Stock market undercurrents: Yen depreciation and triple witching day combined impact, this day's market may experience intense volatility

Today’s financial markets can be described as an “autumn of turmoil,” with seemingly calm trading surfaces hiding underlying currents. The Bank of Japan’s rate hike decision, the unexpected weakening of the yen, and the upcoming “Triple Witch” expiration of options on US stocks—all these factors are intertwined, presenting a challenging puzzle for market participants.

Bank of Japan Rate Hike Signals “Dovish” Stance, Yen Plunges

The Bank of Japan announced a 25 basis point rate hike as expected, raising the policy rate to 0.75%, the highest level since 1995. Logically, this should be positive for the yen, but the reality is quite the opposite. Governor Ueda Haruhiko’s lack of clear guidance on further rate hikes during the press conference disappointed the market.

The result is evident—USD/JPY rose by 1.05%, breaking the 157 level to close at 157.09. The unexpected depreciation of the yen directly impacted Japan’s stock market and global risk assets that are sensitive to exchange rates. This serves as a warning to global investors: central bank policies depend not only on data but also heavily on market expectations, and the latter’s disappointment can have a greater impact.

US Stock Options Expiry, $7.1 Trillion in Nominal Value to Be Released

Today also features another “time bomb”—the arrival of the Triple Witch expiration. According to Goldman Sachs’ data, over $7.1 trillion in options contracts will expire today, setting a new record high. About $5 trillion of this is linked to the S&P 500 index, which means trading volume and volatility are expected to significantly increase.

Analysts are closely watching whether the S&P 500 can hold the critical support level of 6800—this is not only a technical boundary between bulls and bears but also a critical point for market confidence. A breach could trigger a chain reaction.

Stock Divergence Evident, Tech Stocks Show Resilience

Despite some uncertainty in the broader environment, individual US stocks are showing divergence. Dow futures are up 0.14%, S&P 500 futures up 0.33%, and Nasdaq 100 futures up 0.43%. The futures gains suggest that tech stocks are relatively resilient.

Specifically, NVIDIA (NVDA) rose 1.36%, Tesla (TSLA) increased 1.13%. Oracle (ORCL) performed notably well, surging 5.95%, benefiting from recent developments in TikTok negotiations and positive signals from OpenAI funding talks. This indicates that while market sentiment has some turbulence, expectations for tech innovation companies remain solid.

Cryptocurrency Rebounds Against the Trend, Short-term Risk Appetite Rises

Interestingly, amid pressure on global risk assets, cryptocurrencies are showing a rebound. The liquidity easing signals from the yen’s depreciation and the market’s reassessment of global monetary policies have boosted investors’ risk appetite.

As of press time, Bitcoin (BTC) is up 2.91%, trading at $87,949. Ethereum (ETH) gained even more, rising 4.35% to $2,949. However, caution is warranted: approximately $23 billion worth of Bitcoin options will expire next Friday, which could further amplify market volatility. Investors should prepare accordingly.

Precious Metals Diverge Further, Funds Quietly Rebalance

The performance of precious metals presents a different picture. Gold, although at a historical high, edged slightly lower today. Meanwhile, platinum has risen for the seventh consecutive trading day, with a latest quote of $1,962 per ounce, up 0.66%. Palladium also moved higher.

This reflects a shift in capital flows: some investors are taking profits from the highly valued gold and reallocating into relatively undervalued, more volatile metals like platinum and palladium. This “capital outflow” effect indicates a structural reallocation of assets in the market.

Overall, today’s US stock market faces pressure mainly from three sources: the liquidity changes driven by yen depreciation, the tidal wave of options expiration on Triple Witch day, and the market’s re-pricing of central bank policies. Under these multiple shocks, support levels near the S&P 500 are particularly critical. What investors need most now is patience and cautious risk management.