Good morning. US stock futures traded lower in Thursday morning trading as investors digested the Federal Reserve’s latest commentary that future rate hikes are not out of the picture.

"Permabears create high anxiety — but perhaps that’s what some investors secretly want"

William Sherden

Top News

Inflation still major concern for the Fed

WHAT: The US Federal Reserve is making one thing clear: they’re not done fighting inflation! According to the Fed’s most recent meeting minutes, most members were concerned about “significant upside risks to inflation” and suggested more rate hikes could be needed.

WHY: San Francisco Fed President Mary Daly, Minneapolis Fed President Neel Kashkari and Fed Governor Michelle Bowman have all argued in recent weeks that there’s more work to do to bring inflation down to the Fed’s target of 2%.

WTO: Chinese duties on US imports “inconsistent”

WHAT: The World Trade Organization (WTO) just dropped a verdict hotter than a Sichuan pepper! The organization’s dispute settlement panel found that China had acted inconsistently with its WTO obligations by imposing additional duties on certain US imports in response to US tariffs on steel and aluminum.

WHY: The US imposed a 25% duty on steel imports and a 10% duty on aluminum imports in March 2018 based on the Donald Trump administration’s “Section 232” national security investigation into steel and aluminum imports.

US mortgage rate climbs to two-decade high

WHAT: The US 30-year mortgage rate just stretched its legs up to 7.16% — the highest level since 2001 — crimping both sales and refinancing activity. The latest jump in borrowing costs presents a fresh set of headwinds for the housing market, just as the sector has been showing signs of finding its footing.

WHY: The impact from high mortgage rates is two-fold: it restrains demand, and keeps many Americans who are sitting on lower mortgage rates from listing their homes.

In Other News

Shopping for groceries - literally!

 WHAT: Aldi, the discounter shopper’s paradise, is about to go on a grocery shopping spree! The company announced plans to buy 400 Winn-Dixie and Harveys supermarkets in the southern US. If the deal is approved by regulators, it is expected to close in the first half of 2024.

WHY: The deal comes amid wider consolidation in the grocery industry as customers increasingly defect to big box stores like Walmart.

PayPal to halt UK crypto sales

WHAT: PayPal is hitting the pause button on its crypto shopping spree for UK customers. PayPal will “temporarily pause” the ability for customers to buy cryptocurrency on its platform from October 1st, as it works to satisfy new UK regulations which come into effect from October 8th the company said in an email to customers.

WHY: Regulators around the world are increasingly seeking to regulate crypto assets after the collapse of several crypto firms last year left amateur investors with large losses.

TikTok ban favored in US

WHAT: A recent Reuters/Ipsos survey reveals that nearly half of American adults are giving a thumbs-down to short-form video sharing app TikTok. Some 47% of respondents to the poll said they at least somewhat supported “banning the social media application, TikTok, from use in the United States.”

WHY: TikTok said in a statement that more than 150 million Americans, including 5 million US businesses actively use the app to earn a living, engage in the classroom and find community.

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• Thursday - Philadelphia Fed Manufacturing Index

• Friday - Baker Hughes Total Rig Count

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