Morning wrap (01.09.2022)

• US indices had another downbeat session in a row. S&P 500 dropped 0.78%, Dow Jones moved 0.88% lower and Nasdaq declined 0.56%. Russell 2000 dropped 0.62%

• Indices from Asia-Pacific followed into footsteps of their US peers and also moved lower. Nikkei dropped 1.5%, S&P/ASX 200 moved 1.7% lower while Kospi plunged 2%. Indices from China traded up to 1.5% lower

• DAX futures point to a lower opening of the European cash session

• According to Wall Street Journal, G7 will outline a plan to cap Russian oil prices on Friday

• China has put Chengdu city with 21 million population under lockdown amid spike in local Covid-19 cases

• Reuters quoted Taiwan Defense Ministry saying it has shot down Chinese drone near Kinmen islands. Report was later corrected to state the drone was unidentified, not necessarily Chinese and not necessarily military

• A Singaporean-flagged tanker ran aground in the Suez Canal. However, ship was refloated within hours and supply chain disruptions, like those from 2021, were avoided

• According to Reuters report, OPEC sees oil market surplus at 400k bpd in 2022, instead of 900k bpd that was reported by media yesterday

• United States put restrictions on sales of Nvidia's data center chips used in artificial intelligence to China and Russia

• Chinese manufacturing PMI (Caixin) dropped from 50.4 to 49.5 in August (exp. 50.2)

• Australian private capital expenditure dropped 0.3% QoQ in Q2 2022 (exp. 1.5% QoQ)

• Cryptocurrencies are pulling back amid an overall increase in risk aversion. Bitcoin drops 0.9% and tests $20,000 area while Ethereum trades 1.3% lower

• Oil is trading little change on Thursday morning with Brent trading near $95 per barrel

• Precious metals trade lower amid USD strengthening - silver drops 1.2% while gold trades 0.2% lower

• USD and AUD are the best performing major currencies while NZD and EUR lag the most

Brent (OIL) plunged back below 200-session moving average yesterday and continued to move lower afterwards. Declines were halted near the $95 per barrel for now and oil is trading little changed today. Source: xStation5