Nasdaq tumble 1.60%. Treasury yields continued their upward trend, reaching levels not seen in three months, with the 2-year yield rising by 4.7 basis points to 4.084%, and the 10-year by 3.6 basis points to 4.242%. Oil prices fell in response to a stronger-than-expected US inventory report, with Brent down by 1.42% to $74.96, and WTI dropping 1.35% to $70.77. Gold, after its relentless rise, saw a 1.2% decline on the day, closing at $2,714.55 by the New York session’s end.

Stock Market Volatility Expected to Increase Ahead of US Election

Equity traders are preparing for heightened volatility in the lead-up to the US election, which is now only 12 days away. Investors are considering a variety of possible outcomes as the race tightens, with many expecting significant market movements depending on shifts in the political landscape. With all three major US indices currently trading near record highs, the stage is set for potential dramatic moves and headlines in the coming weeks. A clear Trump victory is widely anticipated to apply pressure on the US market, while a Harris win is seen as more favourable. However, post-election political manoeuvring adds complexity, and many agree this could only increase market volatility.

PMI Day Hits the Markets Today

A wave of Flash Manufacturing and Services PMI figures is due across various trading sessions today, with investors closely watching the data for fresh insights into the health of global economies. Updates are expected from Australia, Japan, France, Germany, the EU, the UK, and the US, with particular attention on Eurozone figures after poor data last month weighed heavily on the currency. The US session will also feature the usual weekly unemployment claims, alongside New Home Sales data. Meanwhile, emerging markets players will be keeping an eye on the news wires for any final updates from the closing day of the BRICS summit.

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