Bitcoin Rises as U.S. Stock Futures Point to Recovery — Market Talk
0705 GMT - Bitcoin rises slightly as U.S. stock futures point to a higher open, recovering from falls after Wednesday's interest-rate rise by the Federal Reserve. The Fed lifted rates by 25 basis points, which was more than 90% priced by markets, according to LSEG. However, the unanimous vote in favor of the move along with officials' projections for at least one more rate increase briefly hit market sentiment. Tech stocks helped to limit the impact of the decision though as the Philly Semiconductor Index advanced, Deutsche Bank analysts say in a note. Oil prices are also lower as headlines suggest an improved outlook for oil flows out of the Middle East, they say. Bitcoin rises 0.5% to $76,474, LSEG data show.([email protected])0651 GMT - Investors will pay attention to the vote split at the Bank of England interest rate decision due at 1100 GMT and it's assessment of the U.K. second-round inflation effect, Capital.com's Daniela Hathorn says in a note. The BOE is expected to keep interest rates on hold at Thursday's policy decision. Nonetheless, markets fully price in three quarter-point BOE rate rises by March 2027, LSEG data show. The U.S. Federal Reserve raised interest rates on Wednesday, as widely expected, and Fed Chairman Kevin Warsh emphasised that inflation remains high. ([email protected])0645 GMT - Eurozone government bond yields open slightly higher, responding to an initial rise in U.S. Treasury yields following the Federal Reserve's well-anticipated 25-basis-point rate hike Wednesday. The rate hike, and perhaps more so the Fed's unanimous vote, increased global bond markets' trust in the Fed's resolve to return inflation to target. "The unanimous Federal Open Market Committee vote says more than the 25-basis point hike itself," CIFC Asset Management's Natalia Lojevsky says. Eurozone bonds might get some input from Spanish and French bond auctions on Thursday. The 10-year Bund yield rises 0.7 basis points to 3.510%, while the 10-year French OAT yield is up 1.2 basis points at 4.471%, according to Tradeweb. ([email protected])0642 GMT - The outlook for Singapore's non-oil domestic exports remains strong, driven by the global artificial intelligence infrastructure build-out, Maybank economists say in a report. NODX rose 46.2% on year in August, marking the fastest pace of growth since October 1988. Semiconductor-equipment demand is still robust amid the expansion in global chip fabrication capacity. China's growing modern infrastructure spending is also driving up demand for specialized machinery and semiconductor chips. Maybank forecasts Singapore's 2026 NODX growth at 18%, above Enterprise Singapore's 14%-16% forecast.([email protected])0628 GMT - The dollar eases slightly but remains elevated after reaching a one-and-a-half-month high overnight following the Federal Reserve's unanimous decision to raise interest rates by 25 basis points, as anticipated. Fed officials pencilled in at least one more rate rise this year while Chairman Kevin Warsh said inflation is too high and has been for too long. President Trump once again called for lower rates following the decision. "The greatest danger for the dollar lies in the president increasing pressure on the Fed again in the coming weeks, which could lead to renewed doubts about the Fed's independence," Commerzbank's Michael Pfister says in a note. The DXY dollar index trades falls 0.1% to 100.192 after reaching 100.367 overnight. ([email protected])0621 GMT - UBS thinks the Fed will undertake another 25bp rate hike at the December FOMC meeting, says economist Jonathan Pingle. The FOMC is likely to pass on raising rates at the October meeting, just as the Fed waited and evaluated events in June and July, he says. That would avoid raising interest rates six days before the U.S. midterm elections, he adds. UBS forecasts the Fed to hold in 2027 and lower rates at the June 2027 meeting. "We might be staring at a much more hawkish FOMC reaction function for the next four years compared to the last forty," Pingle says. ([email protected]; @ivy_jiahuihuang)0603 GMT - Federal Reserve Chairman Kevin Warsh's tone was "on the hawkish side," Jefferies's Mohit Kumar says in a note. He refers to Warsh's comments that financial conditions can hardly be described as restrictive, and that the interest-rate hike removed a dose of accommodation, suggesting that more increases are to come, the global economist says. Warsh didn't provide any forward guidance, "but the focus was on credibility and that the Fed would act to make sure that inflation is reaching back toward their goal," Kumar says. ([email protected])0557 GMT - The Federal Reserve has finally begun its hiking cycle, and the debate now shifts from whether rates will rise again to how many hikes lie ahead, Principal Asset Management's Seema Shah says in a note. "The unanimous vote shows that rising energy prices and stubborn inflation have brought even the doves on board, making a one-and-done move highly unlikely," the chief global strategist says. With markets already pricing multiple increases, policymakers will probably need to deliver at least one more hike to safeguard credibility, she says. "Moreover, with inflation not projected to return to target until 2029 under the current path, the case for further tightening in 2027 remains compelling." ([email protected])0552 GMT - The Federal Reserve had no choice but to give the market a hike or risk a much bigger bond market selloff, which is shown in the 12-0 vote, Laffer Tengler Investments' Byron Anderson says in a note. "The Fed is trying to calm the bond market rather than signaling a hiking cycle," the head of fixed income says. The market narrative is on a collision course with the Fed from here on out, which means more volatility, he says. ([email protected])0547 GMT - A unanimous decision by the Federal Reserve to raise rates, and the suggestion of an additional hike later this year, will help remove some uncertainty for the market, Catalyst Funds' Larry Holzenthaler says, adding that it is a positive. "It's fair to assume that if the Fed had not acted today [Wednesday], it would have caused meaningful strain across markets," the senior portfolio manager says. This rate hike--and suggestion of more to come--should keep the demand for low-duration credit fairly high, in particular senior corporate loans, which have a floating rate coupon structure, and the same can be said for higher-yielding, shorter-duration bonds as well, he says. ([email protected])0541 GMT - The Federal Reserve's decision to raise rates doesn't necessarily mark the start of a sustained upward momentum in the dollar, DBS's Philip Wee writes. "This is not the U.S.-led hiking cycle in 2022," says the foreign-exchange strategist. The Fed is catching up with major central banks in responding to inflation risks and preventing energy price shocks from generating second- and third-order effects across the economy, he notes. The Treasury market also remains a key drag on confidence, with yields staying firm on 10-year and 30-year Treasurys, suggesting that the struggle over long-term borrowing costs is unresolved, Wee adds. DBS sees the DXY dollar index remaining in the 96-102 range established since mid-2025. The DXY is flat at 100.278. ([email protected])0538 GMT - U.S. Treasury yields are little changed in Asian trade, absorbing the Federal Reserve's 25-basis-point interest-rate hike Wednesday and the prospect of more tightening to come. "Despite the hike, there is potential for some relief from investors now that the Fed has caught up with the market in terms of rate projections," says Stephen Coltman, head of macro at 21shares, in a note. "The FOMC is officially forecasting one more rate hike this year, in line with current market pricing," he says. This suggests the risks for investors going forward around the Fed have now become more two-sided, he says. The two-year Treasury yield falls 0.7 basis point to 4.719%, while the 10-yer yield is flat at 5.003%, according to Tradeweb. ([email protected])