Taiwan’s Biden, NAHB Survey, Crypto Fall – What Moves Markets

Taiwan’s Biden, NAHB Survey, Crypto Fall – What Moves Markets

By Jeffrey Smith – US President Joe Biden has again warned China that US forces will defend Taiwan in the event of an “unprecedented attack”. The United Kingdom closes its markets by bidding farewell to Queen Elizabeth II. Cryptocurrencies plummeted as investors lacked boldness from a week of aggressive central bank action, and Volkswagen estimates its Porsche unit at up to $75 billion. Here’s what you need to know in the financial markets on Monday, September 19th.

1. Biden Taiwan

President Joe Biden reiterated that US forces would defend Taiwan in the event of an invasion from China, prompting another angry reaction from Beijing.

Biden seemed to leave no room for misunderstanding, giving the same answer twice when pressed. However, the White House again felt the need to issue a separate statement at a later time reiterating that this was Biden’s personal view, not official US policy.

Historically, the United States has avoided taking a position on this issue, while offering its support to Taiwan in all other ways.

The question of how much the United States might risk war with the People’s Republic of China has become increasingly urgent this year as Beijing ramped up its rhetoric about “reunification” with Taiwan, at the same time that the United States offered significant military assistance to Ukraine to help it defend itself against attacks. Russian.

2. Cryptocurrency drops ahead of central bank meetings

It fell to its lowest level in three months at the start of a week that is likely to see significant tightening in global monetary policy.

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Momentum from the cryptocurrency has been waning since August in the US that fueled speculation that the Federal Reserve may raise its key by 100 basis points later this week, instead of the 75 basis point consensus. Other big gains are also expected from Sweden, Norway, Switzerland and the Bank of England.

It was not helped by the sense of failure due to the long-awaited failure of Ethereum’s “consolidation” which led to an immediate rebound in demand for the network token. Ether is down 9.3% overnight to a two-month low of $1,298.62, while Bitcoin is down 7.2% to $18,489.00.

3. Assignment of shares to extend losses upon opening; Volkswagen sets the Porsche rating range

US stock markets are set to open under the same cloud of reduced risk appetite, extending last week’s declines.

By 06:20 EST (10:20 GMT), it was down 301 points, or 1.0%, while it was down by the same amount and down 1.1%. The three monetary benchmarks lost between 4.8% and 6.7% last week, their worst week in three months.

Stocks likely to come into focus later include AutoZone (NYSE:), which is set to report earnings. Focus will also be placed on Volkswagen AG ADRs (OTC :), after the company announced the IPO price range for its Porsche unit. Volkswagen aims to value up to 75 billion euros ($75 billion) with the offer, which it hopes will unlock value and help fund its transition to electric mobility.

โ€œThe monthly housing market report is the only notable component of the data calendar.

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4. United Kingdom burial of Queen Elizabeth II

World leaders descended on London for the funeral of Queen Elizabeth II. UK markets are closed today, dragging down trade across most of Europe.

However, trading continued, losing 0.4% to $1.1366, to test the 37-year low hit on Friday after dismal August data.

The data pushed market participants in the direction of expecting the BoE to reach just 50 basis points at the rescheduled MPC meeting later this week. Sterling is also under pressure due to uncertainty about the direction fiscal policy will take under the new government of Prime Minister Liz Truss.

5. Oil drops due to demand concerns

Crude oil prices fell more than $100 on concerns about the state of the global economy, with further weakness expected in China despite the lifting of Covid-19 restrictions in the major city of Chengdu at the end of last week.

By 06:30 ET, futures were down 1.9% at $83.10 a barrel, while they were down 1.9% at $87.91 a barrel, testing a seven-month low. There was little support even from a report saying that OPEC and its allies missed their monthly production target by more than 3.5 million barrels last month.

Prices also continued to fall, as traders took a more optimistic view of Europe’s chances of getting through the winter without Russian gas. Recent Russian setbacks on the battlefield, and diplomatic pressure on President Vladimir Putin evident in last week’s exchanges with Xi Jinping and Narendra Modi, have allayed concerns about Moscow’s influence over energy markets.

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