📰 S&P, Dow Snap Four-Day Winning Streak; Fed Officials Divided Over Rationale for September Rate Hike

Key Snapshot

· 🏛️ Minutes from Fed’s September meeting reveal deep division among policymakers over the justification for rate hikes. Some participants warned against spillover risks from energy price shocks, while more hawkish officials flagged inflation driven by domestic demand.

· 📉 S&P 500 and Dow Jones ended their four-day winning run, and Nasdaq posted its first decline in six sessions. The yield on the 30-year US Treasury hit a 24-year high.

I. Market Outlook

Core Events

- Fed Officials Divided Over September Rate Hike Rationale: Meeting minutes show some policymakers argued for tightening to contain broader spillover from energy and commodity price shocks. Hardline hawks said rate hikes were necessary to fight emerging demand-led inflation. → 10-year US Treasury yield rose 1.3 bps to 5.284%; 30-year yield climbed 2.8 bps to 5.669%, hitting a 24-year peak.

- Major Indices Break Winning Streaks: S&P 500 and Dow halted four straight gains, Nasdaq fell for the first time in six trading days. → Dow -0.66% at 51180.17; S&P 500 -0.22% at 7801.75; Nasdaq -0.22% at 27538.69.

- Strong Demand at 10-Year US Treasury Auction: Bid-to-cover ratio hit 2.77, the highest since 2016. Overseas demand stood near record levels, easing selling pressure on long-dated bonds and briefly pulling the 10-year yield lower.

Exclusive View

The core debate in Fed minutes is not whether to hike, but why to hike: energy supply shocks versus demand-driven inflation. These two scenarios will lead to vastly different policy paths. The 10-year auction’s 2016-high bid-to-cover ratio is a critical signal; robust foreign buying suggests the selloff in long US Treasuries may pause temporarily. Samsung’s Q3 operating profit surged nearly eightfold, proving AI storage chips are being priced as strategic assets in corporate earnings.

II. Overnight Market Performance

—— US Equities: Dow -0.66% at 51180.17; S&P 500 -0.22% at 7801.75; Nasdaq -0.22% at 27538.69.

—— European Equities: Pan-European STOXX 600 fell 1%, erasing most gains from the prior three sessions.

—— Fixed Income: 2-year US Treasury yield down 3.51 bps to 4.889%; 10-year +1.32 bps to 5.255%; 30-year +2.8 bps to 5.669%, hitting a 24-year high.

—— Commodities: WTI Nov crude -1.30% at $88.28/bbl; Brent Dec crude -0.38% at $100.20/bbl. COMEX Gold -1.09% at $4113.8/oz; Silver -2.07% at $59.899/oz.

—— FX: 10-year US Treasury yield rose 1.3 bps to 5.284%.

—— Crypto: Bitcoin dipped below $83,000 to $83106; Ethereum dropped more than 4.8% to $2565.

III. Macro News

1. 🏛️ Fed Officials Divided Over September Rate Hike Rationale: Minutes noted some participants want to prevent widespread price spillover from energy shocks, while hawkish core officials favor hikes to counter rising demand-driven inflation.

Insight: The dispute centers on the root cause of inflation, not whether to raise rates. A demand-driven inflation reading would mean a longer tightening cycle.

2. 🛢️ IEA Accelerates Oil Reserve Release, 100 Million Barrels Remaining From March Commitment: EU states the release mostly fulfills prior pledges instead of adding new supply.

Insight: IEA stock releases aim to cap oil prices, but EU remarks show limited fresh supply. Oil trends still hinge on vessel passage through the Strait of Hormuz.

3. 📊 10-Year US Treasury Auction Bid-To-Cover Hits 2.77, Highest Since 2016: Overseas demand near record levels, easing selling pressure on long bonds and temporarily pulling the 10-year yield lower.

IV. Global Corporate News

1. 💾 Samsung Q3 Operating Profit 107.4 Trillion KRW, Surges Nearly Eightfold, Beats Analyst Forecasts: Earnings validate storage chips as AI strategic assets.

2. 🤖 Anthropic Unveils Claude Haiku 5.5 With 75% Lower Operating Costs: The cost-efficient small model rolls out ahead of its IPO, accelerating price competition across AI application layers.

3. 🤖 OpenAI Rolls Out GPT-6 Globally To 1.2 Billion ChatGPT Users: Enhanced safeguards against model jailbreak attacks.

V. Key Watchlist For Today

· 📊 US Initial Jobless Claims: Test of labour market resilience.

· 📊 US Treasury to auction $22 Billion of 30-Year US Treasuries.