The bottom line
- The S&P closed above 7,800 for the first time, so our hedge is one close from being stopped out. The index rose +0.58% to a record 7,818.93, corroborated two ways: a close report (+44.98 on AP's corrected Monday base of 7,773.95) and the settled SPY route (7,817.29). It traded 7,840 intraday and gave some back. The Dow rose 0.49% to 51,521.28 and the Nasdaq Composite 0.45% to 27,599.79, while the Russell 2000 fell 0.57%. That is narrow leadership: utilities, nuclear power and AI chips (Constellation Energy +12–15% on a reported $4.3bn, 20-year power deal with Google; Marvell +7.1%). This is day one of two for V028. The view is wrong if the S&P closes above 7,800 again tonight, and the 10-year auction and the FOMC minutes land in the last hour of that session.
- The official curve confirmed Monday's provisional mark, and the long end paused on Tuesday. The 5 October par row, read from the Treasury's own page, has 5y 5.06%, 10y 5.31% and 30y 5.66%. That puts 5s30s at 60bp on the view's own rule, three above entry and ten above the stop. Press reports call the 10-year close the highest since 2002. On Tuesday's vendor closes the front end rallied (2y 4.80%, −4bp; 10y 5.28%, −3bp) while the 30-year held at 5.66%, so 5s30s steepened to about 62bp. The $58bn 3-year auction stopped through by 0.2bp, but indirect bidders took only 57.6% against a 65.9% average. October hike odds fell to 20.7% (an intraday snapshot at 14:55 ET) from 55.1% a week ago. The 30-year is still 4bp short of the 5.70% leg that would upgrade V030. The $39bn 10-year auction is at 04:00 AEDT and the FOMC minutes at 05:00.
- Australian consumer confidence fell to a level last seen in the early-1990s recession among people surveyed after the hike, and Westpac still forecasts another hike in November. The Westpac–Melbourne Institute index fell 4.7% to 80.4. Respondents surveyed after the 29 September decision averaged 67.2, and more than 80% expect mortgage rates to rise over the next year. November pricing barely moved, at 17.1% on a tracker stamped 6 October. The ASX ignored the survey: it rose +0.54% to 8,733.30, a third straight gain led by REITs and miners. The 10-year is back to 5.35–5.41% depending on the vendor, so its premium over the US is again positive, at roughly +7 to +13bp. Big-four mortgage rate rises take effect on Friday. V006 is still in favour (+3.03%), with 8,900 the closing level.
- French spreads compressed hard on Marine Le Pen's alternative budget, and the euro recovered from its 17-month low. Le Pen's party proposed cutting the deficit below 5% of GDP in 2027 with €140bn of savings, and said it would judge the government's budget "on its merits". OATs rallied about 11bp to 4.76%, and the 10-year spread over Bunds was quoted at about 127bp, down from "over 150bp" (news report; Trading Economics legs agree). EUR/USD rose 0.45% to 1.1262 and the DXY fell 0.28% to 101.86. V025's own series has now posted 146.9bp for 2 October, its first mark since 1 October and 53bp in the money. The 6 October compression is on a different benchmark and is not spliced in, but it is a warning. Conviction stays at Med. German factory orders fell 10.6% against a 1% consensus decline, after big-ticket orders collapsed.
- Saudi Arabia says its export pipeline is running at 5.8m b/d, which answers one of Monday's strike claims but not the other two. Energy Minister Prince Abdulaziz said in Manama that the East–West line is "back up to 5.8 million barrels" a day, against a 7m b/d maximum. That rebuts the AFP-sourced report that it had stopped again, though he did not address the strike on the Khurais pumping station. Ras Tanura and Rabigh remain unconfirmed by any Saudi or Aramco statement. The aviation authority did confirm attacks on two airports, with three minor injuries. Brent December traded down to about $97 and recovered to about $100.68 (+0.36%) after the settle (vendor print; the exchange settle itself was not found). Gold rose 0.88% to $4,177.80 as the dollar fell. V024 is unchanged and its re-own band is far away.
- Asia's week turns on two events: an Indian rate decision at 15:30 and China's reopening on Thursday. The RBI is expected to raise its repo rate 25bp to 5.50%, its first hike since February 2023. A Reuters poll had 35 of 61 economists expecting that, so a hold is a live minority outcome. Ueda said on Tuesday the BoJ will "keep raising rates" but gave no October signal, and pricing for a 30 October hike stayed at about 25%. The Nikkei rose 1.05% to 70,683.98 and the KOSPI fell 0.89% on chip selling. In credit, FRED's 5 October observation has IG 84bp (−1) and HY 312bp (+2); the CCC series did not load, so V017 holds at Med without a fresh ratio.
Overnight recap
United States: a record on a pause in yields, with weak breadth
The S&P 500 closed 7,818.93 (+44.98, +0.58%), the Dow 51,521.28 (+253.38, +0.49%), the Nasdaq Composite 27,599.79 (+122.48, +0.45%) and the Russell 2000 2,830.97 (−16.17, −0.57%). Those are from TheStreet's 16:17 ET close report, and each reconciles with the AP tabulation's Monday closes. The S&P is corroborated by the settled SPY close (+0.56%, giving 7,817.29), and the Dow by DIA and Trading Economics. The Nasdaq-100 made another record, at about 31,216–31,248; the two routes differ by about 30 points and neither is adopted. The AP tabulation had not posted at filing. The S&P traded as high as 7,840.02 at 11:02 ET and faded into the close, and the VIX was about 15.09 at midday (close not obtained).
Treasuries rallied at the front end. On vendor closes the 2-year fell about 2–4bp to 4.80%, the 5-year to 5.04%, the 10-year to 5.28% and the 30-year 1bp to 5.66%, after Monday's official 10-year close of 5.31%. The $58bn 3-year auction stopped at 4.932%, 0.2bp through when-issued, with a 2.62 bid-to-cover; indirect bidders took only 57.6% against a 65.9% average and directs 31.7%. investingLive graded it C+. The trade deficit widened to $105.6bn in August, against a −$102.0bn consensus, on imports of crude, non-monetary gold and AI-related semiconductors. That is a likely drag on Q3 net exports (our inference); GDPNow is unchanged at 3.7%.
Leadership was narrow. Utilities and real estate led, and communication services was the only sector lower. Gainers: Option Care Health +32.9% on a buyout report; Constellation Energy +12–15% on a reported $4.3bn, 20-year nuclear power deal with Google (the sources disagree on the size of the move); Marvell +7.1% on raised AI guidance; AMD about +2% after Lisa Su said demand "continues to outrun supply". Decliners: Seagate −8.0%, Western Digital −6.9% and Moderna −6.1%. Paramount Skydance's merger with Warner Bros. Discovery reportedly closed after the Supreme Court declined to halt it (single source).
Fed speakers. Daly said further tightening "may be unnecessary" if the tariff, oil and AI shocks prove temporary, but that AI supply pressures "could last beyond the one-to-three-year period". Schmid said the Fed has "a way to go" on inflation and that "credibility [is] at stake", without committing to October. Bowman did not comment on policy. A Williams headline ("price stability is foundational") could not be dated to Tuesday. Logan spoke at 19:00 ET, after filing; on 1 October she had said at least another 50bp of hikes may be needed. Outside the Fed, Bessent said core inflation is "around 2.3%", and Trump signed an order allowing tax-free red-dyed diesel to be sold for general use.
Europe: a French relief rally
European equities rose for a third session. The Stoxx 600 closed 636.76 (+0.50%), the DAX about 25,449 (+0.8%, a two-week high), the CAC 7,865 (+0.40%) and the FTSE 100 10,517.00 (+0.18%, chain-tied exactly). Healthcare led (Genmab +8.3%, AstraZeneca +2.6–2.9%), then banks (BNP +2.5%). Rheinmetall was the weakest stock in the DAX. The bond move was the news. Marine Le Pen's RN put forward an alternative budget, with the 2027 deficit under 5% of GDP and under 3% by 2032 on €140bn of savings, and said it would discuss the government's PLF "on its merits". OATs rallied about 11bp to 4.76%, BTPs 9bp to 4.54% and Spain about 7bp to 4.08%, while Bunds rallied only 1bp to 3.49%. The 10-year spread was quoted at about 127bp, "from over 150bp in recent sessions".
Data were weak. German factory orders fell 10.6% in August, against a consensus fall of about 1%, as big-ticket orders dropped 61.5% after July's surge; excluding large orders they fell only 0.1%. Euro-area retail sales rose 0.1% m/m against 0.2%, and French industrial production fell 0.3%. The BoE's Mann said "inflation has become embedded" and warned it could reach 4% around year-end; pricing has about 84% on a 5 November hike. The ECB's Rehn said higher long-term rates are curbing energy pass-through. Spain's caretaker cabinet re-approved by decree the housing measures whose defeat triggered the 29 November election.
Asia: chips and Ueda
The Nikkei rose 1.05% to 70,683.98, read from the exchange's own page, on Advantest (+3.9%), Taiyo Yuden and Fujikura. The Nikkei VI jumped 27.7% to 29.20. Governor Ueda said the BoJ will "keep raising rates in response to [the] economy and inflation", that financial conditions are "accommodative", and that underlying inflation must be anchored around 2%. He gave no October signal, and Bloomberg's headline read "Ueda does little to challenge bets against October BoJ hike". Pricing for 30 October stayed about 25%. The Hang Seng rose about 1.0% (level unresolved between 24,233 and 24,280) on biotech and AI listings in thin Golden Week trade. The KOSPI fell 0.89% to 6,941.39 on its return from holiday, with SK Hynix −3.5%. The TAIEX added 0.22% to a record 49,822.55 (derived; single source), and India rallied into the RBI: Sensex +0.78%, Nifty +0.98%.
