Stocks are poised for their worst week in seven months as concerns over lofty valuations and whether massive investments in artificial intelligence will pay off prompt investors to retreat from riskier assets. The MSCI All Country World Index has fallen almost 3% this week, putting it on track for its sharpest weekly drop since April 4, when President Donald Trump’s tariffs rattled markets. Asian shares slumped 1.6% on Friday — also heading for their weakest week since April — after Wall Street indexes retreated on Thursday. Adding to the cautious mood, cryptocurrencies dropped, with Bitcoin trading below $86,000. The Kospi Index — a poster child for AI exuberance — tumbled as much as 4.2% as volatility spiked on Wall Street and technology stocks took a beating. Sentiment appeared to stabilize with futures contracts indicating a gain for the S&P 500 index after the underlying gauge slipped to the weakest level since September. Treasuries also gave up some of their gains with the yield on the 10-year edging up one basis point to 4.09%. In Asia, the focus was on Japan, where Prime Minister Sanae Takaichi’s cabinet approved the largest round of extra spending since the pandemic. The yen held steady against the dollar after the stimulus plan, which includes ¥17.7 trillion ($112 billion) in general account spending. The sharp reversal in market sentiment came as lingering concerns over stretched valuations and heavy tech spending curbed a rally fueled by Nvidia’s upbeat forecast, with the AI bellwether’s shares sliding 3.2%. Adding to the unease was persistent uncertainty over the Federal Reserve’s ability to cut interest rates next month, as recent remarks from policymakers signaled caution about easing policy too soon. On Thursday, the S&P 500 benchmark logged its biggest intraday reversal — at 3.6% — since the height of the tariff turmoil in April, according to data compiled by Bloomberg. The gauge has now fallen 5% from its most recent peak. Goldman Sachs Group Inc. partner John Flood said that since 1957, there have been eight instances, including Thursday’s, in which the S&P 500 opened more than 1% higher only to reverse and close in the red. On the bright side, average performance after those episodes was positive, with a gain of at least 2.3% in the following day and week and a 4.7% advance in the next month. The Cboe Volatility Index rose to 26.42, the highest since April. The index didn’t close at a session high, which suggested “volatility fears are elevated, but not extreme,” said Chris Murphy, co-head of derivatives strategy at Susquehanna International Group, in a note late Thursday. The heightened swings came just ahead of Friday’s expiration of an estimated $3.1 trillion of notional options.
Thursday also brought the release of a long-delayed government employment report, which showed that US job growth picked up in September, while the unemployment rate ticked higher. The data suggested the labor market showed signs of stabilizing before the government shutdown. The figures come a day after minutes from the Fed’s last policy meeting showed a divided committee on whether to cut rates again.
Fed Governor Michael Barr said the US central bank needs to proceed with caution in considering additional rate cuts with inflation still running above the target. Fed Bank of Cleveland President Beth Hammack said lowering rates to support the labor market could extend the period of above-target inflation and increase financial stability risks. Her Chicago counterpart Austan Goolsbee signaled that he’s still apprehensive about delivering another rate cut at the central bank’s December meeting. “Investor concerns over valuations coupled with a mixed employment report dominated sentiment in the session,” Nick Twidale, chief market analyst at AT Global Markets in Sydney, said about the US trading day. “It does now feel that we are in a ‘sell rallies’ environment at the moment and the top is in for the rest of the year.” In commodities, oil was on track for a weekly loss of more than 2%, with Brent trading below $63 a barrel. Crude’s leg lower came as Ukrainian President Volodymyr Zelenskiy agreed to work on a peace plan, just as US sanctions on two Russian oil giants are scheduled to take effect on Friday. US After Hours GAP +4.9%, INTU +3.2%, ROST +2.8% higher on earnings; C +0.3% realigns segments, new CFO; ESTC -11.9% lower on earnings.
