By Margaret Yang, CMC Markets

Despite the Fed’s decision to hold interest rates in its recent September meeting, divergent opinions have emerged between the Fed’s members. Equity markets have since closed lower on Friday. US indices lost around 0.6%, ending a two-session gain. European markets have also retraced, with Financials (-1.18%) and Energy (-1.02%) been the worst performing sectors.

With volatility near to year-to-date low, the spotlight has now shifted from the central banks’ policies to the upcoming US presidential debates between Clinton and Trump on Monday evening (Tuesday morning Singapore time). Investors will be watching closely on the shift of momentum in the race, which could once again trigger a new wave of market volatility.

According to the latest poll, the chance of Donald Trump to win the presidential election has risen to 44%, just a margin below that of Clinton, whose winning probability stands at 46%. If Trump leads in the first presidential debate, we will probably see higher risk premium in the equity market and rising political uncertainties in the United States. As a result, safe-haven assets such as gold, silver and yen will probably enjoy a period of rally.

Crude oil prices tumble ahead of OPEC talks

Oil prices took a dive last Friday as OPEC pre-meeting discussions failed to reach consensus. The likelihood of a production freeze looks more uncertain. WTI Nov contract lost 3.2% and closed at 44.50 area.

The latest news suggested that OPEC members will make another attempt at an informal gathering in Algeria this Wednesday to decide whether to freeze of cut production of oil

In the near term, $43.60 remains a key support level for WTI oil price. Since markets have relatively low expectations on a possible freeze agreement in this meeting, any positive news coming out this Wednesday will lead to a quick rebound in oil prices.

Volatility Index Oct 2016


Notify of
Inline Feedbacks
View all comments
You May Also Like

Government seems to creatively interpret situations to suit its narrative

The Peoples’ Action Party (PAP) seems to be able to creatively interpret…

Experience of being followed or surveilled is “very well-known among some opposition politicians and activists”

Commenting on the recent major blowout, Kenneth Jeyaretnam, Secretary General of the Reform Party (RP), and independent journalist Kirsten Han highlighted their experiences of being followed or surveilled, which are “well-known among some opposition politicians and activists.” As of today, the circumstances surrounding the filming of the video featuring Mr Perera and Ms Seah remain unknown, including when, where, and who filmed it. The video was reported by local media as being leaked on Facebook by a fake profile named “Victoria Wang,” however the post had only tens of shares when the news first broke, hardly enough to be considered viral.

Five environmentally friendly home improvement projects that can actually save you money

by ValueChampion Want to make your home more comfortable and energy efficient? Consider…

S’pore “more than capable” of handling differences as long as govt, political parties “disavow exclusivist thinking”, says academician Cherian George

Singapore will be “more than capable” of handling differences “in ways that…