The Gulf, Ukraine and Brazil
Saudi Arabia. The energy minister said the East–West pipeline is pumping 5.8m b/d. Bloomberg and Reuters sources had already said crude was moving, against an AFP source's "big damage and the pipeline stopped again". Satellite imagery shows smoke near Khurais on 4–5 October but does not establish damage. No Saudi or Aramco statement on Ras Tanura or Rabigh has appeared; a Newsquawk headline on a "massive explosion" at a Jeddah refinery is unconfirmed. Saudi-backed Yemeni forces retook the port of Mocha from the Houthis, and the coalition intercepted a missile aimed at Khamis Mushait. Late in the US session, unconfirmed headlines (Fars, Naya, IRNA) reported a tanker turned back after a US escort, missiles towards Hormuz and an explosion off Qeshm. Ukraine: Russia said it downed nearly 900 drones overnight, about 650 of them heading for Moscow, and Kyiv claims it has disabled 51% of Russian refining capacity. EU envoys are expected to approve a new Russia sanctions package today (headline only).
This morning's setup
The Dec SPI was about 8,746.5 (+24.5) on an untimestamped quote. AUD/USD was 0.6968 at 07:54 AEDT. Bitcoin is about $85,560, flat on the day, with spot ETFs losing $89.8m on Monday. Today: the RBI at 15:30 AEDT, German industrial production at 17:00, the EIA report at 01:30 Thursday, the 10-year auction at 04:00 and the FOMC minutes at 05:00.
Market dashboard
Tuesday 6 October: cross-asset change on the session
| Equities | Close | 1d | Note |
|---|---|---|---|
| S&P 500 | 7,818.93 | +0.58% | ⭐ Record and the first close above 7,800. Corroborated: a close report (+44.98 on AP's Monday base of 7,773.95) and settled SPY (+0.5575%, giving 7,817.29). Intraday high 7,840.02. AP tabulation not posted at filing |
| Nasdaq Composite · Nasdaq-100 | 27,599.79 · ≈31,216–31,248 | +0.45% · +0.45–0.50% | Composite from one close report; it reconciles with AP's Monday record of 27,477.31. NDX record on both routes (QQQ-derived and vendor), about 30 points apart |
| Dow Jones | 51,521.28 | +0.49% | Corroborated by settled DIA (51,509) and a vendor (51,524) |
| Russell 2000 · VIX | 2,830.97 · ≈15.09 | −0.57% · ≈−2.8% (midday) | Russell corroborated by IWM (−0.73%). Small caps fell while the index rose. VIX close not obtained; Monday close 15.52, VIX/VIX3M 0.862 |
| Stoxx 600 | 636.76 | +0.50% | Third straight gain. The vendor's narrative says +0.7%; the header level is used |
| DAX · CAC 40 | ≈25,449 · ≈7,865 | +0.8% · +0.40% | DAX header and narrative disagree (25,390 vs 25,449); CAC reconciles with Monday's 7,834.30 |
| FTSE 100 | 10,517.00 | +0.18% | Chain-ties exactly to 10,497.94 |
| FTSE MIB · IBEX · SMI | 51,257.40 · ≈19,432 · 13,858 | — · +0.68% · — | ⚠ The MIB and SMI changes imply priors 119 and 35 points away from Monday's carried closes. Levels published, changes withheld |
| Nikkei 225 · TOPIX | 70,683.98 · — | +1.05% · — | Exchange page; +737.12 ties exactly. Nikkei VI 29.20 (+27.7%). TOPIX not obtained. Record is 73,007 (June) |
| Hang Seng · HS Tech | ≈24,233–24,280 · 4,223 | ≈+1.0% · +0.94% | Two vendors agree on about +240 points but not on the level. Golden Week volume HK$98.3bn |
| KOSPI · TAIEX | 6,941.39 · 49,822.55 | −0.89% · +0.22% | Korea back from holiday; foreign and institutional investors net sold about ₩1.75tn. TAIEX record close (derived; single source) |
| Sensex · Nifty 50 | 72,943.91 · 22,776.10 | +0.78% · +0.98% | Both reconcile with the prior closes; single source. RBI today |
| S&P/ASX 200 · SPI Dec | 8,733.30 · ≈8,746.5 | +0.54% · +0.28% | +46.90 ties to 8,686.40; the ABC's "+0.6% to 8,736" is a snapshot. Third straight gain. SPI has no timestamp (unverified) |
| STI · NZX 50 | 5,667.05 · — | +0.05% · — | STI single source. NZX Tuesday close not obtained |
| Rates & credit | Level | 1d | Note |
|---|---|---|---|
| UST par, 5 Oct (2y · 5y · 10y · 30y) | 4.84 · 5.06 · 5.31 · 5.66% | +1 · 0 · +3 · +3bp | ⭐ Verified against the Treasury's own page. 5s30s 60bp, 2s10s 47bp: Monday's provisional vendor mark (60bp) is confirmed |
| UST vendor close, 6 Oct (2y · 5y · 10y · 30y) | 4.80 · 5.04 · 5.28 · 5.66% | −4 · −2 · −3 · 0bp | Vendor closes compared with par, so the changes carry ±1–2bp of basis. The vendor's own narrative says 10y 5.26%. 5s30s ≈62bp, 2s10s ≈48bp. Official row posts ~09:00 AEDT |
| Gilt 10y · 30y | 5.40% · 5.93% | −3 · 0bp | Single source |
| Bund · OAT · BTP · Spain 10y | 3.49 · 4.76 · 4.54 · 4.08% | −1 · −11 · −9 · −7bp | OAT rally on the RN budget; Newsquawk reports OATs up as much as 163 ticks |
| OAT–Bund | 146.9bp (2 Oct, dedicated series) · ≈127bp (6 Oct, news) | — | ⭐ The dedicated series posted 2 October (prior 130.3bp on 1 October). ⚠ Its Bund input (3.43%) does not match other vendors. The 6 October 127bp is a different benchmark (TE legs 4.76 − 3.49), so the two are not spliced |
| JGB 2y · 10y · 30y | 1.93 · 3.11 · 4.24% | — · +1 · 0bp | Single source; the 30-year is 1bp below the vendor's 4.25% all-time high this month. 30-year auction Thu 14:35 AEDT |
| ACGB 10y · 2y · 3y | 5.35–5.41% · 4.90 · 4.89 | +5 to +11 · −2 · +3bp | ⚠ Conflict: one vendor has 5.35%, three others 5.40–5.41%. The short-end benchmarks also differ. AU–US 10y about +7 to +13bp, positive again after Monday's −2bp |
| Canada 10y · Swiss 10y | 3.93% · 0.52% | −3 · −1bp | Single source |
| US IG · HY OAS (5 Oct) | 84 · 312bp | −1 · +2bp | ⭐ Verified on FRED's text series; 6 October not yet posted. HY–IG 228bp |
| US CCC OAS | 1,202bp (2 Oct, carried) | — | ⚠ FRED rate-limited the CCC series (HTTP 429), so there is no 5 October CCC and no same-day ratio. The mixed-date ratio of about 14.3× is not used |
| FX | Level | 1d | Basis | Note |
|---|---|---|---|---|
| DXY | 101.86 | −0.28% | near-close vendor | Day range 101.75–102.28. The vendor attributes the fall to "an easing in concerns over high energy prices" |
| EUR/USD | 1.1262 | +0.45% | near-close vendor | Up from Monday's 1.1161 low on the OAT rally |
| USD/JPY · GBP/USD | 158.14 · 1.3216 | +0.15% · −0.06% | near-close vendor | ⚠ A second vendor has USD/JPY at 157.87 (range 157.82–158.00): unresolved. The vendor links yen weakness to Takaichi's pledge to cut the consumption tax on food |
| AUD/USD · NZD/USD | 0.6970 · 0.5599 | +0.14% · +0.18% | RBA 4pm · vendor | ⭐ AUD corroborated: the RBA fix and two vendors agree at 0.6968–0.6970 |
| AUD/NZD | 1.2451 | +0.77% vs 2 Oct | RBA 4pm table | ⭐ Verified, and the first RBA-table mark since Friday (2 Oct 1.2356; no fix on the 5 Oct NSW holiday). V023 is now 201 pips above its exit |
| USD/CAD · USD/CHF | 1.4218 · 0.8305 | −0.34% · +0.02% | vendor | Single source |
| USD/BRL · USD/MXN · USD/INR | 4.970 · 17.96 · 96.54 | −0.36% · −0.61% · +0.05% | vendor | INR near its record low; the RBI is intervening and decides at 15:30 |
| USD/CNY · USD/KRW | 6.7016 · 1,343.26 (5 Oct) | — · — | onshore · stale | No CNY fix until Thursday. KRW not obtained for 6 Oct |
| Commodities & digital assets | Last | 1d | Note |
|---|---|---|---|
| Brent DECEMBER (LCOZ6) | ≈$100.68 | +$0.36 / +0.36% | ⚠ Not a settle. A vendor's dated row read about 35 minutes after the settlement window (low $97.09). A second vendor has $100.77, and the same page later read $100.98 in post-settle trade. Its prior row ($100.32) ties to Monday's Reuters settle. A CBS line saying "below $100, down ~2.5%" contradicts both feeds and is not used |
| WTI NOVEMBER | ≈$89.24–89.57 | ≈flat | ⚠ Three vendors conflict; intraday low $86.88. Brent–WTI about $11.4 (derived) |
| Henry Hub · TTF | $3.07 · €76.31 | +0.1% · +3.8% | TTF at a two-week high on Hormuz LNG risk; Qatar's force majeure on Italy is extended through December (single source) |
| Gold (spot) | $4,177.80 | +0.88% | Kitco bid at 15:02 ET; range $4,105.50–4,180.50. Move derived against our $4,141.50 mark |
| Silver · Platinum | $61.59 · $1,697 | +1.08% · −0.88% | Kitco. Gold/silver ratio 67.8 |
| Copper LME cash / 3M · COMEX | $14,355 / $14,320 (2 Oct) · $6.60/lb | — · +0.2% | LME settlements have not posted past 2 Oct. Chile's August output was the lowest since February 2011 (single source) |
| Aluminium LME cash | $3,107.00 (5 Oct) | −$2.50 | Stocks 240,375t. Alcoa's ASX listing rose 4.3% on Tuesday |
| Iron ore 62% | ≈$91.45/t (5 Oct) | — | ⚠ Not updated for 6 Oct, and the vendor's own text is inconsistent. Dalian reopens Thursday |
| Bitcoin | ≈$85,560 | ≈flat (24h +0.2% to +0.5%) | Two vendors at about 19:06 UTC. CoinDesk says traders are watching for a break below $84k |
| ETH · SOL · XRP · BNB | $2,692 · $121 · $1.51 · $781 | 24h | Total market cap $3.011tn, BTC dominance 57.1% |
| Spot ETF flows (5 Oct) | BTC −$89.8m · ETH −$50.8m | verified | IBIT +$69.9m against FBTC −$74.5m. ETH has had five straight outflow days. The 6 Oct rows are placeholders, not zeros |
| Crypto derivatives | OI BTC $27.8bn · ETH $18.3bn | funding +0.004% / +0.005% | Per asset, no timestamp. 24h liquidations BTC $39.4m. Calm |
Conventions: 1d is against Monday 5 October's close. US equity priors are corrected to the AP tabulation (S&P 7,773.95, Russell 2,847.14; see §13). Tuesday Treasury levels are vendor closes; the 5 October row is official par. FX is a near-close vendor print unless marked RBA 4pm. "≈" marks a derived or approximate value, a greyed level is unresolved, and "—" means not obtained or withheld; §13 says which.
