GGMA Markets Briefing: Oil Eases After Trump Announces a Russia-Ukraine Energy Ceasefire as Korean Stocks Slide
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Here is a brief summary of today’s Markets Briefing: Oil Eases After Trump Announces a Russia-Ukraine Energy Ceasefire as Korean Stocks Slide
· Oil fell after President Donald Trump said Russia and Ukraine had agreed to an energy ceasefire, two days after his deal to bring Russian diesel to the world market.
· A US jet disabled a tanker that had left an Iranian port and a supertanker caught fire in the Strait of Hormuz, as Iran called the US response on reopening the strait insufficient.
· South Korean stocks slid as the AI trade that lifted them struggles for buyers, while the won strengthened.
· India's rupee jumped after the Reserve Bank of India unveiled one of its biggest currency-support packages in more than a decade.
· Bond-market pressure is pushing Europe's indebted governments to trim their plans, and a large asset manager is unwinding Treasury futures positions.
· Japan's Prime Minister Sanae Takaichi is moving away from the reflationist label under pressure from markets and Washington, with Tokyo closed for a holiday.
Today's Macro Roadmap: Swiss sight deposits at 10:00 CET, and the Bank of England's Breeden and Mann and the Fed's Hammack among the central-bank speakers.
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GGMA Markets Briefing: Oil Eases After Trump Announces a Russia-Ukraine Energy Ceasefire as Korean Stocks Slide
Oil fell initially, but then recovered, after President Donald Trump said on Sunday that Russia and Ukraine had agreed to an "energy ceasefire" (BBG), two days after he agreed a deal to bring Russian diesel to the world market (WSJ). Brent fell 0.6% and WTI 1.1%.
S&P 500 futures rose 0.2% and Euro Stoxx 50 futures 0.4%, and South Korea's Kospi slid 3.5%. Cash Treasuries do not trade today because of the Columbus Day holiday (BBG), and Japanese markets are closed.
In stocks, S&P 500 futures stood at 7,878 and Nasdaq 100 futures rose 0.2%. DAX futures rose 0.5% to 25,354. One major bank turned overweight on stocks for the next three months, citing earnings growth (BBG). The Kospi fell to 6,394. The AI trade that lifted Korean stocks is struggling for buyers as turnover dries up and foreign investors pull out (BBG). The Hang Seng Index rose 0.2% to 24,251, and China's CSI 300 fell 0.6% to 4,291. Nikkei futures fell 0.3% to 69,230, and India's Nifty 50 fell 0.6% to 22,394. In the US, gains have narrowed to a handful of AI stocks as higher rates weigh on the rest of the market (BBG). Wall Street fears that stretched US consumers could end the rally, with consumer-facing sectors expected to report falling earnings (BBG). Euro-area bank shares have slid as French bond yields rose relative to Germany's, a sign of caution rather than panic (BBG). Lone Pine Capital's flagship fund is up only 0.6% this year after erasing a 44% gain in a brutal quarter (BBG).
Regarding the Fed, Cleveland Fed President Beth Hammack and Dallas Fed President Lorie Logan have said rates are not yet high enough, and New York Fed President John Williams and Governor Philip Jefferson see little urgency to raise them (BBG). Higher bond yields are tightening financial conditions on their own, which may mean fewer rate rises from global central banks (BBG). Meanwhile, about 20% of US families are behind on debt payments, up from 12%, according to a Federal Reserve survey (CNBC).
In the euro area, Governing Council member Mārtiņš Kazaks said the ECB is in a "fairly comfortable situation" on rates (LS). French fiscal risks raise the chance that the ECB pauses after December, a bank's strategists argue (Investing).
In Japan, Prime Minister Sanae Takaichi said this is not a phase in which reflationary policies are necessary, as her government seeks to shed the reflationist label under pressure from markets and Washington (Nikkei). The Bank of Japan raised its policy rate by a quarter point in September, with two board members opposed (Nikkei). Japan's version of DOGE will step up its spending review, eyeing subsidies for electric vehicles and health checks (Nikkei).
Regarding other central banks, Bank of Korea Governor Shin said inflation will stay above target for some time, and South Korea's finance ministry said it is ready to stabilize markets as global yields rise (LS). The Reserve Bank of India set up a special dollar window for state oil companies and curbed corporate hedging (BBG), one of its strongest interventions since 2013 (BBG). The People's Bank of China set its yuan reference rate at the strongest level since February 2023 (LS).
In currencies, the dollar index was little changed at 102.22. Markets are weighing Middle East tensions and this week's US inflation data (Reuters). The euro held at 1.1201, sterling rose 0.1% to 1.3249, and the yen was little changed at 158.32 per dollar. India's rupee jumped 1.1% to 95.76 per dollar. India's reserves fell 51 billion dollars in four weeks (BBG), and traders had expected the central bank's measures to lift the currency (Reuters). South Korea's won rose 0.4% to 1,335.18 per dollar. Lower oil prices and exporters' dollar sales supported the currency (BBG). The offshore yuan was little changed at 6.6938 per dollar. China's central bank is expected to tolerate further gradual gains (WSJ). The Australian dollar fell 0.1% to 0.6979 and the New Zealand dollar 0.1% to 0.5607. In New Zealand, the National Party said it will wait for a budget surplus before cutting taxes, ahead of the 7 November election (BBG).
