On Tuesday (September 22, Beijing time) in early Asian trading, spot gold was trading around $4,360 per ounce, pressured by market expectations of progress in the US-Iran situation during the UN General Assembly and a decline in inflation concerns. Oil prices fell nearly 4% on Tuesday, with the market hoping that this week's UN General Assembly would push for diplomatic progress in the Iran war, while also paying attention to the partial resumption of Saudi Arabian oil shipments. US crude oil is currently trading around $92.18 per barrel, and may test the $90 per barrel mark during the day.

Key Focus Today

stock market

U.S. stocks rose on Monday, driven by renewed optimism surrounding AI. The Nasdaq Composite surged 2.26% to 27,122.09, its first record closing high since June 2nd. The S&P 500 gained 1.49% to 7,764.70, and the Dow Jones Industrial Average climbed 0.71% to 52,048.83. AMD jumped about 10%, its market capitalization surpassing $1 trillion for the first time. Intel surged 12.2%, Arm jumped 17%, the Philadelphia Semiconductor Index jumped 4.3%, and Meta rose 11.4% after Wells Fargo raised its price target. Meanwhile, the yield on the 10-year U.S. Treasury note fell below 5%, and Brent crude oil fell below $100 a barrel, hitting its lowest level since September 9th, as markets speculated that Middle East talks during this week's UN General Assembly might yield a breakthrough. Following the Federal Reserve's first rate hike in three years last week, traders believe there is a 50% probability of another rate hike next month, and at least 10 Fed policymakers are scheduled to speak this week. Greenland-related U.S. stocks rose on progress in U.S.-Denmark diplomatic negotiations, while Paramount Skydance fell nearly 3% on news that it had reached a settlement with 12 states, including California, on an $110 billion exploration merger with Warner Bros. Eight of the 11 sectors in the S&P 500 rose, with communication services leading the gains at 4.16% and information technology up 2.4%.

Gold Market

Gold prices fell on Monday, with spot gold down 0.78% to settle at $4,343.70 an ounce, as expectations of further monetary tightening by the Federal Reserve this year and hawkish signals from other major central banks boosted the dollar. The dollar rose slightly against six major currencies, extending gains of over 1% following last week's Federal Reserve rate hike. This increased the cost of gold for holders of other currencies, according to Jim Wyckoff, market analyst at the U.S. Gold Exchange. Bulls remain concerned about a tightening of U.S. monetary policy, which pushed the dollar index to a more than two-month high on Friday. These negative factors are putting pressure on the precious metals market. The CME FedWatch tool shows traders currently expect an 88% probability of a Fed rate hike in December. While gold is traditionally seen as an inflation hedge, its attractiveness relative to interest-bearing assets decreases in a high-interest-rate environment. TD Securities analysts said they expect any short-term weakness in the precious metals market to be limited, only affected by mild selling from commodity trading advisors (CTAs), and will increasingly be seen as a good opportunity to buy gold. Spot silver fell 0.35% to settle at $66.02 an ounce, platinum rose 0.3% to $1805.83 an ounce, and palladium rose 0.4% to $1307.33 an ounce.

oil market

Oil prices fell to a 12-day low on Monday, with WTI crude down 3.67% to settle at $91.97 a barrel and Brent crude down 3.06% to settle at $100.03 a barrel. Both benchmark crudes fell to their lowest levels since September 9, as investors hoped that this week’s UN General Assembly would push for diplomatic progress in the war with Iran, while also focusing on the partial resumption of Saudi Arabian oil shipments. US President Trump expressed his willingness to meet with Iranian President Pezechio Yann, who is expected to attend the UN General Assembly in New York this week. Al Jazeera reported that Iran has conveyed its conditions for resuming negotiations to the mediators. PVM Oil Associates analyst Tamas Varga said investors are hoping for a breakthrough in peace talks this week. Bob Yag, head of energy futures at Mizuho Securities, said, "Just a few days ago, this seemed like a very distant idea," adding, "This is a step in the right direction." The Middle East conflict continues, with the Houthi rebels claiming attacks on Riyadh and a Saudi Aramco facility in Yanbu. Tanker tracking data showed that Saudi Aramco loaded approximately 14 million barrels of crude oil onto seven supertankers in the Gulf of Mexico on Sunday. Satellite data showed that Saudi crude oil transported through the Strait of Hormuz averaged 2.9 million barrels per day over the past six days, up from 700,000 barrels per day in August.

Foreign exchange market

The dollar index rose 0.2% on Monday to close at 100.41. CME Group's FedWatch tool showed traders expect a 55.4% probability of the Federal Reserve raising interest rates by at least 25 basis points in October, up from 43.5% a week earlier. Chicago Fed President Goolsby and St. Louis Fed President Musalaim both indicated that further or faster rate hikes may be needed to combat inflation driven by strong demand and energy price shocks. The dollar rose 0.32% against the yen on Monday, closing at 157.37, as the Bank of Japan failed to signal a hawkish stance after last week's rate hike, and market liquidity decreased due to a three-day holiday. Investors were closely watching for signs of potential intervention in Tokyo. Marc Chandler, chief market strategist at Bannockburn Capital Markets, believed intervention at the 157 or 157.5 level was unlikely, but the market was slightly nervous. The euro fell 0.19% against the dollar, closing at 1.1463, as the far-right Alternative for Germany (AfD) party won first place in the northeastern state elections, marking the worst regional election defeat for Chancellor Merz's conservative party since World War II.