What is driving markets
1. The long end is priced off supply and term premium, and the official curve confirms it
Monday's mark is now on the primary source. The Treasury's par row for 5 October has the 10-year at 5.31% and 30-year at 5.66%, with the 5-year at 5.06%. That gives a 5s30s of 60bp, exactly the vendor-based figure published provisionally in No. 022. Press reports call it the highest 10-year close since 2002. On Tuesday the front end rallied and the long end did not: the 2-year fell about 4bp and the 30-year was unchanged (vendor), so the curve steepened again, to about 62bp, on a day the policy path softened. October hike odds fell to 20.7% from 24.1% the session before and 55.1% a week earlier. The 3-year auction was a mixed test of demand. It stopped through by 0.2bp, but indirect bidders took 57.6% against a 65.9% six-auction average, leaving dealers and directs to absorb the rest. Abroad, the JGB 30-year held 4.24%, 1bp below the vendor's all-time high, and gilts eased 3bp. The bull steepener and a softer policy path, alongside a long end that will not rally, is what this theme predicts.
2. Equities ran through the call wall, and the hedge is one close from being stopped
The S&P did what No. 022 said it could do by Thursday. It closed 7,818.93, a record and its first close above 7,800, after an intraday 7,840. The rally ran through the 7,800 call wall on the 5 October map of one free gamma source, which had the flip at 7,661 and dealers long $46bn of gamma. This desk does not rely on the gamma sign, but the level was crossed. Breadth did not confirm it: the Russell 2000 fell 0.57%; on 5 October new 52-week lows outnumbered highs by about 3.6 to 1 (6.45% vs 1.79% of about 4,750 stocks), and only 45.7% of S&P members were above their 200-day on 2 October. Leadership was utilities, nuclear and AI chips (Constellation on a reported Google power deal, Marvell on AI guidance). Hartnett's description of the tape, "long artificial intelligence (NDX), short artificial irrelevance (SPW)", fits the day. Positioning has room: CTAs are estimated at −0.80 SD (Citadel, 1 October vintage, single secondary source), and buybacks reopen on 15 October.
3. Australia: the hike landed on confidence, not on prices
The first survey after the 29 September hike was severe. The Westpac–Melbourne Institute index fell 4.7% to 80.4, and respondents surveyed after the decision averaged 67.2, a level last seen in the early-1990s recession. Westpac calls it the largest daily deterioration it has tracked since 2019. More than 80% expect mortgage rates to rise over the next year, petrol averages above A$2.30 a litre, and the big-four pass-through takes effect on Friday 9 October, after which no big-four variable rate will be below 6%. Westpac's response is to forecast another hike in November. Its reasoning, as reported, is that inflation rather than sentiment sets the path. ANZ has the same call (single secondary source). The market did not follow: November pricing is 17.1% on a tracker stamped 6 October, and December 36.2%. Bonds sold off, with the 10-year 5–11bp higher depending on the vendor, and the ASX rose 0.54%. No RBA official speaks before the 13 October minutes.
4. Europe: the spread finally had a good day
For two weeks the French problem moved from the spread to the CAC and then, on Monday, to the euro. On Tuesday it reversed. Marine Le Pen's RN put forward an alternative budget (a 2027 deficit under 5% of GDP, under 3% by 2032, €140bn of savings) and said it would judge the government's PLF "on its merits". The market read that as lowering the risk of an early censure motion; that is an inference, since RN did not commit its votes. OATs rallied about 11bp, the spread was quoted at about 127bp from "over 150bp", and EUR/USD rose 0.45% to 1.1262. Underneath, nothing has changed. The PLF assumes 1% growth, which the fiscal council calls "optimistic", the government is a minority, unions have called strikes, and passage could run into the first half of 2027. Spain votes on 29 November. The ECB's speakers (Rehn: higher long rates "curb energy pass-through") still did not mention spreads, and ECB pricing has 93% on a hold for October and about 83% on a hike by December, on a tracker dated 5 October.
5. Oil: the pipeline answer came from the minister, not from Aramco
Monday's claims have a partial answer. Prince Abdulaziz said the East–West pipeline is "back up to 5.8 million barrels" a day, against a 7m b/d maximum. He did not mention Khurais, Ras Tanura or Rabigh, and Aramco has said nothing. The coalition called the Houthi claim on Riyadh "misleading", and the aviation authority confirmed attacks on two airports with three minor injuries. Brent dipped to about $97 and closed about flat. Measured flows are now more disputed than No. 022 said. That edition carried Kpler at 19.5–22.5 mb/d through Hormuz on 27–29 September, "above pre-war". Today's sources give 10.3 mb/d, about 76% of pre-war (Newsquawk), independent estimates of 3.7–8 mb/d against a CENTCOM claim of about 16.4 mb/d (Global Energy Flow), and Middle East crude shipments at 98% of pre-war with products at 58% (Trading Economics). These measures differ in what they count. The supply response is still large: the G7's 100m-barrel release, and the EIA STEO raising its Q4 Brent forecast to $105.
