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The MORNING BID Europe-BOJ is still in place, but with a hawkish spin
Ankur Banerjee gives us a look at what the future holds for European and global markets The Bank of Japan's expected hold rounded off the central bank bonanza of this week, which has seen stocks soar and the currency markets subdued. Meanwhile, the dollar remains soft as investors are still uneasy about global interest rate outlook. BOJ's decision was not unanimous, however, with two dissenting voices suggesting that policymakers disagree on when to raise interest rates next. The markets are now focusing on BOJ Governor Kazuo UEDA's press conference, where they will be looking for clues about the rate outlook as well as more information on the central banks plans to sell their holdings in ETFs and Real Estate Investment Trusts (REIT). The Nikkei fell after hitting another record high earlier during the session. Other Asian markets followed Wall Street's lead after the Federal Reserve lowered rates, as expected, earlier this week. However, comments by Chair Jerome Powell, were measured and didn't hint at a rapid reduction of borrowing costs. Don't say it to the stock market. Taiwan's benchmark stock index reached another record high Friday, after Wall Street's major indexes also scaled new records. European futures suggest a subdued opening after Thursday's strong session. The Bank for International Settlements (BIS), which is the umbrella group for all central banks in the world, has warned that the record-breaking global share prices are becoming increasingly unconnected with the growing concerns over government debt levels on bond markets. Investors expect the dollar to weaken in the short term. Remember that the U.S. dollar has fallen more than 10% in value this year, so its further decline may be limited. The focus will be on the interest rate and the reaction to the BOJ's decision throughout the session, as there is little economic data available during European hours. Nvidia, which has pledged $5 billion to Intel in support of the struggling U.S. semiconductor maker, will also be a focus for European tech stocks. The following are key developments that may influence the markets on Friday. Economic events: UK retail prices for August and Germany August producer price
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Asia shares set for weekly gains, Nikkei retreats after BOJ decision
On Friday, Asian shares rose on the back of hopes for further rate cuts in the global economy. Meanwhile, the Nikkei fell from its record highs as the Bank of Japan signaled a further winding down of its massive stimulus policy. The BOJ has maintained Short-term interest rates Two members voted to increase the rate. The company also decided to begin selling its large holdings in exchange-traded fund (ETF) or real estate investment trusts. After the decision, the dollar fell 0.4% to 147.48yen. Japan's Nikkei, after hitting a record in the early trading, reversed its gains and was down last 0.4%. This brought Japan's weekly gain down to only 0.8%. Now, the focus is on BOJ Governor Kazuo ueda's scheduled news conference at 0630 GMT. The data showed that Japan's core rate of inflation was 2.7% for the year ending August. This is the lowest pace in nine month, but it still exceeded the central bank's target of 2%. In the first part of this week, central banks were in The United States Canada Norway Cut interest rates while the Bank of England held steady. James Rossiter is the head of global macro strategy for TD Securities. We expect many central banks to cut their risk appetites at their next meeting, despite the fact that there is still a lot of uncertainty. South Korea's benchmark stock index fell 0.6%, but remained near its record high. The index was up by 1.3% this week, which brings the two-week total to more than 7%. MSCI's broadest Asia-Pacific share index outside Japan fell 0.1%, but was still on track for a 0.7% weekly gain. It is not far off its four-year highs. On Friday, stock options, stock index options, and stock index futures expire all on the same date, resulting in increased trading and possible market volatility. Nasdaq and S&P futures both remained unchanged. Hong Kong's Hang Seng remained flat, ahead of a phone call between President Donald Trump (left) and Chinese counterpart Xi Jinping expected later that day. Investors have a lot to consider before that call. A deal on TikTok could be close, China's Huawei has announced its chip plans and Beijing has ordered tech firms to not buy Nvidia AI chips. The benchmark S&P 500 index, Dow Jones and Nasdaq closed overnight at new records, boosted by improved jobless claims and news that Nvidia would invest $5 billion into the struggling U.S. semiconductor maker Intel. Intel shares soared 23% while Nvidia rose 3.5%. The dollar recovered on the foreign exchange market after the Fed made its first cut in 9 months. The dollar index remained at 97.28 after plummeting to a multiyear low of 96.224. The pound remained at $1.3557 after slipping 0.6% overnight, as the BOE left rates at 4%. The Norges Bank lowered rates overnight and indicated that rates may continue to drop. The 10-year Treasury yields remained at 4,1102% on the bond market after gaining 3 basis points over night. The yield on the 10-year Japanese Government Bond jumped by 4 basis points to 1.635%. This is just shy of this month's record high of 1.64%. Oil prices on commodity markets were stable after falling in the previous session. U.S. crude oil was barely changed at $63.60 per barrel, while Brent crude was unchanged at $67.47. The spot gold price increased by 0.4% to $3,658 per ounce.
