The Fed could start reducing their monthly bond purchases as soon as next month
On Wednesday, the Fed released its minutes of the September monetary policy meeting. The central bank officials confirmed that if the economy continued to improve, they could start reducing their monthly bond purchases as soon as next month and bring them to an end by mid-2022. At the same time, some policymakers noted that uncertainty remained high. Following the release, the S&P 500 rose 0.3%, the Dow ended flat, and the tech-heavy Nasdaq gained 0.73%. As for earnings, JPMorgan Chase posted stronger-than-expected third-quarter earnings. However, the bank’s stocks finished 2.6% lower overnight.
Asian stocks were mostly higher on Thursday, with markets in Hong Kong closed for a holiday. The Shanghai Composite index was little changed after the report pointed to a surge in producer price inflation, which rose to a record 10.7% over a year earlier in September from 9.5% in August. Japan’s benchmark Nikkei 225 added 1.4%, South Korea’s Kospi jumped 1.34%. Hong Kong’s trading was closed for a holiday.
In Europe, equities opened higher today amid expectations of a strong earnings season. The pan-European STOXX 600 index rose 0.7% in early trading. U.S. stock futures rose in early premarket trade on Thursday. German Economy Ministry said a significant GDP increase is likely in the third quarter. However, bottlenecks in raw material delivery may keep hurting the industry in the coming months, the authorities added.
In currencies, the dollar gained in a knee-jerk reaction to the FOMC meeting minutes before turning lower across the board. Against this backdrop, EURUSD rallied to the 1.1600 handle, retaining a bullish bias early on Thursday. The GBPUSD pair registered October highs to retarget the 1.3700 figure as dollar demand has eased. US PPI and jobless claims figures are due later today.