Central bank watch
Fed funds pricing: implied probabilities by meeting, now and a week ago
| Bank | Policy rate | Last move / vote | Next decision (AEDT) | Market pricing | Bias |
|---|---|---|---|---|---|
| Fed | 3.75–4.00% | +25bp 16 Sep, 12–0 | Thu 29 Oct 05:00 · minutes Thu 8 Oct 05:00 · blackout from Sat 17 Oct | October hike 20.7% (14:55 ET snapshot), down from 24.1% the previous day and 55.1% a week ago. December: 68.5% one hike, 16.8% two, so about 85% for at least one. A DeFi Rate average of Kalshi and Polymarket had 18% on 3 Oct | Hawkish, pushed to Dec |
| RBA | 4.60% | +25bp 29 Sep, unanimous | Tue 3 Nov 14:30 + SMP · minutes Tue 13 Oct 11:30 | 17.1% hike / 82.9% hold (tracker, 6 Oct); Dec 36.2%; Feb 75.6%; about 19bp over three meetings. Westpac and ANZ forecast a November hike | Tightening bias |
| ECB | DFR 2.50% | +25bp 10 Sep | Fri 30 Oct 00:15 (tracker shows 29 Oct; unresolved) · accounts Thu 8 Oct 22:30 | 93% hold for October; December hike 82.6%; about 71bp over nine meetings (tracker dated 5 Oct, single source) | December over October |
| BoE | 3.75% | Held 17 Sep, 6–3 | Thu 5 Nov 23:00 + MPR | 84% hike; 102bp over nine meetings (single source). Mann: "inflation has become embedded"; she has voted for 4% since July | Hawkish |
| BoJ | 1.25% | +25bp 18 Sep, 7–2 | Fri 30 Oct + Outlook Report (meeting 29–30) | About 25% for October on overnight futures (two secondary sources). Ueda: "keep raising rates", no October signal | Gradual; Dec favoured |
| RBNZ | 2.75% | +25bp Sep | Wed 28 Oct 12:00 | About 58% for a 25bp hike (vendor); about 56bp priced on a bank-bill tracker. QSBO confidence +40% from +14% | Removing stimulus |
| RBI | 5.25% | Held four reviews | TODAY 15:30 (10:00 IST) · presser 17:30 | +25bp to 5.50% is consensus, but thin: 35 of 61 in a Reuters poll (30 Sep). Swaps price about 75bp over 12 months. BofA sees 6.25% by 1H27 | Hiking |
| PBoC | LPR 3.00 / 3.50% | Unchanged 16 months | First fix since 30 Sep on Thu 8 Oct · LPR Tue 20 Oct 12:15 | Shut until Thursday | On hold |
| NBP · BCRP · NBR | 3.75% · 4.25% · 6.50% | — | Poland and Peru today · Romania Thu 8 Oct | Holds expected; no outcomes yet | Holds expected |
| BoC · SNB | 2.25% · 0.00% | — | BoC Thu 29 Oct 00:45 · SNB Thu 10 Dec 19:30 | Not refreshed. Canada 10-year 3.93% | On hold |
| Riksbank · Norges | 1.75% · 4.50% | Norges +25bp 24 Sep | Wed 4 Nov 19:30 · Thu 5 Nov 20:00 | Not refreshed | Neutral · hawkish |
| BoK · BI · CBRT | 3.00% · 5.75% · 37.00% | — | BoK Thu 22 Oct · BI 21 Oct · CBRT 22 Oct | Not refreshed | Hold · hold · easing bias |
| Banxico · BCB | 6.50% · 13.75% | Brazil cut 16 Sep | Banxico Fri 6 Nov 06:00 · Brazil date unverified | BRL 4.97, near a 17-month high; runoff 25 Oct | Easing |
Fed: the minutes arrive with October priced out. One week ago futures had 55% on an October hike; on Tuesday afternoon they had 20.7%, after +29,000 payrolls and a run of officials saying there is no urgency (Williams on 29–30 September, Bowman on 1–2 October, Daly on Tuesday). Logan is the counterweight: on 1 October she said at least another 50bp may be needed, and she spoke after this edition filed. The September dot plot shows one more hike in 2026. For 2027, eight officials see two or more hikes, six see one and four see cuts. The minutes (05:00 Thu AEDT) will show how many participants wanted guidance toward October. The September CPI is Wed 14 Oct, 23:30 AEDT.
RBI: a split consensus. The rupee is near its record low, the RBI is selling dollars, CPI is 4.82% and WPI 9.92%. Most forecasters expect 25bp; SBI Research argues for back-to-back moves in October and December, while S&P sees one hike in the fiscal year. A hold would be the dovish surprise and would test the rupee's floor.
BoJ: Ueda kept his options open. "Pace and timing of future policy adjustment will be decided based on the likelihood of our baseline projections materialising." He named geopolitics, AI-driven demand and the weak yen as inflation risks. Reuters sources say officials want to assess the September hike first, and that the 29–30 October meeting may judge underlying inflation to have roughly reached 2%. Thursday's 30-year auction (14:35 AEDT) is the week's long-end test in Asia.
Regional briefs
United States
A record on narrow leadership, and a softer front end into the minutes. The S&P made a record at 7,818.93 while the Russell 2000 fell 0.57%; the drivers were utilities, nuclear power and AI chips rather than broad cyclicals. The August trade deficit widened to $105.6bn (consensus −$102.0bn; prior revised to −$92.8bn), with imports up 4.3% on crude, non-monetary gold and semiconductors, a likely Q3 net-export drag. The other data were firm: the logistics managers' index 70.2, Redbook +8.6% y/y and RCM/TIPP optimism 46.8; GDPNow is 3.7%. The 3-year auction stopped through, with weak indirect bidding. Fiscal: a continuing resolution funds the government to 11 December, as this note has carried; one positioning source says 4 December, and that discrepancy is unresolved. The CBO's long-run debt path assumes a 10-year below 4.5%, against 5.31% on Monday. Politics: prediction markets on 4 October priced Democrats at 93% to win the House and 65% the Senate on 3 November (aggregator). Q3 earnings start with JPMorgan on Tue 13 Oct (22:00 AEDT); FactSet's Q3 EPS growth estimate is +29.5%.
Euro area
A relief day for France, a bad print for Germany. OATs rallied about 11bp to 4.76% and the 10-year spread was quoted at about 127bp after RN's alternative budget. The CAC rose 0.40% from its six-month low, and the Stoxx 600 0.50% to 636.76. German factory orders fell 10.6% m/m in August against a 1% consensus decline, because big-ticket orders (aircraft, ships, military vehicles) dropped 61.5% after July's surge of more than 200%. Excluding large orders they fell 0.1%, so this is noise in the level, not a collapse. Euro-area retail sales rose 0.1% m/m (consensus 0.2%), French industrial production fell 0.3%, the French state deficit reached €159.6bn for January–August, and construction PMIs were 43.4 (EA) and 46.1 (UK). Spain's caretaker government re-approved by decree the housing package whose defeat triggered the election. EU envoys are expected to approve a Russia sanctions package covering about 1,570 entities today (headline only). Ecofin meets Friday.
United Kingdom
Mann says inflation is embedded; gilts eased anyway. The FTSE 100 rose 0.18% to 10,517.00. The 10-year gilt eased to about 5.40% and the 30-year held about 5.93% (single source). Catherine Mann, speaking at a TS Lombard conference, said "inflation has become embedded" and the labour market "isn't weak enough to tame inflation", and warned it could reach 4% around year-end during the wage round. She has voted for 4% since July. Pricing has about 84% on a 5 November hike and roughly four hikes across nine meetings (single tracker). Morgan Stanley went short GBP/USD at 1.3220 with a 1.2850 target. Thursday brings Greene, Pill and Bailey alongside the Credit Conditions Survey; the Budget is 28 October and monthly GDP is 15 October.
Japan
The Nikkei is back above 70,000 and the volatility index jumped. The exchange page gives 70,683.98, +737.12, +1.05%, with the JPX-Nikkei 400 +0.95% and the Nikkei Semiconductor index +0.87%. The Nikkei VI rose 27.7% to 29.20, a large jump for an up day, which suggests demand for protection into the BoJ (our inference). Movers: Advantest +3.9%, Taiyo Yuden +6.2%, Fujikura +5.2%, MUFG +1.6% (single source). The TOPIX close was not obtained. JGBs were steady: 10-year 3.11%, 30-year 4.24%, 1bp below the vendor's 4.25% all-time high. USD/JPY was 158.14 on one vendor and 157.87 on another. The yen has been weighed down by Takaichi's pledge to cut the consumption tax on food, with a bill due mid-October. Ueda's speech is covered in §05. The 30-year auction is Thursday.
China & Hong Kong
Hong Kong rallied in thin trade; the mainland reopens tomorrow with a week to absorb. The Hang Seng rose about 240 points, about 1.0%. The level is unresolved between 24,233 and 24,280 across two vendors, and HS Tech closed 4,223 (+0.94%) on turnover of HK$98.3bn. Biotech and AI listings led: Zai Lab +9.1%, Zhipu +7.6% on reports that Moonshot AI plans a Q1 2027 Hong Kong listing at about US$50bn, and records for GenScript and WuXi Biologics ahead of ESMO. Anta fell 2.5% and New World Development 3.5%. Golden Week data so far come from state sources: foot traffic on 78 monitored streets rose 3.4% y/y and revenue 5.3% over 1–3 October, against a prior-year base of 888m trips and ¥809bn of spending. No official full-holiday tally exists yet. Xi hardened his language on Taiwan in National Day remarks (headline only). Mainland markets reopen at Thu 8 Oct 12:30 AEDT, and Saturday 10 October is a make-up working day. The US–China truce runs to 10 January 2027.
Emerging Asia & LatAm
India rallied into its first hike in three years; Korea sold chips. The Sensex rose 0.78% to 72,943.91 and the Nifty 0.98% to 22,776.10, helped by Kotak Mahindra (+3.5%) and Axis Bank (+1.5%) on quarterly updates and by lower crude, ahead of the RBI at 15:30 AEDT. The KOSPI fell 0.89% to 6,941.39 on its return from holiday, with SK Hynix −3.5%, Samsung −1.5% and Hanwha Aerospace −4.7%. Samsung's Q3 preliminary results, with operating profit expected at a record of about ₩108tn, are due this week. Korea shuts again on Friday for Hangul Day. The TAIEX added 0.22% to a record 49,822.55 (derived; single source), led by financials. Brazil: the real held near its 17-month high at 4.97 ahead of the 25 October runoff (Bolsonaro 47.03% against Lula's 45.16% in the first round, on the vendor's count). Mexico's peso firmed 0.6% to 17.96.
Australia & New Zealand
The RBA: 17% priced, two banks calling a hike
The cash rate is 4.60% after the unanimous 29 September hike. The tracker, stamped 6 October, has November at 17.1% hike / 82.9% hold, December 36.2% and February 75.6%: about 0.8 of a hike over three meetings, roughly where it was before the sentiment survey. Westpac now forecasts a November hike, and ANZ is reported to have the same call (single secondary source). The RBA's diary has no speaker this week; the next words are the September minutes on Tue 13 Oct at 11:30, then the Annual Report on 15 October, Kent on 18 and 19 October and Connolly on the 20th. ING had cut its year-end AUD/USD target to 0.72 on 28 September and expects an RBA hike to stop a retest of the June low near 0.69. NAB argues Australia may "finish tightening first", which is a medium-term AUD negative.
