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On October 25th, local time, Sudans Rapid Support Forces (RSF) announced their control of Bara, a major city in North Kordofan State, central Sudan. The statement stated that the RSF launched a full-scale offensive against the Sudanese Armed Forces (SAF)-held city, inflicting thousands of casualties and injuring hundreds, ultimately securing full control of the city. The statement also stated that retaking Bara is a significant step toward full control of the Kordofan region. The SAF has yet to respond to the statement.Pakistans Defense Minister: We see Afghanistans desire for peace, but failure to reach an agreement will mean open war.On October 25th, local time, the second round of ceasefire talks between Pakistan and Afghanistan began in Istanbul, Turkey. The talks were hosted by Turkey and held at an Istanbul hotel. The Pakistani delegation included the militarys director of operations and security and intelligence officials. The Afghan delegation was led by Deputy Interior Minister Rahmatullah Najeeb.On October 25th, Belgorod Oblast Governor Ilya Gladkov announced that Ukrainian armed forces had damaged the Belgorod Reservoir Dam. He stated that Ukrainian forces might attempt to attack and destroy the dam again. If this were to happen, several streets in riverbanks and settlements near Kharkiv Oblast would be flooded, impacting the lives of approximately 1,000 residents. Gladkov stated that local authorities have advised residents at risk of flooding to move to temporary relocation sites. The Ukrainian side has not yet responded to this request.On October 25th, Bank of France Governor François Villeroy de Villeroy warned lawmakers debating the 2026 budget that the deficit must not exceed 4.8% of economic output to ensure France can cope with its growing debt burden. The French National Assembly is currently debating a draft budget that targets 4.7% GDP growth, but Prime Minister Jean-Claude Le Cornu has said the ultimate target should be within 5%, and he is seeking a compromise with opposition lawmakers. "It is absolutely necessary to keep the deficit below 3% between now and 2029, which would imply a maximum deficit of 4.8% next year," Villeroy de Villeroy said in an interview with La Croix. He also stated that France faces the risk of "progressive suffocation" from debt and that additional deficit spending will fail to stimulate economic growth. According to calculations by the Bank of France, if debt uncertainty is reduced, a 1% reduction in the household savings rate would boost economic growth by 0.4%. However, Villeroy de Villeroy stated that the French economy has strong momentum this year and growth will be "at least" as strong as the Banks forecast of 0.7%.

As Fed worries eclipse earnings, the market closes

Haiden Holmes

Oct 21, 2022 14:19

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On Thursday, U.S. shares closed lower due to job market numbers and comments from a U.S. official. A member of the Federal Reserve confirmed forecasts that the central bank will swiftly raise interest rates, despite a surge in outstanding corporate earnings.


IBM (NYSE:IBM), up 4.73% after the IT services giant beat quarterly profit estimates on Wednesday and said it expected to meet full-year sales growth targets, contributing to early market gains. After its annual profit forecast was raised, AT&T Inc (NYSE:T) climbed 7.72%.


However, the markets were unable to sustain their gains as high weekly unemployment claims and comments from Federal Reserve Bank of Philadelphia President Patrick Harker fuelled fears of a Fed rate hike and a potential recession.


As long as high inflation remains, according to Harker, the Fed will continue to boost its short-term rate target, contributing to the rise in the yield on 10-year U.S. bonds. At 4.239%, the Treasury note yield has achieved its highest level since June 2008.


"Interest rates cause equities volatility, that's how we've viewed things all year," said Zachary Hill, portfolio management head at Horizon Investments in Charlotte, North Carolina. Observing a fall in interest rate volatility is a precursor to observing a lull in the equities market and becoming more comfortable with taking on further risk.


I am not certain that we will be able to observe the halt that some Fed officials and market players have pointed to.


The Dow Jones Industrial Average down 90.22 points, or 0.3%, to 30,333.59, while the S&P 500 dropped 29.38 points, or 0.80%, to 3,665.78 and the Nasdaq Composite fell 65.66 points, or 0.61%, to 10,444.84.


The profit growth forecast for the third quarter of S&P 500 companies is now 3.1%, up from 2.8% earlier in the week, but far lower than the 11.1% increase forecasted at the beginning of July.


Tesla (NASDAQ:TSLA) fell 6.65% after the electric-vehicle manufacturer announced that fourth-quarter deliveries increased by less than the projected 50%.


This year, as the Federal Reserve works to combat persistently rising inflation, concerns about the impact of the Fed's aggressive path of interest rate hikes on company earnings and the broader economy have grown.


According to supplementary statistics, existing home sales fell for the eighth consecutive month in October, while factory activity in the region served by the Federal Reserve Bank of Philadelphia decreased once again.


At its November meeting, the U.S. central bank will likely announce a fourth consecutive 75 basis-point rise, with a remote chance of a one-percentage-point increase.


The volume on U.S. exchanges was 11.37 billion shares, compared to the 20-day daily average of 11.62 billion shares.


On the NYSE, declining issues outnumbered those that were gaining by a ratio of 2.12 to 1; on the Nasdaq, the ratio was 1.34 to 1.


The S&P 500 posted three new 52-week highs and twenty-eight new lows, while the Nasdaq recorded fifty-three new highs and two hundred thirty-nine new lows.

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