International News

The Trump administration has proposed a $5 billion fund to rebuild energy infrastructure in the Gulf region, according to US and several Middle Eastern officials. This proposal aims to help Middle Eastern countries rebuild energy infrastructure damaged in the war with Iran and reduce their dependence on oil and gas transport through the Strait of Hormuz. This move is tantamount to acknowledging that the seven-month conflict has disrupted global energy markets, destroyed pipelines and refineries in the region, and rebuilding these facilities will be extremely costly. Under Trump's plan, the US will seek matching funds from eight Middle Eastern partners—Saudi Arabia, the UAE, Qatar, Bahrain, Kuwait, Oman, Iraq, and Jordan—aiming to establish a $10 billion investment fund. The fund will be named the "Allied Trust and Building Partnership" (Pact). US officials stated that discussions regarding the fund are ongoing and the terms of the arrangements may change. It remains unclear when (or even if) other countries will formally join. EU Extends Sanctions Against Russia for Three Years On the 21st local time, after lengthy consultations, EU member states reached an agreement to extend sanctions against Russia for three years. According to the agreement, the EU will extend sanctions against more than 3,000 Russian individuals and entities for 36 months, while removing two Russian business leaders from the sanctions list. This extension is significantly longer than the usual 6- or 12-month extensions. The EU hopes that by extending the sanctions, it can avoid future deadlocks due to differences in member states' positions on the extension issue. (CCTV News) UK Reportedly to Assist Saudi Arabia in Countering Houthi Attacks According to foreign media reports, the UK is close to agreeing to support Saudi Arabia's military operations against the Houthis. Multiple sources familiar with the matter revealed that British Prime Minister Burnham is inclined to provide what the UK considers defensive assistance. These sources indicated that the UK will lobby other countries to take similar measures. Some say the UK may provide aerial refueling support to Saudi Arabia. One of them pointed out that the Burnham government believes that aiding the Saudi military and repelling the Houthi rebels helps stabilize the regional situation and reduce the threat to ships in the Strait of Malacca. Satellite data shows increased Saudi Gulf crude oil loadings Over the weekend, monitoring showed a significant increase in Saudi Arabia's oil loadings in the Persian Gulf, the clearest indication that the country is shifting its export focus back to the Strait of Hormuz after the closure of a key transnational oil pipeline. According to data from the EU's Sentinel 2 satellite, a very large crude carrier (VLCC) with a capacity of 14 million barrels of crude oil was spotted near Saudi export facilities in the Persian Gulf over the weekend, the highest level since at least June. Earlier this month, Saudi Arabia's vital East-West pipeline was attacked and forced to shut down, and traders are trying to obtain various information about Saudi crude oil exports. Saudi Arabia had previously used this pipeline to bypass the Strait of Hormuz, but after its closure, it has sought to restore oil transport through the strait. Iran's economy contracted by over 10% year-on-year in the first quarter of this year (March 21 to June 20), according to the latest data released by Iranian official agencies. AFP and other media outlets reported that the Iranian Statistical Center released economic data for the first quarter of the Persian calendar (March 21 to June 20) on the 20th. The data shows that during this period, Iran's GDP, including the oil and gas sector, contracted by 10.1% year-on-year; excluding the oil and gas sector, GDP fell by 4.6% year-on-year. Specifically, the oil and gas sector saw the largest decline in output, plummeting by 26.4% year-on-year; industrial and mining output fell by 14.7% year-on-year. (Xinhua) The Iranian Revolutionary Guard warned that if the US launches another attack, it will use new weapons to strike new targets. Hossein Mohbi, spokesman for the Iranian Islamic Revolutionary Guard Corps, stated that if the US launches another attack, the Iranian armed forces will begin using new weapons to strike US targets that have not been attacked before. Fars News Agency quoted Muhbi as saying, "Our targets will no longer be the same as before. We have new targets that we haven't attacked before." He emphasized that these changes will involve the geographical location of the war, the weapons used, and military equipment. He pointed out, "We will deploy new weapons with entirely new capabilities on the battlefield, and the world will be shocked." US diesel prices surpass $6.50 per gallon for the first time, war-driven price increases impacting multiple sectors of the economy. US retail diesel prices have surpassed $6.50 per gallon for the first time, continuing the war-driven price increase and impacting multiple sectors of the economy. Data from the American Automobile Association (AAA) shows that as of Saturday local time, the average price of diesel across the US rose to $6.505 per gallon, less than 10 days after last breaking the $6 mark. Since September, the increase in US diesel prices has accelerated significantly, rising more than 87 cents so far this month, rising almost daily, and significantly exceeding the peak reached in 2022.

Domestic News

China-US Trade Talks Held in New York On September 20 local time, He Lifeng, Vice Premier of the State Council and China's lead negotiator for the China-US trade talks, held trade talks in New York with their US counterparts, US Treasury Secretary Bessenter and Trade Representative Greer. Guided by the important consensus reached by the two heads of state and adhering to the principles of mutual respect, peaceful coexistence, and win-win cooperation, the two sides conducted frank, in-depth, and constructive exchanges on important trade and economic issues of common concern, including implementing the consensus reached in previous trade talks and promoting bilateral trade and investment. They also held a dialogue on issues related to artificial intelligence. (Xinhua)