Morning wrap (24.09.2025)

Wall Street ended Tuesday’s session with the first more significant profit-taking this month. The biggest correction was recorded by the Nasdaq (-0.95%), followed by the S&P 500 (-0.55%), Russell 2000 (-0.25%) and DJIA (-0.2%). Futures on major indices in the EU and US are currently trading slightly higher (EU50: +0.03%, US30: +0.1%).

The catalyst for the sell-off in the US was Jerome Powell’s speech. According to the Fed Chair, there is no risk-free policy path ahead – inflation remains at an elevated level and the dynamics of the labor market have slowed. Interest rates therefore remain somewhat restrictive to prevent further acceleration of price dynamics, and further cuts will be adjusted cautiously based on incoming data. Powell added that the stock market is “quite highly valued,” which, combined with economic uncertainty, motivated profit-taking.

The Trump administration is renegotiating a $2.26 billion Department of Energy loan for Lithium Americas for the Thacker Pass project in exchange for a 10% stake. The mine in Nevada, key for the lithium supply chain and production of batteries for electric vehicles, is expected in 2028 to produce 40,000 tons of raw material annually. Following the announcement, the company’s shares rose by nearly 80%.

Trump commented that Ukraine, with EU and NATO support, can return to its original borders and pledged further arms deliveries to NATO.

Sentiment in the Asia-Pacific region indicates investor caution after yesterday’s sell-off on Wall Street. Indices in China are trading higher (CHN.cash: +1.1%; HK.cash: +1%), AU200.cash is down 0.65%, India’s Nifty 50 extends its correction (-0.35%), and Japan’s Nikkei 225 is slightly below the line (JP225: -0.05%).

CPI inflation in Australia amounted to 3% y/y in August, the highest since July 2024. The main factors were: housing (+4.5%), food and non-alcoholic beverages (+3%) and alcohol and tobacco (+6%). The continued price pressure supports a more cautious stance by the RBA, and thus a slower pace of further interest rate cuts.

The preliminary PMI report for Japan for September showed the weakest increase in activity in 4 months (PMI Composite: 51.1, previously 52, forecast). The index for manufacturing fell more sharply than expected (48.4, forecast 49.5, previously 49.7), the lowest since March, weighed down by a sharp drop in orders and exports. The development of services partly balanced the reading thanks to strong domestic demand. Employment growth was the weakest in 2 years.

The Australian dollar is currently the strongest G10 currency, supported by hawkish expectations regarding the RBA (AUDUSD: +0.35%), while the New Zealand dollar is also gaining ground (NZDUSD: +0.1%). The U.S. dollar is rebounding after two days of declines (USDIDX: +0.15%), gaining the most against Nordic currencies (USDNOK: +0.3%, USDSEK: +0.2%). The yen, on the other hand, is recording losses against all G10 currencies (USDJPY: +0.15%, EURJPY: +0.1%). EURUSD is down 0.1% to 1.1803, halting a 3-day winning streak.

In precious metals, the euphoria continues: gold adds 0.2% to 3,770 USD per ounce, silver 0.3% to 44,195 USD per ounce, contracts for platinum are also in the green (+1%) and palladium (+0.15%).

Bitcoin rebounds 0.1% to 112,490 USD, Ethereum extends losses by 0.7% to 4,151 USD.