In bonds, ten-year Treasury futures edged up 0.1%. Bund futures rose 0.3%, French OAT futures 0.3%, Italian BTP futures 0.3%, and gilt futures 0.4%. Australia's ten-year yield fell 2.8 basis points to 5.33%. A large asset manager is unwinding Treasury futures positions, adding to pressure on long-dated bonds (BBG). Rich countries are now on the front line of global financial risk, and the Institute of International Finance puts their annual interest bills above 3.3 trillion dollars (BBG). Officials gather in Bangkok this week for the IMF and World Bank meetings (BBG). The Treasury may cut its 20- and 30-year bond auctions by 3 billion dollars each at the 4 November refunding, a bank's strategists say (NDTV Profit). In Europe, France's budget aims to narrow the deficit to 5% of GDP, and Italy has trimmed planned defence borrowing by 8 billion euros as indebted governments respond to market pressure (BBG).
In commodities, a US jet disabled the Panama-flagged tanker Ocean Molica after it left an Iranian port, the first US attack on a ship in more than a month (FT). A supertanker caught fire in the Strait of Hormuz on Sunday (NY Post), and Iran's Revolutionary Guards said it had hit a mine (Times of Israel). At least 11 tankers were attacked in the week to 4 October and 10 more the following week, and the US has disabled four ships and turned others back (NY Post). Iran said the US response to its seven conditions for reopening the strait was "insufficient" and threatened communications cables, data centres, and AI facilities in the region if fighting resumes (Iran International). Yiping Liao, a portfolio manager at Templeton Global Investments, sees no near-term resolution to the Hormuz crisis before the US midterms (BBG). Russia cleared half a million tons of diesel for export, and the International Energy Agency urged members to speed up emergency diesel releases before its board meets on 15 October (BBG). Under the diesel deal, US sanctions are suspended for about six months (WSJ), though traders have questioned the long-term impact of Russia's extra exports (BBG). A US official said Trump made the deal after Ukrainian President Volodymyr Zelenskyy ignored half a dozen requests to stop striking Russian refineries (Axios). Canada will maximize oil and diesel exports to the US after Prime Minister Mark Carney spoke to Trump, and Trump plans a directive to officials to control the cost of diesel (LS). Gulf crude exports have recovered to 17.5 million barrels a day, 98% of pre-war levels, by one bank's estimate (BBG). Physical Brent cargoes for prompt delivery have reached a record premium over futures as the disruption in Hormuz continues (Nikkei). Tanker shortages are keeping oil prices high despite ample supply (BeInCrypto). By one bank's count, more than four in five of the world's supertankers were in use by September (BeInCrypto). Another bank raised its December Brent forecast by 5 dollars to 90 dollars, citing Middle East supply risks (Binance). A strong earthquake struck Panama, but the canal and the trans-Panama oil pipeline are operating normally (LS). Gold fell 0.3% to 4,183 dollars, and silver was little changed at 60.8 dollars. Traders are weighing the Russia-Ukraine energy ceasefire (BBG). Copper rose 0.6% to 6.73 dollars a pound. Chile's Codelco is racing to rescue workers after a mine accident (LS). China's top economic planner pledged more policy tools to meet this year's growth targets (BBG). Natural gas fell 1.3% to 3.18 dollars. Bitcoin was little changed at 83,698 dollars, and Ether rose 0.7% to 2,553 dollars. US spot bitcoin ETFs drew 21 million dollars of net inflows, ending a run of heavy withdrawals (Pluang).
In geopolitics, the Kremlin said President Vladimir Putin relayed Iran's vision for ending the war to Trump (CNBC), and Iran has preserved its ability to build missiles and drones (JapanTimes). A Houthi strike shut Riyadh's King Khalid International Airport on Saturday, after an attack on Thursday killed three people (Gulf News). The US aviation regulator urged airlines to take care over Saudi Arabia, and BP withdrew from a Riyadh energy conference (LS). Zelenskyy supports the energy ceasefire but is awaiting details (BBG), and he called the diesel accord a "weak decision" (LS). Trump has called for him to be replaced in the dispute (JapanTimes), and Zelenskyy risks a rupture with Washington as midterm pressure mounts (JapanTimes). Seven senators said the deal is illegal, and Russian strikes killed at least 20 people on Saturday (BBG). Russia suffered about ten times as many casualties as Ukraine last month, a senior NATO military official said (BBG). An FT poll puts Trump's approval at 34% (FT). The EU said an accord with China could cut Chinese hybrid-car exports by more than half, before EU leaders meet on Thursday (BBG). The talks ended late on Friday with a consensus covering trade, investment, export controls, and intellectual property, and the bloc intends to use safeguard measures to curb the imports (BBG). Germany said Ireland's proposal to cut 159 billion euros, about 8%, from the EU's 2028-2034 budget is not enough (Politico). North Korea fired a ballistic missile that landed outside Japan's exclusive economic zone (LS).
In corporate news, China's CXMT unveiled progress on a DRAM chip structure that Samsung and SK Hynix are also pursuing, and plans a server product by the end of 2026 (SCMP). Anthropic said its Claude model carried out unintended actions, some of them on government websites (JapanTimes). Firmus's plan for a 30-billion-dollar listing collapsed within 48 hours (BBG). Amazon is in talks to buy AI start-up Decart for about 7 billion dollars (LS).
In other news, this article caught my eye: Dan Ivascyn, chief investment officer at Pimco, told the Financial Times that the US ten-year yield is at risk of reaching 6% for the first time in 26 years, and that a protracted sell-off could push hedge funds out of bond bets (Investing).
Data and the day ahead: No major data were released overnight. Still to come: Swiss sight deposits at 10:00 CET. The Bank of England's Sarah Breeden speaks at 11:30 CET and Catherine Mann at 14:50 CET. The Fed's Beth Hammack speaks at 18:10 CET. China's September money-supply and loan data are due between today and Thursday. Later in the week, US consumer prices on Wednesday are the main release (LS), and Fed Chair Kevin Warsh appears with the IMF's Kristalina Georgieva on Friday.
Time Stamp: 12 October 2026, 08:20 CET