On October 22, the market remains clouded by trade tensions and concerns over a potential U.S. government shutdown. U.S. stock index futures exhibited mixed performance, while major European indices opened lower and Asian stocks largely retreated due to declines in technology shares. The dollar strengthened, U.S. Treasury yields remained flat, gold and silver prices fluctuated, and cryptocurrencies broadly fell.
In the previous trading session, gold and silver prices plummeted due to profit-taking, technical corrections, and easing geopolitical crises. Spot gold prices briefly dropped 6.3%, marking the largest intraday decline in over a decade, and currently, spot gold is experiencing significant volatility. Suki Cooper, head of commodity research at Standard Chartered Bank, stated that technical sell-offs are the primary reason for the dip, noting that gold prices have remained in overbought territory since early September. The bank also expects gold prices to regain upward momentum next year.
U.S. stock index futures were mixed, with S&P 500 futures rising nearly 0.1%, Dow futures increasing 0.04%, and Nasdaq 100 futures slightly falling by 0.01%. Netflix saw a pre-market drop of over 6% due to Q3 earnings significantly missing expectations and a lowered full-year guidance.
Major European indices opened lower, with the Euro Stoxx 50 down 0.27%, the FTSE 100 up 0.44%, the CAC 40 down 0.29%, and the DAX 30 down 0.04%. The dollar index surpassed 99 for the first time since October 15. The yield on 10-year U.S. Treasury bonds remained flat at 3.96%. Spot gold fell below $4070 per ounce, with a 30-minute decline exceeding $70 per ounce. Bitcoin dropped nearly 0.4%, and Ethereum fell close to 0.9%.
As U.S. stock index futures presented mixed signals, this week has seen improvements in corporate earnings bolstering market sentiment; however, uncertainties regarding trade prospects and the looming U.S. government shutdown continue to weigh on investor concerns. Former President Trump has injected new uncertainties into trade negotiations. This impending government shutdown is set to become the second longest in U.S. history, causing delays in the release of official data, including September inflation figures that were scheduled for release on Friday.
Investors are currently focused on Tesla (TSLA), which is set to announce its earnings on Wednesday, marking the start of key earnings reports from the "Big Seven Tech" companies. Investors will be keen on updates regarding the federal electric vehicle tax credit expiration and developments concerning the launch of its autonomous taxi service.
Spot gold has fallen below $4070 per ounce. This decline has abruptly halted the rapid upward momentum seen since mid-August, as gold faced its most severe sell-off in years during the previous trading session. Supported by market risk aversion and expectations for Federal Reserve rate cuts, gold prices have risen nearly 60% this year.
Although the volatility of spot prices has now stabilized, traders are utilizing options to hedge against further price fluctuations. The one-month implied volatility has surged to its highest level since March 2022, indicating that investors are preparing for potential price swings. Ongoing geopolitical uncertainties keep gold prices in a range-bound trading pattern. Although recent "TPE meetings" have been canceled by the U.S., Hungarian Prime Minister Orban announced that preparations for a peace summit with Russian President Putin in Budapest are still ongoing, although no date has been set. Orban noted that Foreign Minister Szijjarto is advancing preparations in Washington.