The survey. The Westpac–Melbourne Institute index fell 4.7% to 80.4 in October from 84.4. Respondents surveyed after the 29 September decision averaged 67.2, a level last seen in the early-1990s recession, and Westpac calls it the largest daily deterioration it has tracked since 2019. More than 80% expect mortgage rates to rise over the next year, and petrol averages above A$2.30 a litre. One vendor's page reports the fall as 4.70 points; the correct move is 4.0 points, or 4.7%.
Markets: equities up, bonds down, the premium restored
Equities. The ASX 200 closed 8,733.30, +46.90, +0.54%, a third straight gain (about 1.5% over three sessions). Real estate +1.2%, utilities +0.9%, and industrials, financials and materials +0.7% each; IT was the worst sector at −1.1%. BHP rose 1.5%, Rio 1.4% and Alcoa about 4.3% on aluminium; Codan fell 4.7% after a roughly 30% run the week before, WiseTech 2.9%, NextDC 2.5% and TechnologyOne 1.9%, and defence names lagged. Breadth was not obtained. The Dec SPI was about 8,746.5 (+24.5, untimestamped).
Rates. The ACGB 10-year closed between 5.35% and 5.41% depending on the vendor (three sources at 5.40–5.41%, one at 5.35%), up 5–11bp. With the US 10-year at 5.28% on vendor levels, the Australian premium is back at roughly +7 to +13bp, after Monday's −2bp. Monday's reversal lasted one session. The 2-year and 3-year benchmarks differ by vendor (4.90/4.89% against 5.04/5.04%) and are not used for spreads.
Currency. The RBA 4pm table: AUD/USD 0.6970, AUD/NZD 1.2451, AUD/JPY 110.22, TWI 64.8. All are verified, and they are the first fixes since Friday 2 October (0.6933 and 1.2356). AUD/USD was 0.6968 at 07:54 AEDT. CFTC (29 Sep): leveraged funds net long AUD 60,592 against asset managers net short 73,199.
Housing and the China link
Pass-through lands Friday. All four majors pass on the full 25bp from Friday 9 October. Westpac's lowest variable rate goes from 5.99% to 6.24%, CBA's to 6.34%, and NAB's and ANZ's to 6.29–6.50%, so no big-four variable rate will be below 6%. The first weekend of auctions after the change is 10–11 October. China. Iron ore was last marked at about $91.45/t on a thin, China-closed market. The vendor's own text is inconsistent, and Dalian and Shanghai reopen Thursday with a week of global moves to absorb. Aluminium-linked names benefited on Tuesday. A weaker-than-expected Golden Week spending tally would hit the materials leg of the ASX.
New Zealand
The NZIER Quarterly Survey of Business Opinion for Q3, released Tuesday, showed net business confidence up to +40% from +14% while firms' own trading activity was flat. NZIER's headline: "further lift in business confidence despite soft activity". NZD/USD rose to 0.5599 from Monday's 2025 low. Pricing for a 25bp RBNZ hike on 28 October is about 58% on the vendor's read. The NZX 50's Tuesday close was not obtained, and Monday's carried 13,669.53 differs slightly from the vendor's implied 13,672.61. On the RBA table the cross rose to 1.2451, up 0.77% since 2 October, as the AUD outperformed despite the RBNZ's steeper priced path.
| Australia — key data trail | Latest | Prior / context | Next release (AEDT) |
|---|---|---|---|
| Cash rate | 4.60% | +25bp 29 Sep, unanimous | Tue 3 Nov 14:30 + SMP · minutes Tue 13 Oct 11:30 · 17.1% priced |
| Westpac-MI consumer sentiment (Oct) | 80.4 (−4.7%) | 84.4; post-decision respondents 67.2 | Verified (Westpac IQ) |
| MI inflation gauge (Sep) | +0.3% m/m | Smallest in three months | Released Mon 5 Oct |
| MI consumer inflation expectations (Oct) | — | Prior 4.9% | Thu 8 Oct 11:00 |
| ANZ-Indeed job ads (Sep) | rose (no figure) | Prior +2.5% | Unverified, vendor text only |
| Mortgage pass-through | +25bp, all four majors | Westpac 5.99% → 6.24%; CBA 6.34% | Effective Fri 9 Oct |
| NAB business survey (Sep) | — | Confidence prior −8 | Tue 13 Oct 11:30, with the RBA minutes |
| Labour force (Sep) | — | Prior +39.5k, 4.6% | Thu 15 Oct 11:30 |
| Quarterly CPI (Q3) | — | V006's resolution date | Wed 28 Oct 11:30 |
| ACGB 10y · AU–US 10y | 5.35–5.41% · +7 to +13bp | From 5.30% · −2bp | Derived across closes about 15 hours apart |
House views & tactical framework
No trigger fired, but V028 is on its first day above its closing level. Yesterday's two unmarkable views now have marks on their own series. V025 is at 146.9bp (2 October, dedicated series) and V023 at 1.2451 (RBA table, 6 October). V030 is marked on official par for the first time since entry, at 60bp (5 October). No conviction changed. Tuesday split the book. V030, V023 and V006 moved in favour. V028 moved to the edge of its stop. The 6 October French compression, on a different benchmark, is a warning for V025 that it is not yet marked against.
| Asset | Bias | Conv. | Horizon | Rationale | What changes the view |
|---|---|---|---|---|---|
| Rates | |||||
| US 5s30s (V030) | Steepener | Low | 1–3 mo | 60bp on official par (5 Oct), against a 57bp entry; about 62bp on Tuesday's vendor levels. The 10-year closed at 5.31%, the highest since 2002 (press), and the front end then rallied while the 30-year held. October hike odds 20.7% from 55.1% a week ago: the policy path softened and the long end did not. Indirect demand was weak at the 3-year | PRE-COMMITTED: two consecutive official par closes below 50bp close this view. Upgrade to Med: through 65bp with the 30-year above 5.70%. The 30-year is at 5.66%, 4bp short. ⚠ The 10-year at 04:00 Thu, the minutes at 05:00 and the 30-year at 04:00 Fri: a bull flattener is the risk |
| OAT–Bund (V025) | Widener | Med | 1–3 mo | Marked: 146.9bp on 2 October on the dedicated series, +53bp from a ≈94bp entry. ⚠ That series' Bund input (3.43%) differs from other vendors, and the 16.6bp jump from 1 October is large. On 6 October a different benchmark compressed to about 127bp on RN's alternative budget (OATs −11bp). The structural case is unchanged: a minority government, a 1% growth assumption the fiscal council calls "optimistic", a Spanish election on 29 November, and an ECB that has not mentioned the TPI | UNCHANGED: a compression inside 80bp; a credible French consolidation; a dovish ECB on 30 Oct. ⚠ Not raised to High on a 53bp gain while a same-day compression on another benchmark is unexplained. A second RN signal of budget support would be the first real threat. ECB accounts Thu 22:30; Ecofin Fri |
| Credit | |||||
| US credit (V017) | UW HY/CCC; prefer 3–5y IG | Med | 1–3 mo | 5 October: IG 84bp (−1), HY 312bp (+2), both verified on FRED. The CCC series was rate-limited, so the last CCC is 1,202bp (2 Oct) and no same-day ratio is published. HY widened 2bp on a day the S&P rose 0.7%, which fits the view. Since 25 Sep: IG +3, HY +19bp. Paramount's 10-year IG tranche widened about 15bp from issue; the merger reportedly closed | UNCHANGED: CCC inside 1,050bp with IG unchanged or tighter closes it (152bp from the last CCC mark). ⚠ The 5 Oct CCC observation is tomorrow's first target |
| Equities | |||||
| S&P 500 (V028) | Own downside convexity, not delta | Low | 2–4 wk | Losing: 7,818.93, a record and the first close above 7,800; 0.97% above the 7,743.41 reference. What is left of the rationale is breadth: the Russell 2000 fell 0.57% on the day, new lows outnumbered highs about 3.6 to 1 on 5 Oct, and 45.7% of members were above their 200-day on 2 Oct. The forward P/E is 19.0× | UNCHANGED AND LIVE: two consecutive closes above 7,800 close this view. Day one is done; a close above 7,800 tonight closes it as WRONG. A close below 7,680 confirms it. ⚠ Not re-argued if it fires |
| ASX 200 (V006) | Underweight tactically | Low | 2–4 wk | +3.03% in favour: 8,733.30 against 9,005.9, after a third straight gain. The post-decision sentiment cohort at 67.2, Westpac and ANZ calling a November hike, and pass-through on Friday support both legs: the rate leg and the household-demand leg. The ACGB 10-year is back above Treasuries. Against it: November pricing is still only 17.1% | PRE-COMMITTED, UNCHANGED: two consecutive closes above 8,900 close it (1.9% away). Resolution: CPI Wed 28 Oct. The minutes (13 Oct) and labour force (15 Oct) are next |
| FX | |||||
| AUD/NZD (V023) | Long | Low | 1–2 mo | Marked: 1.2451 on the RBA 4pm table (6 Oct), +1.10% from ≈1.2315 and 95 pips above the 2 October fix. Unchanged premise: NZ prices roughly four times Australia's tightening on a policy rate 185bp lower, and the AUD took the better of Tuesday's data. NZIER business confidence rose to +40%, which supports the RBNZ's priced path | PRE-COMMITTED, UNCHANGED: two consecutive RBA-table closes below 1.2250 close this view (201 pips away). CFTC: leveraged funds net long AUD +60,592 against asset managers −73,199 |
| Commodities | |||||
| Brent (V024) | Residual call spread only — no new risk | Low | 1–3 mo | December about $100.68 (+0.36%) on a post-settle vendor print; the exchange settle was not found. The Saudi minister says the East–West pipeline is at 5.8m b/d; Ras Tanura and Rabigh are unconfirmed. Hormuz flow estimates now span 3.7–22.5m b/d across providers. The products gap (58% of pre-war on one measure) is where the risk sits | PRE-COMMITTED, UNCHANGED: two consecutive December settles in $86.53–89.53. Also a confirmed restart at scale, or a Hormuz reopening Oman confirms. EIA Thu 01:30 AEDT |
Book and scorecard. Seven open and twenty-three closed: 3 right, 13 wrong, 7 scratch, so 3 of 16 decided calls were right. Nothing closed this edition. V028 is the view most likely to close next, and by its own rule it would close wrong.
