Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Fed Decision Day, Evergrande Limps on, Oil Inventories - What's Moving Markets

EconomySep 22, 2021 06:37AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters.

By Geoffrey Smith 

Investing.com -- The Federal Reserve may or may not announce the start of  asset 'tapering'. China's troubled real estate developer buys itself another couple of days' grace with creditors. FedEx (NYSE:FDX) disappoints badly with its earnings and guidance, and DraftKings (NASDAQ:DKNG) ups the ante for Entain. Germany's growth outlook dims, but oil prices surge as U.S. crude stockpiles fall to their lowest in three years in the wake of Hurricanes Ida and Nicholas. Here's what you need to know in financial markets on Wednesday, 22nd September.

1. Decision Day at the Fed

The Federal Reserve will conclude its two-day policy meeting and is expected by most analysts to give a strong signal that it will begin reducing its monthly bond purchases before the end of the year. Only a minority expects the process to begin immediately. 

Any detail about the precise start of ‘tapering’, and about how long the Fed thinks it will need to phase out asset purchases completely, will be decisive in how the market reacts.

Equally important will be any changes to the ‘dot plot’ projection of Fed officials’ expectations for future interest rates. The last one suggested no rate hikes until 2023 at the earliest, but fears that inflation is proving ‘stickier’ than expected may accelerate that timeline.

The policy statement is due at 2 PM ET (1800 GMT), with Chairman Jerome Powell’s press conference due half an hour later.

2. Evergrande lives to default another day

China Evergrande Group (OTC:EGRNY) said it had reached an agreement with holders of one of its mainland yuan-denominated bonds that would allow it to avoid falling into default.

The vaguely-worded statement removed the most immediate concern around the troubled real estate group but gave no indication of whether further interest payments on its dollar bonds would be honored on Thursday.  

Chinese stock and bond markets, which reopened Wednesday after a two-day holiday, fell initially but recovered later in the day. The People’s Bank of China ensured that the official yuan exchange rate remained flat at 6.44668 to the dollar. The PBoC left its prime rate unchanged at a policy meeting earlier in the day, while the Bank of Japan also left its key rate unchanged, as expected.

3 Stocks set to open higher; FedEx disappoints

U.S. stock markets are set to open higher later, as fears of a disorderly sell-off in China recede, but essentially in a holding pattern ahead of the Fed’s decisions and press conference.  

By 6:15 AM ET, Dow Jones futures were up 216 points, or 0.6%, while S&P 500 futures were up in line and Nasdaq 100 futures were up 0.4%.

Stocks likely to be in focus later include Draftkings, which has raised its offer for U.K.-based Entain (OTC:GMVHY) to over $16 billion, and FedEx, which badly missed earnings estimates with its quarterly results after the bell on Tuesday. General Mills (NYSE:GIS) heads a sparse earnings roster for the day.

4. German recovery postponed as election nears

The growth outlook for Europe’s biggest economy worsened as the Munich-based Ifo institute cut its forecast for 2021 to 2.5% from 3.3%, due to the impact of Delta-variant Covid-19 and the ongoing stresses on German industry’s supply chains.

Order backlogs have reached record levels in recent months due to component shortages, notably semiconductors.

The institute indicated however that the recovery is likely to be postponed rather than completely derailed. It raised its forecast for 2022 growth to 5.1% from 4.3%.

The forecasts come four days ahead of a poll which appears likely to see the center-right Christian Democrats lose their hold on power for the first time in 16 years. Opinion polls don’t give any clear indications as to what kind of coalition will be generated by the elections on Sunday.

5. Oil surges on sharp drop in U.S. inventories; EIA data due

Crude oil prices rose sharply after the latest inventory data from the American Petroleum Institute showed stockpiles still falling sharply in the wake of two hurricanes that disrupted the energy production and distribution complexes in the Gulf of Mexico.

The API said that crude stockpiles fell by 6.1 million barrels last week, far more than expected. The U.S. government’s data at 10:30 AM ET are thus likely to show inventories falling to a new three-year low.

By 6:25 AM ET, U.S. crude futures were up 1.6% at $71.62 a barrel, while Brent futures were up 1.4% at $75.38 a barrel.

Fed Decision Day, Evergrande Limps on, Oil Inventories - What's Moving Markets
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (7)
Lino Miranda
Lino Miranda Sep 22, 2021 9:10AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
“We are going to be monitoring markets to determine the appropriate pace of the taper”….
Sol Wein
Sol Wein Sep 22, 2021 8:50AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Buy your share of gold and silver boys and girls, this Fed has lost any control it thought it had.
Alan West
Alan West Sep 22, 2021 8:50AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Gold is tanking. The worst investment ever.
Ariff Afiq
Ariff Afiq Sep 22, 2021 8:49AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
hilang dari radar,radar dari camar
Me comment
Me comment Sep 22, 2021 8:20AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
No changes and no start date the economy and job growth don't warrant it.
Millennial Metals
Millennial Metals Sep 22, 2021 8:04AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
You can’t fix a debt problem with more debt and you can’t print your way to prosperity
AY Haych
AY Haych Sep 22, 2021 8:04AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
JPow would like to have a word...
Mehmet Aksarayli
Mehmet Aksarayli Sep 22, 2021 7:11AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
I wonder how many companies in trouble like Evergrande round the globe feels like its gonna pop but when and how big that must be trillion dollar question.
Victor Ng
Victor Ng Sep 22, 2021 7:11AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Pushing people to the edge won’t get you the money they owe you. Think bigger picture
cj go
cj go Sep 22, 2021 7:11AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
maybe they don't want money.. depends on the contract they agreed if bankruptcy
Bob Silva
Bob Silva Sep 22, 2021 7:11AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
All of them. all the market is a huge cake.. and the cake is a lie.
Jon Bal
Jon Bal Sep 22, 2021 7:11AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
There's never just 1 cockroach
Ebrahim Hossain
Ebrahim Hossain Sep 22, 2021 6:49AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
hello
Lisa Yulisa
Lisa Yulisa Sep 22, 2021 6:49AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
hello
Varun Kumar
Varun Kumar Sep 22, 2021 6:49AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email