Market News

Headlines:

• Crude oil remains under pressure amid US-Iran deal hopes; setbacks could push prices to new highs
• Qatari mediators presented Iran with new draft deal; Iran's response expected by the end of the week
• Gold rebounds on renewed hopes for US-Iran deal as focus shifts to FOMC decision
• Wall Street faces a double test as Fed decision and Microsoft, Alphabet earnings loom
• Heads up: UK autumn budget puts Healey to the test as gilt markets await fiscal reassurance
• Germany consumer sentiment remains weak ahead of November as inflation fears cloud recovery outlook
• Germany's trade struggles with China set to put Asia-Pacific deficit on course for record high

Markets:

• AUD leads, NZD lags on the day
• 10-year Treasury yields up 2.5 bps to 5.017%
• Gold down…

he U.S. dollar is mixed heading into a North American session with two central-bank decisions and major technology earnings on the calendar. The Bank of Canada announces its decision this morning, followed by the Federal Reserve this afternoon. After the closing bell, Microsoft and Alphabet will provide the next important test for technology shares and the AI investment story.

Treasury yields are higher, with the U.S. 10-year yield above 5%. Stock futures are mixed: the Dow is lower, while the S&P 500 and Nasdaq 100 point to modest gains. Oil is higher, while gold and silver are trading lower.

Overnight, the biggest currency move came from New Zealand. The RBNZ unexpectedly held its official cash rate at 2.75%, with the committee divided in…

• Prior was -132.6

These are the two worst back-to-back months since just before Liberation Day, when goods were flooding into the US to try to front-run Trump's tariffs. Excluding Jan-Mar 2025, it's the worst two-month period ever. Needless to say, tariffs aren't working.

For background, the advance goods trade balance is part of the Census Bureau’s Advance Economic Indicators report, released at 8:30 am ET roughly four weeks after the reference month ends. The same release includes advance estimates for wholesale and retail inventories, making it one of the more useful early inputs for tracking GDP.

The headline figure is the US deficit in goods trade, the difference between the value of goods exported and imported. It’s broken down by…

Microsoft and Alphabet report tonight. Wall Street's earnings recovery has a catch.

Earnings reactions are improving across more companies, but some heavyweight stocks are still dragging down the broader picture. Now a Federal Reserve decision, followed by earnings from two AI giants, will put that improvement to the test.

Wednesday, October 28, 2026, could be one of the most consequential days of this earnings season.

Microsoft (MSFT) and Alphabet (GOOG, GOOGL) report after the market closes, following the Federal Reserve's interest rate decision and press conference. The options market is pricing moves of approximately 5.1% for Microsoft and 6% for Alphabet through Friday.

But before those results arrive, there is something interesting…

• Wholesale inventories: +0.6% MoM. Prior +0.5%, unrevised.

• Retail inventories: +0.3% MoM. Prior revised to +0.3% from +0.2%.

• Wholesale inventories: $1,011.5 billion, up 7.4% YoY.

• Retail inventories: $885.3 billion, up 4.8% YoY.

US wholesale inventories rose 0.6% in September, following a 0.5% increase in August, according to the Census Bureau’s advance estimates.

Retail inventories increased 0.3%, matching August’s upwardly revised gain. Both wholesale and retail inventories remained above year-earlier levels. The figures are adjusted for seasonal variations and trading day differences, but not for price changes.

Quick analysis: Wholesale stockbuilding picked up, while retail inventory growth held steady. Inventories can support gross domestic…

The Office for Budget Responsibility (OBR) lowered its near-term growth forecasts but the government still expects to meet its fiscal rules, with £15 billion of headroom at the end of the forecast period.

The headline growth revisions:

• 2026 GDP: 1.2% vs 1.1% in March

• 2027 GDP: 1.0% vs 1.6% in March

• 2028 GDP: 1.6% vs 1.6% in March

• 2029 GDP: 1.8% vs 1.5% in March

• 2030 GDP: 1.7% vs 1.5% in March

• 2031 GDP: 1.6%

The sharp downgrade to 2027 is the standout number, with growth now expected at just 1.0%. The revisions further out are more constructive but that's the usual tactic.