Portfolio-level read. The centre of the book (V030, V025) is long the term premium and long European fiscal stress. Both are in the money and both face their tests this week: three US auctions, the minutes and a French political process that just produced its first constructive signal. The two independent legs, V023 and V006, both moved in favour on Tuesday on the same Australian story. That is correlation inside what we call diversification. The hedge, V028, has done its job of costing little and is about to be stopped. We will not replace it until the breadth evidence becomes a price signal.
These are analytical framings for a professional reader; they are not personalised investment advice and carry no position sizing. The "what changes the view" column is the accountability mechanism; every view is logged and scored in the project's views ledger.
Positioning, flows & sentiment
⚠ The CFTC data are dated Tuesday 29 September, before the payroll print. The next report is Friday 9 October 15:30 ET (06:30 AEDT Saturday), covering Tuesday 6 October. This morning's re-read reproduces every carried leg exactly.
| Indicator | Latest | Change / context | Read |
|---|---|---|---|
| CFTC — positions as of Tue 29 September (unchanged) | |||
| CBOT Treasuries — leveraged funds, six legs | −6,576,935 | 2y −1.17m · 5y −1.99m · 10y −2.04m | Ultra-10y −328,471 · bond −251,395 · ultra-bond −808,870. Asset managers are the long side (10y AM net about +2.78m). Consistent with substantial basis-trade exposure, which the data cannot prove |
| E-mini S&P 500 | LF −372,489 · AM +904,003 | LF +3,085 on the week | Citadel (via a secondary source): non-dealers liquidated $63.7bn of S&P futures over six weeks, more than 70% of it from closing longs (unverified) |
| FX — leveraged funds | EUR −39,265 · JPY −14,161 · AUD +60,592 · CAD −69,644 | GBP +4,606 · NZD −1,066 | AUD: leveraged long, asset managers short (−73,199). Tuesday's euro rebound came against a consensus short |
| Gold · WTI — legacy non-commercial | +218,632 · +109,463 | −7,221 · −31,643 | Gold is still the most crowded long on the desk; WTI's drop came from new shorts |
| Flows — three universes, labelled, never netted | |||
| BofA / EPFR (week to 30 Sep) | Bonds +$18.8bn · equities +$15.8bn | MMF −$118bn · crypto +$0.9bn · gold +$0.7bn | US equities had a second week of outflows; EM +$3.2bn. Hartnett: risk-off lasts "until the U.S. dollar peaks"; "long artificial intelligence (NDX), short artificial irrelevance (SPW)". Single secondary source (Investing.com, 2 Oct) |
| BofA Bull & Bear | 8.8 (1 Oct, aggregator) | sell signal | Carried from No. 022; not re-confirmed this morning |
| ICI | LT funds +$20.14bn (w/e 23 Sep) · MMF $7.89tn | MMF −$45.45bn (w/e 30 Sep) | Verified. The money-market drawdown is consistent with quarter-end mechanics |
| US spot crypto ETFs (Farside) | BTC −$89.8m · ETH −$50.8m | 5 Oct | Week of 28 Sep–2 Oct BTC +$241.1m. ETH has had five straight outflows. Strategy bought 334 BTC on 1–4 Oct and holds 848,000 (SEC 8-K) |
| Sentiment and volatility | |||
| VIX term structure (5 Oct) | VIX 15.52 · VIX3M 18.00 | ratio 0.862 | Contango, day 125. Tuesday's VIX was about 15.09 at midday |
| CBOE SKEW (5 Oct) | 143.0 | 39th pct (1 yr) | Re-fetched, not carried. Downside protection is not unusually expensive |
| Put/call (2 Oct) | Equity 0.58 · total 0.78 | 9-day avg 0.83, 18th pct | The vendor labels this "complacency" |
| Fear & Greed replica (5 Oct) | 42, Fear | 44 a week ago · 51 a month ago | Stock-price strength 6 and cash-ETF flows 6, against safe-haven demand 89 and junk-bond demand 77 |
| AAII (w/e 30 Sep) | Bulls 34.6 · Bears 46.5 | spread −11.9 | Next survey Thu 8 Oct (US time) |
| BofA FMS (Sep) | Cash 3.9% · net 49% OW equities | net 48% UW bonds | Top tail risk: a disorderly rise in yields (33%). Most crowded trade: long semis (53%). October survey due mid-month |
| Breadth, technicals and dealer positioning | |||
| % of S&P members above 200-day | 45.70% (2 Oct) | long-run avg 65.21% | Hartnett counts about 300 below their 200-day, which is consistent |
| New highs / lows (5 Oct) | 1.79% / 6.45% | McClellan −6.92 | Lows outnumber highs about 3.6 to 1 with the index at a record. Hindenburg inactive (3 of 4 conditions) |
| Dealer gamma (5 Oct close) | Flip 7,661 · call wall 7,800 · put wall 7,700 | net +$46.35bn | Single free source. Tuesday's close went through the call wall; the 6 October map was not refreshed. The gamma sign is still not relied upon |
| Prediction markets | US 10y ≥5.4% before 2027: 52% | ≥5.5% 34% · ≥6.0% 5% | Polymarket event page; its resolution source should be checked against the 5.31% par close |
| Valuation and earnings — FactSet, 2 October | |||
| Forward P/E · Q3 EPS growth | 19.0× · +29.5% | 5-yr avg 19.8× | Verified. Guidance: 72 positive, 44 negative. Bottom-up target 9,280.66. Reporting starts Tue 13 Oct |
The week ahead
| Day | AEDT | ET | Event | Cons. | Prior | Imp. |
|---|---|---|---|---|---|---|
| Wednesday 7 October — RBI, the 10-year, the FOMC minutes · mainland China still shut | ||||||
| Wed | 15:30 | 00:30 | IN RBI decision, 10:00 IST (press conference 17:30 AEDT) | 5.50% | 5.25% | H |
| Wed | day | — | PL NBP decision · PE BCRP decision · EU envoys on the Russia sanctions package · CN FX reserves | 3.75% · 4.25% | 3.75% · 4.25% | L |
| Wed | 17:00 | 02:00 | DE industrial production (Aug) m/m · UK Halifax HPI | +0.5% · +0.2% | −1.1% · −0.2% | M |
| Wed | 17:45 | 02:45 | FR trade balance | −€6.5bn | −€6.7bn | L |
| Wed | 01:30 Thu | 10:30 | US EIA weekly petroleum — the distillate line | crude +0.9m | H | |
| Wed | 04:00 Thu | 13:00 | US 10-year note auction, $39bn | H | ||
| Wed | 05:00 Thu | 14:00 | US FOMC minutes of 15–16 September | H | ||
| Wed | 06:00 Thu | 15:00 | US consumer credit (Aug) | $14.4bn | $18.1bn | L |
| Thursday 8 October — China reopens · ECB accounts | ||||||
| Thu | 10:01 · 10:50 | Wed 19:01 · 19:50 | UK RICS house price balance · JP current account | −30 · ¥2.13tn | −28 · ¥2.52tn | L |
| Thu | 11:00 | Wed 20:00 | AU MI consumer inflation expectations (Oct) | 4.9% | M | |
| Thu | 12:30 | — | Mainland China and Stock Connect reopen; first CNY fix since 30 Sep (Sat 10 Oct is a make-up working day) | H | ||
| Thu | 14:35 | Wed 23:35 | JP 30-year JGB auction, with the 30-year at 4.24% | 4.08% | H | |
| Thu | 17:00 | 02:00 | DE trade balance · RO NBR decision | €18.9bn | €21.3bn | M |
| Thu | 19:30–00:15 Fri | 04:30–09:15 | UK BoE Credit Conditions Survey · Greene · Pill · Bailey · Fed's Waller (time per one calendar) | M | ||
| Thu | 22:30 | 07:30 | EZ ECB accounts of the 9–10 September meeting | H | ||
| Thu | 23:30 | 08:30 | US initial jobless claims | 200k | 197k | M |
| Thu | 04:00 Fri | 13:00 | US 30-year bond auction, $22bn: the direct test of V030 · Musalem 04:40 | H | ||
| Friday 9 October | ||||||
| Fri | open | — | AU big-four mortgage rate rises take effect · Korea shut (Hangul Day) · Ecofin (agenda not posted) | H | ||
| Fri | 10:30 | Thu 19:30 | JP household spending (Aug) y/y | −3.5% | −3.6% | L |
| Fri | 19:00 · 23:30 | 04:00 · 08:30 | IT industrial production · CA labour force (Sep), change and unemployment rate | 0.0% · +6.2k, 6.5% | +0.7% · −41.7k | M |
| Fri | 01:00 Sat | 10:00 | US UMich sentiment (Oct prelim) · CFTC COT 06:30 Sat · Collins 07:00 Sat | 47.6 | 48.1 · 1y infl. 4.6% | M |
| The sessions after | ||||||
| Mon 12 | — | — | US Columbus Day: bond market closed, equities open · Canada and Japan holidays · IMF/World Bank Annual Meetings, Bangkok, 12–18 Oct | M | ||
| Tue 13 | 11:30 · 22:00 | Mon 20:30 · 07:00 | RBA minutes · NAB survey · CN trade (date tentative) · JPMorgan Q3 (other banks unconfirmed) · US NFIB | NAB conf. −8 | H | |
| Wed 14 | 12:30 · 23:30 | Tue 21:30 · 08:30 | CN CPI / PPI · US CPI (September), confirmed on the BLS schedule | CN 0.8% / 3.8% · US 3.4% y/y | H | |
