Are markets about to pivot?

Welcome to Charts and Caffeine - Livewire's pre-market open news and analysis wrap. We'll get you across the overnight session and share our best insights to get you better set for the investing day ahead.

NOTE: Due to the start of daylight savings in parts of Australia, US markets now shut at 7 am AEDT, rather than 6 am, AEST.

MARKETS WRAP

• S&P 500 - 3,783.28 (-0.20)
• NASDAQ - 11,148,64 (-0.25)
• CBOE VIX - 28.55 (-1.79%)
• USD INDEX - 111.21 (1.04%
• US 10YR - 3.757% (0.12%)
• FTSE 100 - 7,052.62 (-0.48%)
• STOXX 600 - 398.91 (-1.02%)
• UK 10YR - 4.031% (0.165)
• GOLD - 1,725.00 (-1.32%)
• WTI CRUDE - 88.03 (1.75%)

CALENDAR

THE CHARTS

The word doing the rounds today is "pivot". Not the kind you see on a basketball court. The kind where central banks slow down on their rate hikes. Sweet relief may be on the horizon. 

It's early days, but here are few graphs which all point to a pivot. 

1) The US labour market is softening. This has been widely cited as a key predicate that needs to be seen before the Fed takes its foot off the brake. 

2) Goldman is predicting both headline and core inflation to fall. 

3) The yield on US 10 year treasuries has [maybe] peaked out. 

 4) the market now expects central banks so level off cash rates. 

STOCKS TO WATCH

Aussie iron ore miners finished September strongly. The three majors ASX: RIO, ASX: BHP, ASX: FMG) increased shipping rates 3.4% WoW, with higher iron-ore shipments reported by all three majors. However, Macquarie only has an outperform rating on BHP, with RIO and Fortescue garnering Neutral and Underperform ratings respectively. 

"BHP is our preferred large-cap exposure as the company boasts stronger organic growth options," say analysts.

"WAIO is progressing its production debottlenecking program to 300mtpa, enabled by port debottlenecking, South Flank ramp-up and latent capacities. 330mtpa studies are underway with results expected in 2025, which could be accelerated by BHP’s constructive iron-ore outlook, in our view."

David Thornton  wrote today's report. 

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