Market News

Bitcoin breakout draws nearly $1 billion into ETFs: More than a short squeeze?

Bitcoin's breakout has evidence of demand beyond forced short covering. Nearly $1 billion entered U.S. spot Bitcoin ETFs on September 21, while Strategy disclosed renewed corporate buying. That strengthens the case for broader investor participation, although ETF flows alone cannot prove that institutions are making lasting, unhedged bets.

I'm was monitoring the crypto space yesterday as multiple catalysts converge, particularly noting how Canada's largest banks are moving to test a tokenized deposit system, a clear signal of institutional infrastructure being built out despite the lack of a set timeline.

Meanwhile, Eamonn Sheridan highlighted a shift in ETF…

Oil is finding itself back at a rather important crossroads. And one that will have implications for broader markets as well.

Brent crude has settled below $100 again after fairly volatile back-and-forth US-Iran headlines since overnight, with the market trying to decide just how much geopolitical risk should still be embedded in prices.

In part, the latest move has been driven by renewed hopes for diplomacy. US president Trump said that talks with Iran were continuing and that he believed a settlement would eventually be reached, even as the rhetoric from Washington remained confrontational. Meanwhile, reports about Iran offering an olive branch of sorts on the Strait of Hormuz has also been met with mixed facts and truths. And that is…

A China inflation forecast below 1% for both this year and next underlines how little price pressure the world's second-largest economy is generating, keeping deflation risk in view and leaving room for further policy support from Beijing. That contrasts with much of the rest of the region, where energy costs tied to the Middle East conflict keep inflation elevated and limit central banks' scope to ease. For commodity markets, an unchanged China growth path offers little sign of a demand-led lift, leaving energy prices driven mainly by supply disruptions. The ADB's expectation of diverging policy paths points to wider dispersion in Asian rates and currencies.

The ADB sees China growing steadily but generating almost no inflation, even as…

• Australia jobs preview: CBA sees 15,000 gain, unemployment steady at 4.5%
• Morgan Stanley prefers Nokia as it turns bearish on Ericsson
• Australia jobs preview: employment seen rebounding in August, jobless rate at 4.5%
• Gold edges up or goes nowhere? Headlines clash as rates and oil pull in opposite ways
• PBOC sets USD/ CNY mid-point today at 6.7468 (vs. estimate at 6.6971)
• How private credit fund redemption gates work, and why Apollo investors still wait
• Follow up ... Trump weighs diesel export ban: can a limited curb avoid the backlash?
• Oil eases as Witkoff says indirect US-Iran talks at UN complete a round
• ADB holds China growth forecast at 4.6%, cuts inflation view as demand softens
• Apollo caps private credit fund withdrawals again, but…

With CBA below consensus and Westpac above it, the major banks bracket the market's 20,000 forecast, so a result anywhere in that band is unlikely to move rate expectations much ahead of next week's widely expected RBA hike. The bigger swing factor is the unemployment rate: CBA's view that it needs to drift higher to curb inflation means a surprise dip would strengthen the case for further tightening beyond September, supporting the Australian dollar and short-end yields. A jump toward 4.6% or above would do the opposite, reinforcing the idea that the RBA is nearing the end of its cycle. The pick-up in some job advertisement measures that CBA flags is a reminder that the softening is not one-way.

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Earlier:

• RBA governor Bullock flags…

A price target set below the prevailing share price signals Morgan Stanley sees further downside rather than a mere pause, and its below-consensus margin forecasts point to the risk of broader earnings downgrades across the sector. The call reinforces the view that telecom operators are in no hurry to lift mobile network spending, a headwind for all radio equipment vendors, although Morgan Stanley's stated preference for Nokia suggests it sees relative winners. Rising semiconductor costs add a theme that could spread to other hardware makers exposed to component inflation. Ericsson's third-quarter results will be the next test of whether the margin squeeze is materialising.

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Morgan Stanley thinks Ericsson's best margin days are behind…

The data land days before the Reserve Bank of Australia's 29 September meeting, where a rate increase is widely expected, so a result near or above forecasts would do little to shift near-term pricing but could firm expectations for further tightening in November. A second straight fall in employment, or a jump in unemployment, would challenge the case for a follow-up hike and could weigh on the Australian dollar and short-dated bond yields. With the forecast range spanning 10,000 to 47,000, the scope for surprise is wide in both directions. Traders are also likely to weigh the release against the September flash PMI, which pointed to the steepest fall in private sector employment since 2020.

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Earlier:

• Australia flash PMI: growth slows to…

Gold's direction now hinges on which inflation signal wins: falling oil, which would ease pressure on bond yields, or central banks that have already shown they are willing to keep hiking. A firmer dollar alongside tighter Fed policy is a headwind for any rally, while steady central bank buying and elevated geopolitical risk continue to limit the downside. A US-Iran settlement is a genuine two-way risk, since lower oil could support gold through lower yields even as reduced safe-haven demand weighs on it. Until one force clearly dominates, range trading looks the most likely outcome.

--- Gold spent Wednesday going roughly nowhere, which did not stop two major newswires from describing the journey in entirely different terms.

Summary:

• Spot…

The redemption mechanics matter for the business models of alternative asset managers, which have leaned heavily on wealthy individual investors to fuel private credit growth. Prolonged gating risks denting fundraising through that channel, even where fund returns remain positive, and may push managers toward product changes such as more frequent valuations or larger liquid buffers. For credit markets, the gates themselves are stabilising: they spare funds from selling loans into weak markets, limiting the risk of forced sales feeding through to broader private credit pricing. Scrutiny from regulators and distributors over how "semi-liquid" products are marketed is likely to intensify.

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Earlier:

• Apollo caps private credit fund withdrawals…

The PBOC allows the yuan to fluctuate within a +/- 2% range, around this reference rate. More here on this.

• PBoC injects 8bn yuan via 7-day reverse repos at 1.40%

Talk of a partial ban keeps the risk of a split market alive: any curb would likely widen the gap between US and European diesel prices, supporting European gasoil while weighing on Gulf Coast product prices and refining margins. A capped version reduces the chance of refiners cutting crude runs, which lowers the risk of knock-on gasoline tightness, but uncertainty alone may push importers in Latin America and Europe to secure alternative supply now. With diesel already the tightest part of the oil complex, even modest restrictions could add to upward pressure on international product prices. Crude itself is less directly exposed, although lower US refinery runs would trim domestic crude demand.

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A partial diesel export ban is the…

Confirmation of a structured, mediator-led process, rather than one-off contacts, chips further at the geopolitical risk premium in crude, adding to pressure from recovering Saudi exports and rising Hormuz traffic. The indirect format and Iran's long list of conditions suggest a deal remains distant, so downside is likely to be gradual and headline-driven rather than a one-way slide. Any sign that talks are stalling, or fresh Houthi attacks on Saudi infrastructure, could quickly rebuild the premium. Refined products, with diesel already at record highs, remain the tightest part of the market and may respond less to diplomatic progress than crude.

--- Washington and Tehran are now talking in earnest through intermediaries in New York,…