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Iron ore to gain weekly on increased steel demand
The iron ore futures market advanced on Friday, and is expected to finish the week higher due to a strengthening steel demand as well as pre-holiday stocking in China, a major consumer. As of 0258 GMT, the most traded January iron ore contract at China's Dalian Commodity Exchange rose 0.56%. It now stands at 805.5 yuan (113.23 dollars) per metric ton. The contract has risen 0.88% this week. The benchmark September Iron Ore at the Singapore Exchange is 0.22% higher, now $105.5 per ton. However, it has fallen 0.19% this week. The steel sector is benefiting from the continued growth in demand for ferrous metals as the peak season approaches. Restocking before the Chinese National Day holiday also helps to support the industry. Steel prices may rise if downstream demand is stronger than expected in October. This was stated by broker Galaxy Futures. According to Mysteel's data, China's stocks of major carbon steel products decreased by 0.3% between September 12-18 compared to the previous week. They now total 4,18 million tons. According to Hexun Futures, a Chinese financial information website, the average daily hot metal production, which is an indicator of demand for iron ore, increased by 171,900 tons over a year ago to 2.41 million metric tons. The capacity utilization rate in blast furnaces also rose, rising 6.29 percentage points to 90.35 percent. The National Bureau of Statistics reported that China, the world's largest producer of crude iron ore, increased its production by 8.8% in August, to 81.63 millions tons. Meanwhile, crude steel output fell for a third consecutive month due to a slowing demand. Coking coal and coke, which are used in steel production, both fell by 0.04% and 0.06 percent. The Shanghai Futures Exchange steel benchmarks were mixed. Hot-rolled coils fell by 0.21% and stainless steel dropped by 0.27%. Rebar and wire rod gained 0.32% and 0.12% respectively. $1 = 7.1138 Chinese yuan (Reporting and editing by Eileen Soreng; Lucas Liew)
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Cadeler to Install Turbines at Ocean Winds’ Polish Offshore Wind Farm
Danish offshore wind installation firm Cadeler has signed a firm contract with Ocean Winds for the transportation and installation of 26 Siemens Gamesa 14 MW offshore wind turbines at the BC-Wind offshore wind farm in the Polish Baltic Sea. The signing of this firm contract follows the Vessel Reservation Agreement (VRA) signed in February 2025 between Cadeler and Ocean Winds.The installation is set to start in 2028 and to continue for approximately four months. Cadeler will deploy one of its O-class wind turbine installation vessels and will operate from the Port of Gdańsk in Poland.When fully completed, BC-Wind will have a total capacity of up to 390 MW, supplying clean electricity to nearly half a million Polish households.The project is located about 23 km from the Polish coastline, north of the Pomeranian Voivodeship. It is Ocean Winds’ first project in Poland and will play an important role in the country’s ambitious offshore wind plans. “With this firm contract now signed, we are ready to bring our best-in-class fleet and experienced crews to support Ocean Winds on this important project. Poland is establishing itself as a key offshore wind market in Europe, and this project will be a significant step in strengthening the country’s renewable energy ambitions.“We look forward to expanding our presence in the Polish Baltic Sea, building on the strong pipeline of projects we have already secured in the region,” said Mikkel Gleerup, CEO of Cadeler.
