By Geoffrey Smith 

Investing.com — Federal Reserve Chair Jerome Powell will field questions on the economy, the debt ceiling and the trading activities of his subordinates when he testifies in front of Congress. China’s central bank advises not to panic, and is heard. However, the U.K. government is not as successful, with energy prices reaching new highs across Europe. (Gazprom stock (MCX:), also hit a 13 year high. Stocks are set to open lower as money pours out of tech and into value, while the API will say whether stockpiles managed to recover from three-year lows. OPEC will update its view on the global oil market. This is what you should know about financial markets Tuesday 28 September. 

1. Powell faces some awkward questions

Federal Reserve chairman Jerome Powell heads to Congress to testify on the state of the U.S. economy but, with the start of a tapering of asset purchases looking more and more likely in November, the occasion is likely to be overshadowed by the resignation of two regional Fed presidents on Monday.

After revelations about their active trading of single stocks last year and financial products in other areas, Eric Rosengren of the Boston Fed and Robert Kaplan of the Dallas Fed resigned. This raised suspicions regarding a conflict. Rosengren stated that he was concerned about his health and Kaplan said the negative publicity caused by the disclosures led to him resigning.

Powell could also be quizzed about the effects of not lifting debt ceiling in order to fund the Federal Government. On Monday, 10-year Treasury bonds yields rose above 1.50 percent due to increasing signs of stress in the global energy markets.

2. PBoC pledges steady monetary policy as economy shows signs of stress

China’s central bank said it will keep monetary policy ‘normal’ for as long as possible, against a backdrop of mounting speculation that it will have to ease it – possibly with a yuan devaluation – as a result of the ongoing problems in the country’s real estate and financial sectors.

On Tuesday, the PBoC injected 100 billion yuan net ($15 billion), into the money market to keep money market rates capped at 6.4xxx and stabilize the exchange rate at 6.4xxx.

In addition to a growing energy scarcity, utilities from many countries are opting for lower power generation over paying skyrocketing prices for natural gas and coal. Goldman Sachs’ (NYSE: ) earlier cut its Chinese growth prediction for the year. According to data for August, industrial profit growth slowed again in year-on–year terms.

3 Stocks set to open lower on bond nerves

U.S. stock markets are set to open lower again later, with technology stocks set to give up more of this year’s outperformance as value trades come back into fashion.

The Fed ending quantitative easing is expected to raise bond yields. As a result, stock market valuations have to reflect a rising discount rate. This will reduce the future cash flows of tech companies still in low-profit growth phases.

By 6:45 AM ET (1045 GMT), were down 1.5%, while were down 0.8%. they were marginally outperforming with an increase of 119 points (or 0.3%)

Stocks likely to be in focus later include Ford, which announced its first all-new U.S. assembly plant in decades on Monday as part of its pivot to electric vehicles, and vaccine makers, after French giant Sanofi (NASDAQ:) abandoned its efforts to create an mRNA-based Covid-19 vaccine. 

Today’s most important data release is the August House Prices.

4. European energy prices hit new record as ECB refuses to panic

European gas, power and carbon prices all hit fresh all-time highs, with no sign of immediate relief in sight as the continent enters the start of the winter heating season.

Not by accident, shares in Russian gas giant Gazprom – the only company capable of meaningfully increasing gas shipments to Europe in the short term – rose to a 13-year high, just below the top of their 2008 spike.

The European Central Bank’s annual research meeting kicked off earlier, with Bank of France Governor Francois Villeroy de Galhau repeating that inflation is likely to be back below the ECB’s target of 2% by 2023.  ECB President Christine Lagarde’s speech later will be scanned for any sign that the surge in energy prices is changing that assumption.

People were not able to remain calm or carry on in the U.K. as panic buying fuel disrupted daily lives. Boris Johnson, the Prime Minister is about to dispatch military officers to the fuel-tanker industry.

5. Oil prices reach $80 API data, OPEC report due. 

Concern about low global inventories combined with an increase in demand due to the lifting of Covid-19 restrictions led prices to breach $80 per barrel.

Lufthansa reported that demand for transatlantic flights has increased more than three times since the U.S. eased its restrictions on European arrivals. Japan, however, said it will remove the current state of emergency from a few prefectures as a result of a dramatic drop in Covid-19 case numbers. Taiwan said that some restrictions will be lifted.

The American Petroleum Institute will provide U.S. inventory data at 4:30 pm ET as per usual. Last week saw stockpiles fall to a record three year low. The Gulf of Mexico’s energy complex is still not in the best position to boost output following two devastating hurricanes. 

OPEC will release its monthly market report.