US-CHINA: US To Secure Rare Earths In 2 Years, Sign China Deal Shortly - Bessent
Oct-31 16:18
MNI London: The FT has published an interview with US Treasury Secretary Scott Bessent, conducted after Thursday’s meeting between President Donald Trump and Chinese President Xi Jinping. Bessent said the US and China would sign the deal over the coming week, adding he is confident of the deal's durability as the two powers “have much better communication channels now.”
- Bessent said that while “equilibrium” was reached at the meeting, “China would no longer be able to use critical minerals as a coercive tool,” as the US would secure alternative rare earth supplies within two years.
- Bessent: “There’s an agreement that, ceteris paribus, we have reached an equilibrium, and we can operate within that equilibrium over the next 12 months.”
- On rare earth export controls, Bessent said: “China has alerted everyone to the danger. They’ve made a real mistake. It’s one thing to put the gun on the table. It’s another thing to fire shots in the air.” Bessent added, “I think the Chinese leadership were slightly alarmed by the global backlash to their export controls.”
- On TikTok, Bessent said, “Everything’s ironed out in terms of the permissions, and we should see a transaction very soon.”
- On tariffs, Bessent said: “We’ve set a standard, and I wouldn’t be surprised if the rest of the world doesn’t follow. Our trade deficit with China is down 25 per cent this year. China’s manufacturing activity has now contracted for seven straight months. Maybe they will make the decision themselves.”
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US STOCKS: Midday Equities Roundup: Health Care & Utilities Outperforming
Oct-01 16:15
- Stocks gaining ahead midday Wednesday, political distractions at bay as focus turns to fundamentals rather than the US Government shutdown as of midnight Tuesday. Additional support for equities could be tied to the Supreme Court denying Pres Trump's demand to fire Fed Gov Cook, allowing her to stay on at least until oral argument on the case is heard in January 2026.
- Currently, the DJIA trades up up 56.81 points (0.12%) at 46453.89, S&P E-Minis up 6.75 points (0.1%) at 6745.5, Nasdaq up 39.5 points (0.2%) at 22698.78.
- Leading gainers ahead midday included Health Care and Utility sector shares, pharmaceuticals leading the former: Regeneron Pharmaceuticals +9.06%, Moderna +8.75%, Biogen +7.67%, Amgen +6.75% and Eli Lilly +6.66%.
- The Utilities sector was buoyed by AES, the energy company surging 16% higher in the first half as wires reported BlackRock's GIP is in advanced talks to purchase the company. Follow-through support for other energy companies includes: Constellation Energy +3.79%, Vistra +3.33%, PG&E +3.18% and NextEra Energy +2.41%.
- Conversely, Materials and Communication Services sectors led decliners by midday. Weighing on Materials: Corteva -7.05%, Ecolab -1.95%, Linde -1.92% and Eastman Chemical -1.53%. Meanwhile, News Corp -5.62%, Interpublic Group -4.12% and Omnicom Group -3.95% weighed on the Communication sector in the first half.
OPTIONS: Larger FX Option Pipeline
Oct-01 16:00
- EUR/USD: Oct03 $1.1700(E1.2bln), $1.1845-55(E2.2bln), $1.1875(E1.2bln); Oct06 $1.1700(E1.1bln); Oct07 $1.1650(E1.8bln), $1.1750(E1.0bln), $1.1820(E1.7bln)
- USD/JPY: Oct03 Y148.00($1.0bln); Oct06 Y147.00($1.3bln)
- EUR/GBP: Oct03 Gbp0.8785-05
- AUD/USD: Oct03 $0.6600(A$1.5bln); Oct06 $0.6700(A$1.1bln)
- NZD/USD: Oct03 $0.6450(N$1.2bln)
US 10YR FUTURE TECHS: (Z5) Bounces Off Support At The 50-Day EMA
Oct-01 15:45
- RES 4: 114-10 High Apr 7 (cont.)
- RES 3: 114-00 Round number resistance
- RES 2: 113-12/29 High Sep 18 / High Sep 11 and the bull trigger
- RES 1: 112-31/113-00 High Oct 01 / High Sep 24
- PRICE: 112-22+ @ 16:41 BST Oct 1
- SUP 1: 112-01 50.0% retracement of the Jul 15 - Sep 11 bull phase
- SUP 2: 111-26 Low Aug 26
- SUP 3: 111-13+ Low Aug 18 and a key support
- SUP 4: 111-01+ 76.4% retracement of the Jul 15 - Sep 11 bull phase
Prices bounced Wednesday, despite the short-term bear cycle. Recent weakness has resulted in a print below the 50-day EMA, currently at 112-10+. A clear break of this average would undermine a bull theme and signal scope for a deeper retracement. This would open 111-13+, the Aug 18 low and the next key support. On the upside, initial firm resistance to watch is unchanged, at 113-00, the Sep 24 high.