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Gold prices flatten as investors wait for more Fed signals after widely anticipated cut
The gold price was flat on Friday, as the Federal Reserve failed to meet investors' expectations of further easing. Markets were also waiting for more clues about the U.S.'s policy direction. As of 0311 GMT, spot gold had not changed much at $3646.23 an ounce. Bullion reached a record-high of $3,707.40 per ounce on Wednesday. The price of U.S. December gold futures was also unchanged at $3,678.90. "Sentiment has definitely cooled down a little bit, but it is still bullish." "The Fed did not really provide the dovish advice needed to drive gold higher," Capital.com Analyst Kyle Rodda stated. Rodda said that the forecast of only a single cut in 2026 is above the market price and has resulted in a rise of yields and the US dollar. We need to do something to change this dynamic and get gold back to its previous solid performance above $3,700. "Some weak U.S. statistics would probably be enough." The Fed cut rates again on Wednesday, and while it opened the door for further easing, its message was tempered with warnings about sticky inflation. This raised doubts over the pace of future rate cuts. Fed Chair Jerome Powell described the policy as a risk management cut in response the weakening of the labour market. He said that the central bank is in a situation where it has to "meet-by-meeting" about the rate outlook. According to the CME Group’s FedWatch tool, traders are pricing in 92% of another 25 basis-points reduction at the Fed’s October meeting. Low rates reduce the cost of holding bullion that does not yield. Data showed that the number of Americans who filed new claims for unemployment benefits dropped last week. However, labour market conditions softened due to a decrease in demand and supply. Platinum gained 0.2% at $1,386.10 and spot silver increased 0.7% to 42.11 dollars an ounce. Palladium was on its way to a weekly decline, having gained 0.6%, or $1,157.49. It has lost 3.3% this week. (Reporting and editing by Sumana Naandy in Bengaluru, Brijesh Patel from Bengaluru)
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Nikkei records record, Asian shares end week of central banks with gains
The Nikkei soared to a new record as the Bank of Japan opted not to raise rates again. This week, the central banks of the United States of America, Canada, and Norway all cut their interest rates, while the Bank of England remained unchanged. Bank of Japan's easy monetary policy is expected to remain unchanged Friday despite domestic political uncertainty. James Rossiter is the head of global macro strategy for TD Securities. We expect many central banks to cut their risk appetites at their next meeting, despite the fact that there is still a lot of uncertainty. Nikkei rose 0.7% on Friday to reach another record high before the BOJ meeting. This brought the weekly increase to 2%, after a 4% rise the previous week. The Japanese yen remained at 148 per $1. The data showed that Japan's core rate of inflation was 2.7% for the year ending August. This is the lowest pace in nine month, but it still exceeded the central bank's target of 2%. Chang Wei Liang is a FX & credit analyst at DBS Group. He said that given the political uncertainty, a BOJ interest rate hike could be delayed until the results of the LDP's leadership elections on the 4th October. He said that the LDP candidate Sanae Takaichi's comments, which she will make at a presser later on Friday, to explain her policy, may have an impact on the yen, given her preference for a monetary and fiscal policy that is accommodative. South Korea fell by 0.4%, but remained near its record high. The week-over-week gain was 1.5%, which brings the two-week total to almost 8%. MSCI's broadest Asia-Pacific share index outside Japan fell 0.3% on Friday, but it is still expected to rise by 0.5% weekly. It is not far off its four-year highs. On Friday, stock options, stock index options, and stock index futures expire all on the same date, resulting in increased trading activity and possible market volatility. Nasdaq and S&P futures both remained unchanged. Hong Kong's Hang Seng fell 0.3%, as the Hang Seng slipped 0.2% ahead of a phone call expected between President Donald Trump with his Chinese counterpart Xi Jinping. Investors have a lot to consider before the meeting, with a possible deal on TikTok, China's Huawei revealing its chip plans and Beijing ordering tech companies not to purchase Nvidia AI chips. The benchmark S&P 500 index, Dow Jones and Nasdaq closed overnight at new records, thanks to better data on jobless claims and news that Nvidia would invest $5 billion into the struggling U.S. semiconductor maker Intel. Intel shares soared 23% while Nvidia rose 3.5%. The dollar recovered on the foreign exchange market after the Fed made its first cut in 9 months. The dollar index remained at 97.42 after plunging as low as 96.224, a multi-year record. The BOE held rates at 4%, and the pound lost 0.6% over night. Dollar gained 0.9% against the Norwegian crown following the Norges Bank's rate cut and indication that rates may continue to drop. The 10-year Treasury yields remained at 4,1102% on the bond market after gaining 3 basis points overnight. Oil prices on commodity markets were stable Friday after falling in the previous session. U.S. crude oil was barely changed at $63.60 per barrel, while Brent oil was unchanged at $67.47. Gold spot prices are held at $3.647 per ounce.
