Stock Market Update

The S&P 500 futures currently trade 80 points above fair value.

Equity indices in the Asia-Pacific region had a lower showing to begin the week while Japan's Nikkei was closed for a holiday. President Trump threatened to impose an additional 100% tariff on imports from China due to China's intensified export controls pertaining to rare earth elements; however, additional comments made over the weekend reduced the market's level of concern about the worst-case scenario. President Trump also said that he has not ruled out meeting with China's President Xi just yet. China's trade surplus for September was smaller than expected despite an increase in the surplus with the U.S. South Korea's exports through the first ten days of October were down 15% due in part to the recent holiday.

• In economic data:
  • China's September trade surplus $90.45 bln (expected surplus of $98.50 bln; last surplus of $102.33 bln). September Imports 7.4% yr/yr (expected 1.5%; last 1.3%) and Exports 8.3% yr/yr (expected 6.0%; last 4.4%)
  • India's September CPI 1.54% yr/yr (expected 1.70%; last 2.07%)
  • New Zealand's September Performance of Servies Index 48.3 (last 47.6) and August External Migration & Visitors 7.5% m/m (last 6.6%)

---Equity Markets---

• Japan's Nikkei: HOLIDAY
• Hong Kong's Hang Seng: -1.5%
• China's Shanghai Composite: -0.2%
• India's Sensex: -0.2%
• South Korea's Kospi: -0.7%
• Australia's ASX All Ordinaries: -0.9%

Major European indices trade mostly higher. Concerns about a new batch of aggressive tariffs on imports from China have receded after President Trump assured over the weekend that the relationship with China will "all be fine" and that he has not ruled out meeting with China's President Xi. French President Macron reappointed Sebastien Lecornu as prime minister, who faces an immediate deadline to present a budget for 2026. The Dutch government seized control over Chinese chipmaker Nexperia due to a security threat being posed by the company.

• In economic data:
  • Germany's September WPI 0.2% m/m, as expected (last -0.6%); 1.2% yr/yr (last 0.7%)

---Equity Markets---

• STOXX Europe 600: +0.3%
• Germany's DAX: +0.2%
• U.K.'s FTSE 100: -0.1%
• France's CAC 40: +0.2%
• Italy's FTSE MIB: +0.3%
• Spain's IBEX 35: +0.3%