Week in a Glance: Energy Crisis and Disastrous September

4 oct 2021

Last week, as well as September as a whole, turned out to be very disastrous for the US stock market. As a result, September justified the title of the worst month for the US stock market over the past 70 years, losing about 5%.

A great many problems have accumulated and the end is not yet in sight. No sooner had the Chinese developer Evergrande missed one bond payment than the turn of the next payment came last week. He also had to be skipped.

But this is not even what the markets are concerned about right now. The energy crisis has spread from Europe to Asia and China in particular. Gas prices in Europe have already exceeded $ 1,100 per thousand cubic meters. A gasoline crisis erupted in Britain, and even had to use the army to resolve it. Well, China simply introduces rolling blackouts and stops production in a number of provinces. And although the consequences are not yet fully clear, analysts have already lowered their forecasts for China's GDP growth just in case.

And the problems don't end there. The US miraculously managed to avoid the shutdown, but the specter of default looms ahead, because the US government debt ceiling was raised, and Yellen, meanwhile, called the “end of the world” date - October 18 (that's when the money will run out and the US can default).

In general, in this form, we enter October and the new week.

What to expect from this week? The key event is the publication of data on the US labor market. Although they are unlikely to change something radically.

Today OPEC is meeting and maybe even a surprise awaits us in the form of an increase in production by an amount more than the planned 400K b / d.

Plus, we continue to follow what is happening in the US Congress.

For the rest, the basic strategy is selling in the US stock market and buying dollars in the foreign exchange market.