The dollar declined overnight, while U.S. stocks reversed course to close higher, as Williams stated there is currently no justification for further interest rate increases by 2027, alongside strong earnings from banking stocks.
New York Federal Reserve President John Williams said he still believes one more rate hike this year is appropriate, but at present, he does not see a need for the central bank to raise rates again in 2027.
In the third quarter, Wall Street’s fixed-income division underperformed, while equity markets capitalized on rare opportunities, outpacing other market participants.
Revenue from the stock divisions of the five largest U.S. banks is expected to exceed $66 billion over the first nine months of the year—about $3 billion higher than projected income from bond, foreign exchange, and commodity divisions. Part of this growth stems from prime brokerage services targeting hedge funds and other large equity investors.
Asian markets are focused on technology stocks, with Samsung Electronics and SK Hynix both rebounding after five consecutive days of declines. The sector faces a crucial test ahead, as chipmaker ASML Holding will release its earnings report on Wednesday, followed by TSMC on Thursday.
Meanwhile, Brent crude rose 0.7% to $106.41 per barrel amid renewed Middle East attacks that have heightened uncertainty over the recovery of energy shipping through the Persian Gulf. U.S. crude prices advanced for the fifth consecutive trading session.
Although Williams’ comments provided a brief reprieve ahead of the consumer price index release, markets remain concerned that geopolitical tensions could keep oil prices elevated, prolonging inflationary pressures. Traders are also closely watching corporate earnings for clues on the direction of artificial intelligence-related trades.
Plugin Case Highlights
Gold: The upward momentum continues. After breaking above the blue zone indicated by the plugin yesterday, gold surged toward 4,200. Today, continue monitoring such momentum signals. If it breaks above 4,170, look for potential targets at 4,180 and 4,200. However, consider reducing positions or exiting before the CPI data release.
(Gold 15-minute chart)
Nasdaq: Yesterday, our plugin signaled a buy stop upon breaking the blue zone, which proved effective. We also warned about a possible secondary pullback in offshore markets and potential liquidity sweeps—which indeed occurred. Today, we’ll monitor for rebound signals following any liquidity sweep near 30,500.
(Nasdaq 15-minute chart)
Crude Oil: The sell stop triggered by the blue zone break yesterday was ineffective. For today, we recommend waiting and observing. A short-term drop below 94 could trigger a correction, but we’ll wait for guidance from tonight’s CPI data, along with any sudden developments in the Middle East that could significantly impact prices.
(Crude Oil 15-minute chart)
Key Financial Data & Events Today:
20:30 U.S. September CPI
