The latest Market Talks covering FX and Fixed Income. Published exclusively on Dow Jones Newswires throughout the day.
2020 ET - Japanese stocks are lower in early trade, weighed by concerns about the Iran conflict and higher energy costs. Chip-related stocks and trading houses are leading declines. Tokyo Electron Ltd. is down 2.7% and Marubeni is 1.7% lower. The dollar is at 154.48 yen, compared with Y154.22 as of Monday's Tokyo stock market close. Investors are closely watching developments in the Middle East and crude oil prices. The Nikkei Stock Average is down 0.2% at 63338.88. (kosaku.narioka@wsj.com; @kosakunarioka)
2019 ET - Indonesia's finance minister pick, Suahasil Nazara, looks credible to OCBC economists, who note his technocratic background and extensive policymaking experience. The announcement wasn't entirely unexpected, given speculation regarding a ministerial reshuffle. Moreover, the prior finance minister's policy measures delivered--at best--mixed results, OCBC's Lavanya Venkateswaran and Ahmad A Enver say. Suahasil's main challenge will be to keep the fiscal deficit below the 3% of GDP ceiling. That seems manageable, but complicated by the need to balance President Prabowo's growth ambitions against limited fiscal space and an increasingly tough external environment. As oil prices rise again, Indonesia's fuel subsidy bill could reach as much as 1.1% of GDP, necessitating expenditure cuts, OCBC says. (fabiana.negrinochoa@wsj.com)
2010 ET - Long-term Japanese government bond yields rise, driven by concerns about higher prices of energy and other products. A rise in domestic yields has come after escalating fears over energy prices and inflation drove the 10-year U.S. Treasury yield above 5% overnight. Investors are focusing on developments in the Middle East ahead of the Fed and Bank of Japan policy meetings later this week. The 10-year JGB yield is 1.5 basis points higher at 3.000%. (kosaku.narioka@wsj.com; @kosakunarioka)
1948 ET - Japanese stocks may decline as concerns about the Iran conflict and energy costs continue. Nikkei futures are down 0.2% at 63125 on the SGX. The dollar is at 154.36 yen, compared with Y154.22 as of Monday's Tokyo stock market close. Investors are focusing on developments in the Middle East and crude oil prices. The Nikkei Stock Average fell 0.8% to 63492.99 on Monday. (kosaku.narioka@wsj.com)
1859 ET - Dave & Buster's Entertainment has adjusted its pricing strategy to simplify the customer experience and try to get consumers to stay longer, CEO Darin Harper tells analysts on a call. Customers have reported that the kiosk where they buy a card to use for arcade games is confusing and the price structure is difficult to figure out, Harper says. The company has simplified the kiosk experience and adjusted pricing to allow guests to play for longer. So far, time spent on the gaming floor is up 20%, Harper says. This helped boost revenue from food and dining during the quarter, as well, he says. (katherine.hamilton@wsj.com)
1851 ET - Australian stocks look set to move lower at the open, following U.S. equities into the red amid higher oil prices and elevated bond yields. Local stock futures are down by 0.2% ahead of Tuesday's session, suggesting that the S&P/ASX 200 will reverse from a week-opening 0.1% advance that snapped a four-day losing streak. The benchmark index is 3.6% lower so far this month. Ahead of the open, coal miner New Hope reported a 63% fall in annual profit. Wealth manager Netwealth said it agreed to acquire advice platform Paradino for up to 29 million Australian dollars. In the U.S., the DJIA lost 0.3%, the S&P 500 fell 0.5%, and the Nasdaq Composite gave up 0.6%. (stuart.condie@wsj.com)
1846 ET - Dave & Buster's Entertainment says it has had a decline in groups coming without children. The new executive team is looking to drive demand from adults to visit, without alienating families, Chief Executive Darin Harper says on a call with analysts. Halloween will be an early opportunity for the company since the holiday falls on a Saturday this year and is a high-spending day for consumers. "It creates this unique opportunity for our business to serve family demand earlier in the day and then convert into a differentiated adult occasion at night," Harper says.(katherine.hamilton@wsj.com)
1621 ET - Macquarie Group economist David Doyle says the firm now believes the Bank of Canada is set to raise rates in October, citing firmness in month-over-month readings of core inflation. Overall, Macquarie expects the BOC policy rate to hit 3.5% by the end of 2027, or 125 basis points higher than its present level. Doyle says items related to shelter have been a driver for subdued year-over-year readings. That seems to be shifting, he adds, citing month-over-month increases in rents, and a pickup on a 12-month basis in owned accommodation, which incorporates the cost of maintain a residence and its market value. Excluding owned accomodation, core CPI has accelerated to 2.6% on a 12-month basis. (paul.vieira@wsj.com; @paulvieira)
1552 ET - Treasury yields give back early increases and settle just below Friday levels, as investors grapple with volatile oil prices and their potential impact on the global economy. Crude futures rise 1%, cooling from a pace as fast as 5% in early trade. A dollar rally also slows during the day. Markets now price 93% odds of a Fed hike Wednesday, according to LSEG. The 10-year yield drops 0.014 percentage point to 4.960%, after rising above 5% in the morning for the first time since 2023. The two-year declines 0.010 point to 4.632%, after hitting its highest level since 2024. Both snap a five-day rising streak. (paulo.trevisani@wsj.com; @ptrevisani)
1510 ET - Roblox used its annual developers conference to highlight expansion of its catalog to browser and App Store-based games, an offline playing option, and an AI game development tool for non-technical creators, Wedbush says in a note. The company needs to retain developers and show investors a path back toward accelerating growth, and its updates at the conference were a start, the analysts say. "Roblox has a substantial opportunity ahead and is laying the groundwork well," they write. "We need more evidence on the monetization side, and specifically on the timeline for these initiatives to show up in bookings, before turning more constructive." They keep a perform rating but raise their price target to $48 from $40. Wells Fargo and Bank of America also lift their price targets on the stock. Shares gain 11%.(elias.schisgall@wsj.com)
1415 ET - Royal Bank of Canada chief economist Frances Donald and her team say they are cautiously optimistic about the Canadian outlook despite uncertainty swirling about US-Canada trade. She forecasts sub-2% growth this year and next but argues the economy is stronger on a per-capita basis amid stalled population growth. The commodity-rich provinces in western Canada are leading the charge on growth. RBC expects four Bank of Canada rate hikes next year, taking the policy rate to 3.25%, due to concern over higher energy prices and an improving economy. Still, Donald adds "there are growing risks that [the] first hike could come" later in 2026. (Paul.Vieira@wsj.com; @paulvieira)
1359 ET - Markets are now treating a single inflation print as the primary determinant of policy, EY-Parthenon chief economist Gregory Daco says. In recent speeches, he says some policymakers expressed the view that if core PCE inflation trends around 0.2% month-over-month, they would not favor a rate hike. Against this backdrop, the 0.3% month-over-month increase in core CPI in August was interpreted as implying a 0.3% month-over-month advance in the Fed's preferred core PCE gauge, he said. Daco added that with such a reading above the implicit threshold for rate hikes, market odds of a rate hike surged.
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