Nikkei -2.40% Hang Seng -1.76% CSI -2.09% Shanghai -2.10% Shenzen -2.99%
Eur$ 1.1539 CNH 7.1144 CNY 7.1124 JPY 157.18 GBP 1.3089 CHF 0.8044 RUB 79.9019 TRY 42.4431 WTI$ 58.11 -1.51% Gold 4,050 -0.64% BTC 85.345 -2.14% ETH 2,783 -3.20% SOL 130.79 -2.45%
S&P +0.30% Nasdaq +0.18% EuroStoxx -1.40% FTSE -1.02% Dax -1.37% SMI -0.84%
Macro :
- Airlines Holiday Bookings Hurt by Shutdown, Hassett Says
- Michael Saylor’s Strategy Risks Losing Billions in Index Flows
- Taiwan’s Wu Says US Won’t Put ‘Punishing’ Tariffs on Chips: FT
- Goldman’s Flood Sees ‘Extreme’ Focus on Hedging Driving Selloff
- Brussels set to issue formal warning to Italy over ‘golden power’ rules
Keep an eye on :
Keep an eye on :
- ACKB BB : Ackermans Maintains FY Net Income Forecast
- ALTR PL : Altri 9M Net Income EU12.4M Vs. EU89.6M Y/y
- ASC LN : Asos FY Revenue Misses Estimates
- BAB LN : Babcock 1H Adjusted Revenue Meets Estimates
- BEKB BB : Bekaert Sees FY Sales About EU3.7B, Est. EU3.74B
- EN FP : French Telcos Mull Wider Bid for Billionaire Drahi’s Assets: FT
- CARLB DC : Carlsberg Agrees New Power Purchase Agreements Across Nordics
- CAMB SS : Norion Bank Offers to Buy Consensus Asset Management
- EVD GY : CTS Eventim 3Q Normalized Ebitda Beats Estimates, CTS Eventim Beats as Live Entertainment Improves, Analysts Say
- CAN LN : Canal+ Secures Renewal of Exclusive Coverage Rights for UEFA Club Competitions
- 1 HK : Conglomerate CK Hutchison Weighs Dual Listing of Health & Beauty Retail Giant
- CVC NA : Asurion Is Said to Near Deal for CVC-Backed Domestic & General
- CVC NA : Asurion Is Said to Near Deal for CVC-Backed Domestic & General
- EQT SS : EQT Said to Near €2 Billion Deal to Buy Desotec from Blackstone
- ESTC US : Elastic 3Q Revenue Forecast Beats Estimates
- EXENS FP : France’s AMF Exempts HLD, IPHG From Making Exosens Offer
- FRAS LN : Frasers Group Buys Braehead Shopping Centre in Glasgow; No Terms
- GAP US : Gap Sales Beat Estimates on Celebrities, Collaborations, Gap Climbs on Strong Old Navy, Banana Republic Performance
- GOOGL US : Robotics Startup Physical Intelligence Valued at $5.6 Billion
- GSK LN : GSK Subsidiary Tesaro Initiates Litigation Against Anaptysbio
- INTC US : Intel CEO Dismisses Concerns About New Hire Bringing TSMC’s Tech
- INVP LN : Investec S.Africa Seeks More Speed in Public-Pvt Infrastructure
- JUVE IM : Italian Football Club Juventus Seeks Fresh Funds with Share Sale
- KINVB SS : Kinnevik Parts Ways With CEO Amid Lackluster Portfolio Returns
- MSTR US : Michael Saylor’s Strategy Risks Losing Billions in Index Flows
- NORION SS : Norion Bank Offers to Buy Consensus Asset Management
- NVDA US : Taiwan Approves Nvidia’s NT$1b Investment in Office Building
- ORA FP : French Telcos Mull Wider Bid for Billionaire Drahi’s Assets: FT
- RYA ID : Ryanair Pledges Investment in France If Government Scraps Tax
- STLA US : Stellantis to Assemble Cars from China’s Leapmotor in Brazil
- TKTT FP : Tarkett Participation Buyout Offer for Tarkett to Reopen: AMF
- TEF SM : TelefóNica Gets Exclusive Media Rights of UEFA Champions League
- VIE FP : Veolia Agrees to Buy US Firm Clean Earth for $3b EV From Enviri