© Reuters.
By Geoffrey Smith
Investing.com — China’s economy slowed more sharply in the third quarter than expected, with industry in particular ending the quarter on a weak note. U.S. industrial production data for September are due later. U.K. bonds fell as the Bank of England gave its clearest warning yet of an imminent interest rate hike, while even the ECB raised an eyebrow at signs of rising price expectations. approached an all-time high as regulatory approval neared for the first Bitcoin-based ETF. Oil prices continued to rise, and natural gas prices shot up in Europe as Russia indicated it wasn’t going to open the taps for November. Here’s what you need to know in financial markets on Monday, 18th October.
1. China’s growth slowdown
The Chinese economy slowed more than expected in the third quarter, as a wave of Covid-related lockdowns disrupted activity across key sectors and the slow-motion trainwreck of China Evergrande and other overleveraged developers shifted up a gear.
Annual gross domestic product growth slowed to only 4.9% from 7.9% in the three months through June, as falling home sales and tightening credit conditions hit the real estate sector and pollution regulations forced a broadening shutdown of energy-intensive industry. Lockdowns meanwhile depressed retail sales, despite a rebound in September as they were lifted.
In quarter-on-quarter terms, the economy grew only 0.2%, less than the 0.5% expected, with industrial production weakening sharply as the quarter ended due to a worsening energy market balance.
2. Bitcoin approaches all-time high
Bitcoin approached a new all-time high, reaching $62,634 overnight, still supported by expectations that the U.S. Securities and Exchanges Commission will formally approve at least two exchange-traded funds offering exposure to the digital currency.
Such a move would instantly expand the access of both retail and institutional investors to Bitcoin movements – although it would not by itself immediately affect the adoption of the digital asset as a means of payment, given that both funds under consideration – backed by Invesco and Proshares – are based on cash-settled Bitcoin futures that already trade on the Chicago Mercantile Exchange, rather than Bitcoin itself.
The Proshares Bitcoin Strategy ETF has Monday as its listing date on the New York Stock Exchange, but that doesn’t necessarily mean trading in it will begin today.
3. Stocks set to open lower; output data due as Philips warns
U.S. stock markets are set to open the week cautiously both in response to the Chinese data and with an eye to the flood of quarterly earnings due this week.
That said, the week gets off to a relatively quiet start with grocery chain Albertson’s, and the banks State Street (NYSE:) and Zions heading a short list of companies reporting. Overnight, Dutch medical devices…