Crude Oil Spikes as Washington Tightens Sanctions on Moscow, Wall Street Rebounds: Oct. 23, 2025

Crude oil climbed almost 5% today after a lack of progress on a potential Ukraine peace deal drove Washington to slap additional sanctions on Moscow. The EU followed with restrictions of its own in a show of camaraderie with the US; however, the heightening tension is concerning to energy market watchers and causing prices to climb because it could reduce supplies as well as shift shipping routes. In stocks, strong corporate earnings have sparked a rebound from yesterday’s selloff, which was worsened intraday by President Trump weighing whether to curb software exports to Beijing. Meanwhile, the risk-on advance is being capped by Tesla’s poorly received profitability report, and the company’s shares are falling in light of a bottom-line miss and slow headway with AI, autonomous cars and robots. Still, all major domestic equity benchmarks are gaining alongside the greenback, which is being bolstered by rising interest rates. Indeed, the yield curve is ascending in bear-steepening fashion led by duration, as surging energy costs dial up short-term inflation expectations. The incremental return of geopolitical angst has traders picking up gold and silver again, but a weak existing home sales print that missed estimates pushed lumber down despite a modest increase in residential transactions. Elsewhere, copper futures are catching bids. Conversely, volatility protection instruments are experiencing lighter premiums due to lessening hedging demand amidst offensive positioning by investors; natural gas is also descending.

Home Sales Increase, But Miss Expectations

Existing home sales climbed modestly last month as improved affordability alongside greater inventories supported closings, but the print missed expectations. Indeed, a mix of lighter mortgage rates together with valuation expansion that is trailing both overall inflation and paycheck growth helped results. The 1.5% month-over-month (m/m) climb in the annual pace of transactions drove the headline number to 4.06 million, beneath the projected 4.1 million while above August’s 4.0 million. Regional participation was broad, although the Midwest printed a 2.1% m/m decrease. The West, Northeast and South saw m/m gains of 5.5%, 2.1% and 1.6%. The single-family segment rose 1.7% m/m, but the condominium and cooperative category hampered progress, coming in unchanged. Meanwhile, median prices rose just 2.1% year over year (y/y), up 2.3% for the former component but down 0.6% on the latter. Supply climbed 1.3% m/m and 14% y/y to 1.55 million units, translating to a monthly ratio of 4.6 months, which is the amount of time it would take at the current tempo to sell those unsold properties.

Investors Brace for Consumer Price Index

With the 2- and 10-year Treasury notes near the critical levels of 3.50% and 4.00%, tomorrow’s special release of the September Consumer Price Index is likely to heavily influence fixed-income trading. The bar is elevated in my opinion as I’m anticipating a lighter-than expected result at 3% for both the overall gauge and its core counterpart, driven by softening housing charges. The consensus, meanwhile, is a loftier 3.1%. While bond bulls would probably need a softer-than-projected reading to get a rally, stocks are poised to advance whether results meet or miss the forecast. But folks, a hotter publication at 3.2% will spark bearish enthusiasm in rates and equities and drop the chance of a Fed reduction in December from 90% to around 60%.

International Roundup

South Korea Maintains Key Interest Rate

The Bank of Korea decided yesterday to extend its rate cutting stance, leaving its key benchmark at 2.5%, but it also maintained its outlook that additional monetary easing is possible. Policymakers expressed fears that lowering financing costs could increase the number of individuals taking out mortgages to buy homes at a time when outstanding household debt is a significant concern. In a related matter, South Korea recently expanded districts and other areas that are subjected to stricter property rules, including loan requirements. Meanwhile, the bank believes consumption will continue to strengthen domestic demand and the country’s strong semiconductor industry will support export activity. Nevertheless, uncertainty regarding ongoing trade talks with the US are headwinds to South Korea’s global commerce.

Hong Kong Inflation Is Stable

Hong Kong’s CPI was up 0.1% m/m and 1.1% y/y, matching the results of the preceding month, according to the Census and Statistics Department. The following items and the extent of their price increases contributed to the y/y result.

• Transportation, 2.5%
• Alcoholic drinks and tobacco, 1.8%
• Housing, 1.7%
• Miscellaneous services,1.5%
• Meals out and takeaway food, 1.3%
• Electricity, gas and water, 0.6%
• Miscellaneous goods, 0.1%

Meanwhile, the durable goods, category, the clothing and footwear group and basic goods experienced declines of 3.1%, 2.8% and 0.1%.

Singapore Inflation Hotter than Anticipated

Singapore consumers faced a slightly lower rate of m/m cost increases in September relative to August’s results, but price pressures accelerated on an annualized basis and exceeded expectations. The nation’s CPI was up 0.4% m/m and 0.7% y/y in September after 0.3% m/m and 0.5% jumps in the preceding month. Core CPI, which strips out items with volatile prices, moved from a 0.3% August ascent to a 0.4% uptick last month, exceeding the economist consensus estimate of 0.2%. For the y/y headline, economists anticipated a 0.6% northward movement. Within the headline m/m metric, no categories experienced declines while transportation became 1.6% more expensive followed by the 0.7% hikes for the clothing and footwear group and the recreation, sport and culture classification.

Canada Retail Sales Weaken

Retail sales in Canada are believed to have fallen 0.7% m/m in September, according to a preliminary release from Statistics Canada. Meanwhile, the country’s final release for August shows gains of 1% and 0.7% for the headline and core m/m metrics.