- As a slew of news on China, Italy, and US banks stoked concerns about the financial system and the global economy, bond yields fell globally and shares fell.
- There was a broad shift towards safety in all markets. The 10-Yr Treasury yield decreased by 10 basis points, and the German equivalent rates decreased by 13 basis points. The dollar index increased by around 0.4%.
- After Italy proposed an unexpected tax on windfall earnings, banks reported the largest losses in Europe, sending shares of UniCredit and Intesa Sanpaolo down more than 6%. As Moody's downgraded the credit ratings of 10 small and midsize lenders and issued a warning about the risks associated with commercial real estate, investors will also be closely monitoring US financials.
- After China disclosed additional statistics that demonstrated that its economic engine is faltering, investor mood also suffered. Last month, imports decreased and exports fell by the greatest since the start of the Covid epidemic in early 2020. A measure of European mining shares and the Hang Seng China Enterprises Index both decreased by roughly 2%. Oil and copper prices both fell by roughly 1% as the price of commodities declined.
- ECB's Consumer Survey: Euro zone inflation 3 years ahead seen at 2.3% vs 2.5% in previous poll.