| Thu 15 | 05:00 · 11:30 · 17:00 · 23:30 | Wed 14:00 · Wed 20:30 · 02:00 · 08:30 | US Beige Book · AU labour force · UK GDP (Aug) · US PPI and retail sales · buyback blackout ends 15 Oct · European Council 15–16 | AU +39.5k, 4.6% · US retail +1.2% | H | |
| Fri 16 – Sat 17 | 20:00 Fri | 05:00 | EZ final HICP (Sep) · US industrial production · Fed blackout begins Sat 17 Oct | 3.8% · — | M | |
| Late Oct | — | — | PBoC LPR Tue 20 · BI 21 · BoK, CBRT 22 · Brazil runoff Sun 25 · RBNZ, UK Budget and AU Q3 CPI Wed 28 · FOMC Thu 29 05:00 · BoC Thu 29 00:45 · ECB Fri 30 00:15 · BoJ Fri 30 | H | ||
| Nov–Jan | 14:30 Tue 3 | — | RBA 3 Nov + SMP · US midterms 3 Nov · BoE 5 Nov · Spain election 29 Nov · US funding expiry (11 Dec carried; one source says 4 Dec) · US–China truce 10 Jan | H | ||
⚠ Every H/M/L rating is this desk's own judgement. Consensus figures come from one calendar and may move. The Canada labour-force consensus differs between calendars (+6.2k here; +9.0k carried in No. 022). The time of Waller's Thursday appearance is from one calendar and is unconfirmed. Auction sizes are from secondary sources, and the 3-year size was confirmed by its result.
Risk radar
| # | Risk | Trigger / timing | Probability | Impact if realised | Cheapest expression / hedge |
|---|---|---|---|---|---|
| 1 | Two auctions and the minutes test the long end inside 24 hours | 10y Thu 04:00 · minutes Thu 05:00 · 30y Fri 04:00 AEDT · JGB 30y Thu 14:35 | 33% of FMS respondents name disorderly yields the top tail risk (Sep); Polymarket 52% for a 10y ≥5.4% before 2027 | The official 10-year closed 5.31% on Monday, the highest since 2002 (press); indirect bidding was weak at the 3-year. A tailed 30-year with the 30-year through 5.70% upgrades V030; a strong one flattens | V030. Payer swaptions on the 30-year rather than outright duration |
| 2 | The S&P keeps going on narrow leadership | Tonight's close against 7,800; buybacks reopen 15 Oct; JPMorgan 13 Oct | — | A second close above 7,800 stops V028. Russell −0.57% on a record day; lows outnumber highs 3.6 to 1 | If short delta elsewhere, upside call spreads; if long, Russell puts are the cheaper breadth hedge |
| 3 | Saudi infrastructure: one claim answered, two open | Live. The minister reports 5.8m b/d on the pipeline; Ras Tanura and Rabigh unconfirmed | — | A confirmed Ras Tanura (550k b/d) or Rabigh hit moves product cracks before crude. Hormuz flow estimates span 3.7–22.5m b/d across providers | Product-crack optionality; do not trade the flat price on a Sabereen or Fars headline |
| 4 | The French relief rally extends | A second RN signal of budget support; ECB accounts Thu 22:30; Ecofin Fri | ECB Oct hold 93% (tracker) | OAT–Bund about 127bp on 6 Oct from over 150bp. A durable compression threatens V025 well before its 80bp exit | V025 held at Med; no new EUR shorts (consensus in both CFTC cuts) |
| 5 | Australia's demand shock arrives before the RBA's next word | Pass-through Fri 9 Oct; minutes 13 Oct; labour force 15 Oct; CPI 28 Oct | RBA Nov 17.1%; Westpac and ANZ forecast a hike | Post-decision sentiment 67.2, a level last seen in the early-1990s recession. A hike into it hits the rate-sensitive index; a demand collapse hits earnings | V006; the AU 3-year as the cleaner rate expression |
| 6 | Credit stays wide while equities rise | The 5 Oct CCC print (not obtained); IG supply | — | HY widened 2bp to 312bp on 5 Oct as the S&P rose 0.7%. CCC/IG last 14.14× (2 Oct) | V017; CDX HY protection rather than cash |
| 7 | The RBI holds into a record-low rupee | Today 15:30 AEDT | 35 of 61 expect a hike (Reuters, 30 Sep) | A hold is the dovish surprise; the rupee is near 96.5 with the RBI selling dollars | INR vol over the decision |
| 8 | China absorbs a week of global moves in one session | Thu 8 Oct 12:30 AEDT | — | The Nikkei is back above 70,000, the Hang Seng rose about 1%, and Golden Week data are only partial | A50 and HSI options over the reopening |
| 9 | The minutes revive October | Thu 05:00 AEDT; Logan's Tuesday-night remarks | Oct hike 20.7% (futures, intraday) | Priced odds fell from 55.1% to 20.7% in a week. A minutes record showing broad support for guidance toward October would reprice the front end | 2-year payers; the front end is where the asymmetry sits |
| 10 | Gold stays crowded as the dollar turns | Continuous | — | Spot $4,177.80 (+0.88%) as the DXY fell 0.28%; legacy non-commercial net long 218,632 | Put spreads; no gold view open |
| 11 | US midterms and the funding date | 3 Nov; funding expiry 11 Dec (carried) or 4 Dec (one source) | Dem House 93% · Senate 65% (aggregator, 4 Oct) | FMS respondents flag a Democratic sweep as a rising tail risk | Q4 collars |
| 12 | Brazil's runoff re-prices an EM carry trade | Sun 25 Oct | — | The BRL is at 4.97, near its 17-month high, after the first round | BRL vol over the runoff rather than more spot |
Key levels
| Instrument | Last | Support | Resistance | Comment |
|---|---|---|---|---|
| S&P 500 | 7,818.93 | 7,800 (V028 stop level) · 7,700 (put wall) · 7,680 (V028 confirms) · 7,661 (flip, one source) | 7,840.02 (intraday record, 6 Oct) | First close above 7,800; a second one closes V028 |
| UST 5s30s · 2s10s | 60bp par (5 Oct) · ≈62bp vendor · 47bp | 50 (V030 closes) · 57 (entry) | 65 (V030 upgrades, with 30y > 5.70%) | Official 6 Oct row ~09:00 AEDT |
| UST 30y · 10y · 2y | 5.66% · 5.28% · 4.80% (vendor) | 5.60 · 5.24 · 4.78 (1 Oct par) | 5.70 (V030 upgrade leg) · 5.31 (5 Oct par close) · 5.35 (intraday) · 4.84 | Two auctions and the minutes in 24 hours |
| OAT–Bund | 146.9bp (2 Oct, dedicated) · ≈127bp (6 Oct, other) | 80 (V025 closes) | 146.9 (series high) | Series not spliced |
| Gilt 10y · JGB 30y | 5.40% · 4.24% | 5.30 · 4.10 | 5.44 (intraday) · 4.25 (vendor ATH) | JGB 30-year auction Thu |
| ACGB 10y · AU–US 10y | 5.35–5.41% · +7 to +13bp | 5.30 · 5.25 | 5.45 | The premium is back after one session below zero |
| DXY · EUR/USD · USD/JPY | 101.86 · 1.1262 · 158.14 | 101.75 · 1.1161 (17-mo low) · 156.50 | 102.50 · 1.1300 · 159.00 · 160 | The euro rebounded from Monday's low |
| AUD/USD · AUD/NZD | 0.6970 · 1.2451 (RBA) | 0.6936 · 0.6900 · 1.2250 (V023 closes) | 0.7000 · 1.2500 | The first RBA fixes since Friday |
| Brent (Dec) · WTI (Nov) | ≈$100.68 · ≈$89.24–89.57 | $97.09 (6 Oct low) · $86.53–89.53 (V024 re-own) · WTI $86.83 | $103.50 · WTI $90.44 / $91.60 (hourly MAs) | Settles not confirmed |
| Gold · Silver | $4,177.80 · $61.59 | $4,105 · $60.00 | $4,203.60 · $62.00 | Gold rose as the dollar fell |
| S&P/ASX 200 | 8,733.30 | 8,686 · 8,614 | 8,900 (V006 closes) · 9,005.9 | A third straight gain; SPI about +0.3% |
| Nikkei · KOSPI · Hang Seng | 70,683.98 · 6,941.39 · ≈24,250 | 69,947 · 6,900 · 24,000 | 73,007 (record) · 7,004 · 24,500 | Hang Seng level unresolved |
| IG / HY / CCC OAS | 84 / 312bp (5 Oct) · 1,202 (2 Oct) | CCC 1,050 (V017 closes) | HY 324 (1 Oct) · CCC 1,215 (1 Oct) | CCC 5 Oct not obtained |
| VIX · VIX/VIX3M | ≈15.09 (midday) · 0.862 (5 Oct) | 15.00 | 17.59 (1 Oct high) | Contango, day 125 |
Data notes & sources
How this edition was built
Six research desks ran in parallel from 06:05 AEDT, about five minutes after the US cash close. Asia, Australia and Europe were drafted first, following the Tuesday-to-Friday timing protocol. The US-close block was fetched last and re-checked at 07:25 AEDT. The AP tabulation for 6 October had not posted (a guessed mirror URL returned 404), so the S&P close rests on a close report corroborated by the settled SPY route. The official Treasury par row for 6 October posts about 09:00 AEDT, so Tuesday's Treasury figures are vendor closes; the 5 October par row was read from the Treasury's own page. The Fed Rate Monitor still showed its 14:55 ET intraday stamp at 07:25 AEDT, so it is quoted as an intraday read. Every figure was retrieved on 6–7 October 2026; nothing is recalled.