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Demand concerns outweigh US rate cuts buoyancy
The oil prices were not much different on Friday, after they had been lower the previous day, the day following the U.S. Federal Reserve's first interest rate cut this year due to concerns about fuel demand in America. Brent crude futures fell 1 cent to $67.43 per barrel at 0100 GMT. U.S. West Texas intermediate futures dropped 4 cents to $63.53. Both benchmarks are on course to finish higher for the second consecutive week. The Fed lowered its policy rate on Wednesday by a quarter-point and said that more cuts were coming as a response to signs of weakness within the job market. Low borrowing costs usually boost oil demand and drive prices higher. The market was expecting a 1 million barrel increase. However, the U.S. stockpiles of distillate increased by 4 million barrels. This raised concerns about demand and pushed prices up. Tony Sycamore, IG's analyst, said that gains in the USD and U.S. Long-End Yields have further weakened support for crude oil. The dollar index increased by 0.43%, reaching 97.37. It strengthened by 0.52% against the Swiss Franc to 0.793 and grew 0.67% against the Japanese yen to 147.95. Data on the economy has also raised concerns. The latest data on jobless claims released this week showed that the U.S. labor market is softening, as both demand and supply are falling. Single-family home construction also plunged in August to a nearly 2-1/2 year low amid an oversupply of new homes. The Russian Finance Ministry has announced a new initiative to protect the state budget against oil price fluctuations as well as Western sanctions. This will ease some supply concerns. Daniel Hynes, an ANZ analyst, said that President Trump's statement that he prefers low prices to sanctions against Russia eased supply disruption concerns. (Reporting and editing by Tom Hogue; Sudarshan Varadahan)
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Zijin Gold to launch Hong Kong's biggest IPO in 2025, $3.2 billion
According to a prospectus published on Friday, Zijin Gold International is a wholly owned unit of China’s mining giant Zijin Mining and aims to raise HK$24.98billion ($3.21billion) through a Hong Kong Initial Public Offering, making it the largest offering of this kind in Hong Kong so far this year. The prospectus stated that Zijin Gold will sell 349 million shares for HK$71.59 each. Trading in shares is expected to begin on the stock exchange on September 29. Zijin Gold would be the biggest IPO in Hong Kong for this year. It would surpass Chery, a Chinese automaker, which offered on Wednesday. Chery aimed to raise $1.2 billion. The battery giant CATL raised $4.6 billion on May 15, the largest Hong Kong listing ever. In the prospectus, Zijin Gold, the company that owns all the gold mines of Zijin Mining outside China, stated it plans to use the proceeds of the sale over the next five-year period to upgrade and construct existing mines, as well as to enhance production. Morgan Stanley and CITIC Securities jointly sponsor the offering. According to Zijin, the spin-off of Zijin Gold International and its independent listing will improve financing efficiency and broaden financing channels. ($1 = $7.7771 Hong Kong Dollars) (Reporting and editing by Alan Barona in Hong Kong & Sherin Sunny, Bengaluru)
As Chinese holiday shoppers return to restock, copper prices rise
Copper futures recovered on Friday after a week-low in the previous session. This was supported by an improving demand from the top consumer China, as lower prices encouraged buyers back to the market to replenish for the holiday break.
As of 0406 GMT, the most traded copper contract at the Shanghai Futures Exchange had risen 0.19% to 79,950 Yuan ($11,239.04). On Thursday, the contract reached a low of more than a week.
The benchmark three-month copper price on the London Metal Exchange increased by 0.37%, to $9976.5 tonne.
Analysts said that downstream consumers' buying interest has improved as a result of a fall in prices. The National Day holiday is approaching and this will support the price.
As the copper price has dropped and China's National Day is approaching, downstream buyers are on a bargain hunt.
Analysts at broker Maike Futures stated that "the expectation of further production cuts by smelters during September and October" also helped to boost the price of red metal, which is used in construction and power.
Analysts at broker GF Futures say that Chinese smelters could be forced to reduce production as the price of sulfuric acid byproduct, which had offset losses caused by low processing fees and record-low prices, has dropped.
A stronger dollar has slowed the price increase. This is because buyers who use other currencies are forced to pay more for commodities that are priced in greenbacks.
Investors are also awaiting the outcome of a phone call that took place on Friday between U.S. president Donald Trump and Chinese president Xi Jinping.
Other SHFE metals saw a slight increase in aluminium, 0.17%. Lead advanced by 0.15%. Nickel and zinc were unchanged, while tin fell 0.57%.
$1 = 7.1136 Chinese yuan $1 = 7.1336 Chinese Yuan (Reporting and editing by Dylan Duan; Amy Lv, Lewis Jackson)
(source: Reuters)