September 10, 2026
Equity indices finished mostly lower during the Asian session with the Hang Seng leading the decline falling 1.25%. The Nikkei managed to finish slightly higher despite some hawkish talk from BoJ member Masu who said “To complete the normalization of monetary policy in Japan, I am convinced that the Bank needs to raise the policy interest rate further.” That sums it up nicely, expect a hike next week and maybe more hawkish guidance as well. Australia’s ASX dropped 1% as Australian consumer inflation expectations remain high (4.9% YoY) while reports out of China note that China’s NDRC is holding discussions with reps from 60 different U.S. companies including Amazon and Nvidia to gather input for China’s next five year plan. Reports also note that China is willing to hold AI discussions with the U.S. despite competition over AI models. European bourses closed lower after today’s expected ECB rate hike. The ECB raised rates 25 bps and left door open for additional hikes as soon as October with Lagarde acknowledging the ECB has been surprised by longer lasting inflation. Brent crude is higher, European natural gas prices are near three year highs and storage levels don’t look great. Does the ECB keep hiking to fight rising energy prices that they have little control over, or is today more of a one and done since costly energy will bring about demand destruction and slow the EU economy. Neither sounds like a terrific option. Global interest rates continued to break out, spurred by rising energy prices, ECB action, and pre-election promises by President Trump. The Houthis captured control of a key port city, potentially giving them more leverage over the Bab el-Mandeb Strait, sending Brent above $105/barrel and WTI above $100/barrel. U.S. PPI data painted a familiar picture as well, with input prices running well above the Fed’s target. The U.S. 10-year climbed above 4.9% and the 2-year topped 4.5% while rates climbed across Europe too. Despite strong demand in the 30-year bond reopening at 1pmET, U.S. bond yields extended even higher after the Treasury’s enhanced buyback operation accepted only $5.2B of the up to $6B of long dated maturities it had targeted. Futures markets once again predicted a Fed rate hike next week and another rate hike by the ECB next month. The S&P 500 dipped back below 7600 and its 50-day moving average for the first time since late July. Copper prices rolled over following a report that the White House was rethinking plans for potential sector tariffs.
* Nikkei +0.20%
* Shanghai -0.43%
* Hang Seng -1.27%
* DAX -0.84%
* FTSE -0.57%
* CAC -0.69%
* DJIA -0.60%
* S&P 500 -0.58%
* Nasdaq -0.65%
* Russell 2000 -1.04%
* BSD Global Tech Hedge Fund -0.25%