Corrections and updates to No. 022
(1) MATERIAL: Monday's US closes, from the AP tabulation. S&P 500 7,773.95 (+51.23), not 7,775.30. Russell 2000 2,847.14 (+14.24), not ≈2,857. The Nasdaq Composite closed at a record 27,477.31 (+286.45), which No. 022 left blank; the Dow's 51,267.90 matches what was carried. V028's distance to 7,800 on Monday was therefore 0.33%, not 0.32%.
(2) MATERIAL: V030's provisional mark is confirmed on the primary source. Official par for 5 October: 2y 4.84%, 5y 5.06%, 10y 5.31%, 30y 5.66%. 5s30s 60bp, the figure published provisionally. The vendor 5-year (5.07%) and 30-year (5.67%) were each 1bp high, and the errors cancelled.
(3) MATERIAL: the claim of Hormuz flows "above pre-war" is now disputed. No. 022 carried Kpler's 19.5–22.5 mb/d for 27–29 September in its bottom line and Theme 4. Today's sources give 10.3 mb/d, about 76% of pre-war (Newsquawk); independent estimates of 3.7–8 mb/d against a CENTCOM 16.4 mb/d (Global Energy Flow); and Middle East crude shipments at 98% of pre-war with products at 58% (Trading Economics). The measures count different things. The flat "above pre-war" framing is withdrawn in favour of the range.
(4) The OAT–Bund dedicated series posted 2 October at 146.9bp (prior 130.3bp, 1 October). V025 is marked on it.
(5) Monday's settled Fed read is recovered. The monitor's previous-day column on 6 October shows 24.1% for an October hike, against the 26.4% intraday snapshot No. 022 quoted.
(6) Monday's VIX closed at 15.52, not the 15.55 read at 14:10 ET; VIX3M was 18.00 and the ratio 0.862.
(7) Westpac sentiment's prior (84.4) and Friday's pass-through date are confirmed. One research brief gave the date as "Thu 9 Oct"; 9 October is a Friday.
(8) The Saudi aviation authority confirmed attacks on two airports (three minor injuries), which partly substantiates Monday's Riyadh-airport reports. The strike claims on Ras Tanura and Rabigh remain unconfirmed.
Conflicts and how they were resolved
Brent December: no exchange or Reuters settle was found. A vendor's dated row at about 15:05 ET reads $100.68, a second vendor $100.77, and the first vendor later $100.98 in post-settle trade. A CBS live line ("below $100, down ~2.5%") contradicts all of them and is rejected as stale. Published as ≈$100.68, labelled not a settle. WTI: $89.24, $89.44 and $89.57 from three vendors, so it is published as a range. ACGB 10-year: 5.35% on one vendor against 5.40–5.41% on three, so it is published as a range, and the AU–US spread with it. USD/JPY: 158.14 against 157.87, unresolved. Nasdaq-100: 31,216 (derived from QQQ) against 31,248 (vendor). Both are records; neither is adopted. Hang Seng: 24,233 against 24,280, with the same points change. FTSE MIB and SMI: the vendor's changes imply priors 119 and 35 points away from the carried closes, so levels are published and changes withheld. OAT–Bund: 146.9bp (dedicated series, 2 Oct) against about 127bp (news and vendor legs, 6 Oct). Different benchmarks; not spliced. US funding expiry: 11 December carried against 4 December in one positioning source, unresolved. ECB meeting date: one tracker lists 29 October against 30 October (00:15 AEDT) carried, unresolved. RBI consensus: one low-quality source calls a hold the consensus; it is outvoted by Reuters' 35 of 61 and four bank calls.
Single-source and unverified items
The SPI quote (no timestamp) · TOPIX not obtained · TAIEX, Sensex, Nifty, STI, KOSPI and Japanese movers (one vendor each) · TTF, COMEX copper, Henry Hub · gilt, JGB, Canada and Swiss yields · BoE and ECB pricing (one tracker each) · BoJ October pricing (two secondary analyses) · ANZ's November RBA call · Constellation Energy's Google deal size and the move's magnitude · the Paramount–WBD close · the Williams headline date · Lance Roberts/Citadel/GS positioning statistics · the Flow Show figures (secondary) · dealer-gamma levels · Fear & Greed replica · crypto derivatives (no timestamp) · Newsquawk headlines on Hormuz, Qeshm and Jeddah · the EU sanctions package · the Xi Taiwan remarks (headline only).
Not published
The AP tabulation for 6 October · the official 6 October par row · the settled 6 October Fed Rate Monitor read · the VIX close for 6 October · the ICE Brent and NYMEX WTI settles · the CCC OAS for 5 October (FRED HTTP 429) · OAS for 6 October · LME settlements after 2 October · iron ore for 6 October · TOPIX · NZX 50 for 6 October · ASX breadth · USD/KRW and USD/CNH for 6 October · Logan's 19:00 ET remarks · API inventories · official Golden Week totals · post-payrolls CTA estimates · Lipper · any Hormuz closure probability.
Tomorrow's first verification targets
(1) Tonight's S&P close against 7,800, which decides V028. (2) The official 6 and 7 October par rows for V030, and the 10-year and 30-year auction results. (3) The 5 and 6 October CCC OAS for V017 (try ALFRED if FRED rate-limits). (4) The OAT–Bund dedicated series for 5–6 October, to see whether the 127bp compression shows on V025's own series. (5) The ICE Brent settle for 6 October. (6) The RBI decision. (7) The FOMC minutes and Logan's remarks. (8) Any Saudi or Aramco statement on Ras Tanura and Rabigh. (9) The AP tabulation for 6 October, to confirm the record.
United States, the Fed and positioning
- TheStreet — market close, 6 October · AP via La Nación — Monday's tabulation · Yahoo Finance — markets live
- stockanalysis — SPY · QQQ · DIA · IWM history · TE — US stocks
- US Treasury — daily par yield curve, October 2026 · TE — US yields · investingLive — 3-year auction · trade balance
- Investing.com — Fed Rate Monitor · Daly · Schmid · Bowman · BLS — CPI schedule
- CFTC — TFF · COMEX · NYMEX · BofA Flow Show via Investing.com · ICI · ICI MMF
- AAII · VIX term structure · SKEW · put/call · Fear & Greed replica · highs/lows · breadth · zerogex
- FactSet — Earnings Insight, 2 October · Polymarket — 10-year · DeFi Rate — midterms · Lance Roberts, 6 Oct
Rates, FX and central banks
- RBA — 4pm exchange rates · RBA — coming up · centralbank.watch — RBA · BoE · ECB · RBNZ
- OAT–Bund dedicated series · Newsquawk — European wrap, 6 October · TE — OAT · Bund · JGB · ACGB
- TE — DXY · EUR · AUD · Investing.com — AUD/USD · USD/JPY
- Reuters via WBOW — Ueda · ForexFactory — Ueda headlines · FXStreet — BoJ pricing · Reuters via 93.3 — Mann · RBI poll · EU Insider — French budget
Australia, New Zealand and Asia
- Westpac IQ — consumer sentiment, October · ABC — markets live, 6 October · Market Index · TE — ASX · SPI futures
- Australian Broker — pass-through · investingLive — Asia-Pacific · NZIER — QSBO · TE — NZX
- Nikkei Indexes · TE — Japan · BigGo — Hang Seng · TE — Hang Seng · Global Times — Golden Week
- TE — KOSPI · TAIEX · Sensex/Nifty · STI
Europe and geopolitics
- TE — European equities · FTSE · German factory orders · investingLive — European wrap · ForexFactory — this week · next week
- Al Jazeera — East–West pipeline 5.8m b/d · Türkiye Today / AFP · Arab Times / Bloomberg · OilPrice — Rabigh · CBS live · Al Jazeera live
- AP — Russian drone claims · AP — Spain housing decree · Supply Chain Dive — US–China truce · Global Energy Flow — Hormuz