At the time of writing this article – 12pm Sydney time on Monday – US futures for the S&P500 and NASDAQ are flat; +0.03% and -0.03% respectively.
That could, if you wanted to be poetic, sum up what global markets broadly are currently thinking about with regards to the USA. They don’t know what to think.
We could see those futures numbers for Wall Street change in the coming hours. In fact, this is almost guaranteed – it’s Sunday night for Americans right now. And then, of course, there’s Trump’s latest apparent assassination attempt.
Gold hasn’t immediately skyrocketed, though it’s still clocked fresh record territory around US$2,584/oz. But there was no immediate spike when reports of this second apparent assassination attempt dropped. Brent Crude unchanged; US natgas unchanged.
Given gold’s recent performance, it’s not obvious if it wouldn’t have hit US$2,584 in the next 24 hours regardless, but it’s probably safe to bet at least some are hoarding, spurred by the Trump headlines.
(Worth noting is how many publishers are using the word “apparent” to describe this latest event from the Trump Ecosystem of Curiosities. I am going to sustain that trend for reasons, full disclosure of bias, I’d hope are obvious.)
Stealing attention from the Fed?
There is, of course, something else arguably more important that happens later this week the world is watching: the looming US interest rate decision from the Federal Reserve.
On 18th September US time we get what is widely expected to be at least a -25bps cut from the Fed on the national interest rate – the first cut to come after the US, and the world, began ramping up rates to combat inflation.
Markets have been oscillating between two theories more than anything else: the Fed will cut 25bps, or it will cut 50bps. Whether it will or won’t cut isn’t really something the zeitgeist is asking anymore.
In other words: as far as the market cares, it’s all but guaranteed. You can read my weekly wrap at the end of this week to see how that decision changes things as they stand on Monday.
Don’t forget that only days ago, markets started rallying up the price of multiple commodities as Putin threatened to ban exports in response to western sanctions over its war in Ukraine.
Gold and oil modest as AI still strong
Perhaps what is most telling for political considerations about the immediate response to the latest Trump news is that neither gold, nor Brent crude, have particularly done anything exciting. (I am using Brent despite the US caring more about WTI; ultimately, the WTI and Brent benchmarks rarely break out of correlation.)
That gold and oil haven’t done anything interesting in response to the second apparent attempt on Trump (remembering it’s still Sunday night in the US) is perhaps an eyebrow raiser, given both of those commodities rise during geopolitical conflict.
It suggests markets don’t really see the incident as a tradeable event.
Or maybe it’s because the last attempt didn’t really affect markets one way or the other in any week-by-week meaningful sense and that with NVIDIA having jumped +13.5% over the last 5 days – shaking off the second real test we’ve seen to the AI thesis – markets simply don’t care.
It’s worth reflecting on NVIDIA, who is the other large force driving markets – or at least catching the mood in the room.
Just two weeks ago, the company shed off the entire value of Chevron in one session, just astronomical amounts of money. Around A$415B, no less. It’s since bounced back and recovered those losses.
To further underscore the megacap tech value proposition, Apple remains the largest company in the world.
While it’s latest Glowtime event did not shake markets like many on Wall Street predicted – shares are up only +0.7% over the last 5 days but nearly +30% over the last 6 months – it, too, is harping on a lot about AI – which it calls “Apple Intelligence.” You can decide whether you think that’s tacky or not.
At any rate, and as ever, there’s no shortage of movement to watch coming out of the USA right now.
But with commodity responses subdued as it currently stands at lunchtime Monday Sydney time, it appears that markets care more about The Fed move later this week.