Market Review
Key News
China Market
1. Continuous Rebound in the Heat of China's Economy
Data from the National Bureau of Statistics shows that China's GDP grew by 4.9% year-on-year in the third quarter. Retail sales of consumer goods have rebounded for two consecutive months in September. September saw industrial output by major factories increase 4.5% year-on-year. From January to September, the country's fixed asset investment increased by 3.1% year-on-year. In the same period, the real estate market continued the trend of weak sales, high completion growth, and decline in new starts.
2. Shanghai Becomes the First Tier-1 City to Implement "Property Recognition Without Loan Recognition" for Housing Provident Fund
According to the Shanghai Municipal Housing and Urban-Rural Development Management, individuals without a property in Shanghai and who have paid off their first provident fund loan are recognized as first-time homebuyers. The notice specifies that for families of contributors who have no property in the city, have never used a housing provident fund personal housing loan nationwide, or who have repaid their first housing provident fund personal housing loan, it will be recognized as a first-time home purchase. Families of contributors who have outstanding housing provident fund personal housing loans nationwide or who have records of two or more loans will not be eligible for loans.
3. Shenzhen Stock Exchange Intensifies the Supervision of Programmatic Trading
The Shenzhen Stock Exchange stated that for investors in programmatic trading who fail to fulfill their reporting obligations, submit false reports, or have other non-compliant situations, the exchange may take corresponding regulatory measures according to the provisions of the "Shenzhen Stock Exchange Trading Rules" and other relevant business rules. The measures are for those who did not fulfill reporting obligations before starting programmatic trading, those whose report information did not meet the requirements for being true, accurate, complete, and timely, and other violations mentioned in the notice.
Overseas Markets
1. Iranian Foreign Minister Calls for Comprehensive Sanctions Against Israel
At a special ministerial meeting of the Organization of Islamic Cooperation held in Jeddah, Saudi Arabia, to discuss the escalating conflict between Palestine and Israel, Iranian Foreign Minister Hossein Amir-Abdollahian called on member states to immediately impose a full embargo on Israel, including oil sanctions. At the same time, member states with diplomatic relations with Israel should expel Israeli ambassadors. Additionally, Amir-Abdollahian called for the formation of a group of Islamic lawyers to collect evidence of war crimes committed by Israel in Gaza.
2. China’s Holdings of US Treasury Securities Drop to a New Low Since 2009
In August, amidst the downgrading of the United States' sovereign credit rating by Fitch, market concerns about the Federal Reserve's continued tightening, and economic outlook, China and Japan, two of the largest US Treasury security holders, showed divergent actions. China continued to sell off, with holdings reaching a new low, while Japan slightly increased its holdings. The US Department of Treasury’s International Capital Movement report (TIC) showed that China's Treasury holdings fell below $810 billion in August for the first time since May 2009, decreasing by $16.4 billion from July, marking five months of reduction and a new fourteen-year low for the third consecutive month.
3. US Mortgage Rates Exceed 8% for the First Time Since 2000
According to the latest data from Mortgage News Daily, on October 18, the average rate for a 30-year fixed-rate mortgage in the US rose to 8%, marking the first time this has occurred since mid-2000. Just two years ago, the average rate for a 30-year fixed-rate mortgage was only 3%. This means that if a buyer made a 20% down payment on a $400,000 house, their current monthly mortgage payment would be nearly $1,000 higher than two years ago.
4. Beige Book Indicates US Economic Growth Expected to Stabilize
The Federal Reserve's Beige Book reported that in the six weeks up to October 6, economic activity showed little change compared to the previous report. The labor market's tightness continued to ease, and prices rose moderately; most regions saw a slight increase in employment and moderate wage growth, with businesses modifying compensation plans to mitigate rising labor costs. Consumers became more price-sensitive, making it harder for businesses to pass on costs; businesses expect the pace of price increases in the coming quarters to be lower than in the previous ones.
Today's Focus
Today, investors should pay attention to Japan's merchandise trade balance, Australia's labor market report, US initial jobless claims, and existing home sales data, among other economic indicators. Additionally, investors should be aware of the Israel-Palestine situation, China's National Bureau of Statistics' monthly report on housing sales prices in 70 major and medium-sized cities, and a speech by the Federal Reserve Vice Chair, Jefferson, along with other risk events.
