Morning Bid: Speechifying

• Brent crude crossed $100/barrel on hopes Iran would reopen Strait of Hormuz within seven days if US lifted blockades; Saudi Arabia also restarted its East-West Pipeline earlier than expected
• Trump's approval rating plunged to 32% (lowest ever), with only 23% approving his economic handling and 17% his cost-of-living record; Republicans now disapprove 51% to 44% on cost-of-living issues
• US semiconductor index (SOX) added 2% on AI optimism; SoftBank's bond offering headed to become largest junk bond deal ever amid strong demand

Summary: Morning Bid - Speechifying

Key Market Drivers:

Oil markets dominated trading as Brent crude fluctuated around $100 per barrel amid diplomatic developments at the UN General Assembly. US and Iranian officials met with Qatari mediators, fueling optimism about potentially reopening the Strait of Hormuz within seven days if US sanctions are lifted. Iranian President Pezeshkian's scheduled speech and possible Trump meeting added to speculation.

Political Developments:

President Trump's approval rating plummeted to 32%—his lowest ever—with economic approval at just 23% and cost-of-living approval at 17%. Republican disapproval of his cost-of-living handling now exceeds approval (51% vs 44%). Polls show Trump's party losing ground ahead of midterms, with betting markets favoring a Democratic sweep of Congress.

Energy Sector:

Saudi Arabia unexpectedly restarted its East-West Pipeline on Tuesday, weeks ahead of market expectations, adding downward pressure on oil prices alongside diplomatic progress.

Technology Sector:

AI optimism continued driving tech stocks higher, with the SOX semiconductor index gaining 2% Tuesday. SoftBank attracted significant attention as its bond offering is on track to become the largest junk bond deal ever.

Market Outlook:

Global stocks and US futures showed mixed performance Wednesday ahead of the upcoming US-China summit. Bond yields edged higher as central banks emphasized their commitment to returning inflation to target levels.

Key Events:

• US S&P Global flash PMIs for September (9:45 AM EDT)
• US 5-year note auction (1 PM EDT)
• Fed's Michael Barr speech
• Japanese markets closed for holiday