Market Brief: Worst Manufacturing PMI in a Decade Slams Risk Appetite

See a summary of the top market themes and trends from today's US trading session!

  • FX: The safe haven Swiss franc was the strongest major currency on the day, while the risk-sensitive Australian and New Zealand dollars were the weakest. AUD/USD dropped to its lowest level since March 2009, the depths of the Great Financial Crisis, before recovering a bit intraday.
  • Reports initially suggested that the EU was willing to consider a time-limited backstop on the Irish border, but an EU spokesperson subsequently denied the speculation.
  • US data: The September ISM Manufacturing PMI report came in at just 47.8, below both the 50.0 reading expected and last month’s 49.1 print; this represents a 10-year low in the key economic gauge. The details of the report weren’t any better, with employment falling to 46.3 and new export orders dropping to just 41.0.
  • Commodities: Gold gained nearly 1% on the day. Oil ticked lower.
  • US indices closed roughly -1% lower across the board after the weak Manufacturing PMI report.
  • All eleven major sectors fell on the day. Defensive Utilities (XLU) fell the least, while the manufacturing-heavy Industrial (XLI) sector fell by the most, over -2%.
  • Stocks on the move:
    • Online brokers including TD Ameritrade (AMTD, -26%) and E-Trade Financial (ETFC, -16%) were clobbered after rival Charles Schwab (SCHW, -9%) announced it would end commissions for online stock, ETF, and options trades.
    • Two of 2019’s biggest IPOs, Uber (UBER, -4%) and Lyft (LYFT, -4%) both hit fresh record lows today as selling pressure mounts.
    • Ford Motor Company (F) fell -3% after booking an impairment charge of $800-900M related to a sale of its assets to an Indian automaker.

*No high-impact macroeconomic events are scheduled for release in Wednesday’s Asian session.*

Build your confidence risk free
Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.