Photographer: Akio Kon/Bloomberg
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Trump threatens North Korea, prepping for central bank decisions, and stocks sit at record highs. Here are some of the things people in markets are talking about.
Trump Threatens North Korea
It was one of the most talked about events of the day, even if it didn’t cause much of a move in markets. President Trump gave his first speech to the United Nations General Assembly, and in it, he threatened North Korea with annihilation and delivered a provocative argument that the U.S. and other nations should always put self-interest first. He continued to refer to Kim Jong Un as “Rocket Man, ” saying the North Korean leader was on a suicide mission from himself as well as his regime.
Bank of Japan
The Bank of Japan is predicted to stand pat when it reviews monetary policy Thursday. Governor Haruhiko Kuroda isn’t expected to reveal how or when the BOJ will eventually unwind its stimulus measures, but he could signal determination to keep the nation’s yield curve under control. Ten-year JGB yields has gone from a one-year high in February to slipping below the BOJ’s targeted zero percent level earlier this month amid a bout of global risk aversion stemming from North Korea tensions. Despite the BOJ cutting back on its debt purchases three times since mid-August, strategists aren’t sure if that will be enough to halt the yield decline.
All Eyes on Fed
The Federal Reserve meeting Wednesday is expected to result in an unchanged policy rate and the initiation of balance-sheet normalization. Since these outcomes are largely priced in, attention will turn to the description of the economy, economic projections and Chair Janet Yellen’s press conference. The tone is expected to lean dovish, so a surprise could come in a Fed that leans toward the hawkish side of policy spectrum.
All major U.S. indexes were up Tuesday as financial markets kept calm despite Trump’s speech to the UN. Focus now shifts to the Fed decision with stocks sitting at record highs. The yield on 10-year Treasury climbed about basis points to 2.2446 percent, and West Texas Intermediate crude fell for the first time in more than a week. The euro rose for a fourth day.
Besides keeping an eye on central banks decisions and continued UN coverage, we have New Zealand GDP and Singapore motor vehicle sales. Futures are mixed, with the Nikkei 225 edging lower and S&P/ASX 200 higher ahead of the open. Economic data will be relatively light, but central banks should keep markets busy.
What we’ve been reading
This is what caught our eye over the last 24 hours.
- China is planning to open up its financial sector.
- A powerful 7.2 magnitude earthquake strikes near Mexico City.
- Singapore’s leading newspaper publisher is no longer bigger than the New York Times.
- China Huarong Asset Management Co. is suspending new loans to Sunac.
- Toys ‘R’ Us bankruptcy caught some traders off guard.
- FANG stocks sinking hasn’t caused broader markets to suffer.
- Another Wall Street titan calls bitcoin a bubble.