Dow Sinks 652 Points as Oil Jumps; Fed Week Begins
As of 2026-10-26 00:00 SGT
Key points
- The Oct 23 NY session closed sharply lower: the Dow fell 652.82 points (-1.23%) to 52,215.16 as rising oil prices and higher long-end yields weighed on sentiment
- The Nasdaq also slipped as AI-funding jitters resurfaced; Goldman Sachs cut its 12-month KOSPI target by 25% (from 12,000 to 9,000) over AI-trade concerns
- WTI crude trades at $103.27, clearing the prior session's (Oct 22) $100.17 high, while Brent briefly topped $117, a five-month high, on Middle East escalation risk
- Gold futures sit at $4,007.90, below the prior session's $4,036.80 low, as the 10-year yield (4.988%, +3.5bp) pressures the non-yielding metal
- US markets remain in their weekend lull in NY local time, so CME futures for equity indices, gold and oil are not quoted; this week brings a packed central-bank calendar (FOMC, RBNZ, BOC) plus the UK budget and Big Tech earnings
Market snapshot
| Instrument | Level | Change |
|---|---|---|
| USD/JPY | 156.81 | +0.02% |
| EUR/USD | 1.1204 | -0.16% |
| Nikkei 225 (close) | 62,693 | -0.34% |
| Hang Seng (close) | 23,093 | +0.69% |
| Bitcoin | 80,528 | -0.30% |
| US 10-yr yield | 4.988% | +3.5bp |
Foreign exchange — USD/JPY stuck in a tight range
USD/JPY trades at 156.81 (+0.02%), inside the prior session's 157.14-156.10 range, while EUR/USD holds at 1.1204 (-0.16%), also within its 1.1226-1.1187 band. Higher US yields would normally support the dollar, but risk-off flows from the equity selloff and the oil spike offset that pull, leaving the dollar without a clear direction. With US cash markets still closed for the weekend, moves stay contained. Ahead of the Tokyo open, USD/JPY should keep trading around the Oct 22 session's 156.10-157.14 range
Equities — Wall Street slumps on oil and AI-credit jitters; Asia closes firmer
The Oct 23 Dow fell 652.82 points (-1.23%) to 52,215.16 as oil prices rose and long-end yields climbed, with weak breadth also weighing into the close. AI-funding concerns intensified as credit stress around "neocloud" providers spread toward chipmakers, and Goldman slashed its 12-month KOSPI target by 25% (12,000 to 9,000) on AI-trade crowding. Away from Wall Street, the Nikkei 225 closed Oct 23 at 62,693 (-0.34%) while the Hang Seng finished firmer at 23,093 (+0.69%), a contrast to the US weakness. With NY still in its weekend close, Tokyo and the rest of Asia will be first to react to the Oct 23 selloff. Early in the Asia session, watch whether chip-related weakness carries over or the Hang Seng's relative strength holds
Macro — Yields stay elevated into a packed central-bank week
The 10-year Treasury yield sits at 4.988% (+3.5bp), staying elevated as the oil-price jump keeps inflation risk in view. This week's calendar is unusually heavy: the Fed is widely expected to hold its policy rate at 4.00% in the early hours of Oct 29 (SGT), alongside US Q3 GDP (forecast 3.2% q/q) and core PCE (forecast 0.3% m/m) on the same day. The RBNZ (forecast 3.00%) and the BOC (forecast 2.50%) deliver their own rate decisions on Oct 28, alongside the UK's Annual Budget Release. France's bond market remains under pressure amid fiscal strain and renewed street protests. This week's cluster of central-bank decisions, against a 4.988% 10-year yield, should set the tone for risk appetite
Commodities — Oil extends gains on Middle East risk; gold slips toward $4,000
WTI crude trades at $103.27, above the prior session's $100.17 high, extending its advance as Middle East tensions keep supply risk in focus; Brent briefly traded above $117, a five-month high. Gold futures, at $4,007.90, sit below the prior session's $4,036.80 low, with the metal briefly breaking under the $4,000 handle over the weekend before paring losses, as rising long-end yields weigh on the non-yielding metal. Early in the Asia session, oil's resilience and gold's softness look set to continue as a contrasting pair
Geopolitics — Middle East tension and French political risk in focus
The US is withdrawing personnel from parts of the Middle East after receiving intelligence on Iranian attack planning, while Israel has locked down the entire West Bank ahead of its election following a shooting incident, underscoring the region's heightened alert level. Chinese state television's release of high-resolution satellite imagery of Taiwan has also drawn attention as a sign of rising cross-strait tension. In France, large nationwide protests over the weekend again turned violent in Paris despite being largely peaceful elsewhere, and French government bonds remain under selling pressure as the country's fiscal and political strain drags on. These geopolitical and political risks should keep oil underpinned and risk sentiment cautious heading into next week
Upcoming events
| Time (SGT) | Region | Event | Why it matters |
|---|---|---|---|
| 10/27 22:00 | US | CB Consumer Confidence (forecast 80.5) | Gauges consumer resilience ahead of the holiday shopping season |
| 10/28 08:30 | AU | CPI y/y (forecast 4.2%) | Shapes RBA policy expectations; watch AUD's reaction |
| 10/28 09:00 | NZ | Official Cash Rate (forecast 3.00%) | A hold vs. another cut could move NZD sharply |
| 10/28 20:30 | UK | Annual Budget Release | Tax and fiscal-repair measures could swing gilt yields and sterling |
| 10/29 02:00 | US | Fed Funds Rate (forecast 4.00%) | A hold is expected, but the statement/press-conference tone will drive USD and US equities |
| 10/29 20:30 | US | Core PCE Price Index m/m (forecast 0.3%) | The Fed's preferred inflation gauge, landing right after the FOMC decision |