From Marc to Market:
Overview: Ahead of the much-anticipated speech by Federal Reserve Chair Powell, the Fed funds futures are pricing in about a 70% chance of a 75 bp hike next month. The US 10-year yield is up nearly five basis points today to 3.07% and the two-year yield is firm at 3.38%. Asia Pacific equities were mostly higher, with China the main exception among the large markets, after US equities rallied yesterday. Europe’s Stoxx 600 is off about 0.3% to bring this week’s loss to a little over 1%. It would be the first back-to-back weekly loss in two months. US futures are seeing yesterday’s gains pared. Europe’s benchmark 10-year yields are mostly 4-8 bp higher. The greenback is mixed with the European currencies mostly higher, led by the euro, pushing above parity where options for 1.5 bln euros expire today. The dollar bloc and yen are nursing losses. The firmer euro tone appears to be lending support to the central European currencies, while the South African rand and Thai baht are off a little more than 0.5% to pace the declines.
Gold set the high for the week yesterday near $1765 and is struggling to stay above $1750 today. October WTI is up 1% today and 3.4% for the week. It posted an outside down day yesterday to fall 2.5% but is consolidating quietly today. Europe’s natgas benchmark is off 0.5% to pare this week’s gain to around 25.2% after rallying 20.3% last week. US natgas is gaining for a third day, up 2.2%. It was nearly flat on the week coming into today. Iron ore rose almost 3% to bring this week’s gain to 5.2%, the strongest weekly advance this month. September copper is up 1.4% after yesterday’s 1.5% advance. December wheat is firm after a four-day rally was snapped yesterday. Poor weather is seen behind the week’s 3% gain....
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