On the fiscal side, the numbers show a deterioration in the debt outlook:

• 2026/27 public sector net financial liabilities: 83.2% of GDP vs 82.6% previously

• 2027/28: 83.8% vs…

Zcash extended the gains yesterday as renewed hopes for a US–Iran deal helped improve risk sentiment across crypto markets. Reports that Iran's security chief met with Supreme Leader Khamenei raised hopes of a potential agreement. However, a sustained recovery in ZEC will likely require more concrete progress, as setbacks or renewed tensions could quickly reverse recent gains.

There might also be some pre-positioning ahead of the upcoming NU7 network upgrade, targeted for early November. The upgrade is expected to reduce block times from 75 seconds to 25 seconds and introduce changes to the network's fee mechanism, potentially improving transaction speed and long-term…

USD:

The Federal Reserve is widely expected to keep interest rates unchanged. With no new projections or dot plot expected at this meeting, changes in Fed Chair Warsh's or statement's language will be the main focus.

Despite higher September inflation data strengthening the case for further tightening, key Fed members have signalled little urgency to deliver a back-to-back rate hike in October. A hawkish hold remains the base case as the debate centres around the timing and extent of further tightening rather than direction.

Warsh is expected to reiterate that monetary policy is not sufficiently restrictive and that additional tightening is warranted. He's also seen…

UK chancellor Healey has a rather unenviable task at hand today. He is expected to deliver a budget that keeps households happy, businesses afloat, and bond investors calm. All while trying to convince everyone that the government isn't running short of money. Well, good luck with that.

It is definitely quite the juggling act for his first autumn budget. And with borrowing costs still elevated and fiscal headroom shrinking, there's not exactly much room for him to get creative.

So, what goodies can Healey realistically pull out of the bag today? And perhaps more importantly for markets, it is the question of who's going to end up paying for them?

Here are some of the key measures to watch out for:

• Bank tax hike: A potential reversal of the…

Crude oil came under some pressure yesterday after Iran's state media reported that Iran's security chief met with the Supreme Leader Khamenei.

Sources said that Khamenei stressed in the meeting the importance of pursuing Iran's interests and implementing its conditions with the aim of ending the war and the stalemate situation.

It was just a quick headline with little substance, but market’s expectations for a potential US-Iran deal strengthened, nonetheless.

This morning, Reuters reported that Qatari mediators presented Iran with new draft deal in Tehran on Sunday and that Iran is considering the proposal, with response expected by the end of the week. The report added …

Ethereum rallied yesterday as renewed hopes for a US-Iran deal helped improve the risk sentiment. The market reacted to reports that Iran's security chief met with Supreme Leader Khamenei, who reportedly stressed the importance of pursuing Iran's interests and securing its conditions to end the war and break the stalemate.

The prospect of de-escalation could support Ethereum in the short-term but a sustained trend will need more concrete developments. With the US midterm elections approaching, markets are increasingly sensitive to developments that might bring the conflict closer to an end or lead to another escalation.

This morning, Reuters reported that Qatari…

The central bank bonanza definitely kicked off with a bang today. While markets have been talking about the Fed all week, the RBNZ offered traders a bit of a reality check earlier today to not take anything for granted. Even with traders pricing in a roughly 90% chance of a 25 bps rate hike, the central bank instead held rates at 2.75% in a close 4-3 vote.

The surprise in terms of market reaction is captured by the kiwi, with NZD/USD down 1.3% to 0.5605 today. But is there a broader lesson that goes beyond what we have seen so far?

For the better part of the last decade, traders have grown accustomed to central banks offering plenty of forward guidance and holding their hands through major policy decisions. Central bankers would more or…