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European stocks remain steady as traders await U.S. inflation figures
The dollar was stable and oil prices were down as traders waited to see U.S. data on inflation. Wall Street had Close higher On Thursday, sentiments were boosted by the White House's confirmation that U.S. president Donald Trump will be attending. Xi Jinping, the Chinese president, will be visiting Asia next week. The meeting was seen as an indication of the slight easing of tensions between China and the U.S. before a deadline of November 1, for additional U.S. duties on Chinese imports. The Shanghai Composite Index in China rose by 0.4% to its highest level since August 2015. European markets opened higher but then became mixed and lost direction. The pan-European STOXX 600 index was up by 0.1% at 0850 GMT. It is on course to gain a week. London's FTSE 100 also showed little change. The MSCI World Equity Index was up around 0.1%, resulting in a gain of 1.2% for the entire week. The U.S. Stock Markets have surged in this year and reached record highs, as traders pour money into artificial intelligence Bet that the U.S. Federal Reserve continues to reduce rates. Investors waited for U.S. Inflation data on Friday. The data was delayed because of the Government shutdown . It is expected that the Consumer Price Index report (CPI), which will be released later in this session, will show core inflation at 3.1% for September. Next week, the Fed is expected cut rates by 25 basis points. Peter Fitzgerald, Chief Investment Officer for Macro at Aviva Investors, said: "It is a continuation in a generally supportive environment for equity markets where interest rates have been broadly falling across developed markets with Japan being the notable exception. Volatility has begun to drop again after a short spike, and there are no major earnings surprises." He said that it was impossible to know when or where a bull run would end. Large technology companies. TRUMP CANCELS CANADA TRADE NEGOTIATIONS The dollar index rose to 99.045 on Monday, an increase of around 0.1%. Canadian dollar Trump's impact was limited Saying on Social Media He said that he would end all trade negotiations with Canada over what he called a fraudulent advertisement Ronald Reagan, the late former president, speaks negatively about tariffs. As the new Prime Minister of Japan promised economic stimulus, the yen fell. The dollar-yen pair was at 152.97. The dollar was stable at $1.1611. The euro zone's business activity grew more rapidly than expected in October. Data shown . Euro zone government Bond yields are rising After the data, Germany's Bund yields hit 2.612%. Oil prices After the U.S. sanctions on major Russian oil companies,, which had gained 5%, slowed down, but they were still on course for a weekly increase. Gold fell around 1.5% per day to $4,064.26 an ounce. It is on course for a weekly decline, ending its nine week winning streak. Gold funds received their The largest weekly inflow Bank of America Global Research reported that the number of people who died in the past week was up from Wednesday. Apple and Microsoft are among the five "Magnificent 7" U.S. firms at the heart of the artificial-intelligence boom that will report their earnings next week. Intel's earnings will be announced on Thursday beat expectations
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Take Five: Make or Break
The week will be dominated by renewed trade tensions, talks between Washington and Beijing, and decisions made by the central banks of the United States, Canada, and Europe. Meanwhile, Argentina's voters go to the polls. Dhara Ranasinghe, Alden B. Bentley, Lewis Krauskopf, and Rodrigo Campos in New York and Kevin Buckland, in Tokyo, give you all the information about what to expect in world markets this week. 1/ A MIDTERM DRAMA The mid-term elections in Argentina on Sunday will be a crucial moment for the biggest reform story of emerging markets. Right-wing president Javier Milei wants to consolidate his minority position following his economic reform program that has crushed inflation and strengthened ties with Washington, which have produced some of the best returns in emerging markets since he assumed office in December 2023. But despite the unprecedented support of U.S. president Donald Trump, which includes direct intervention in the FX market, a central bank swap line worth $20 billion and the prospect for another $20 billion loan, the peso has continued to fall to record lows. All of this could be swept away if Milei has a poor result. This would also hinder reforms and raise questions for investors about how they should shape their long-term investments in the country. IT'S AI, STUPID The earnings of megacap tech companies and growth companies are the highlight of a week full of corporate results in the United States that may shed light on how the "AI trade" is doing. Microsoft, Apple Alphabet Amazon Meta Platforms and Amazon are all part of the "Magnificent 7" megacaps that dominate equity indices. In the next week, one-third of S&P500 constituents will report, including oil giants Exxon, Chevron, and Visa and Mastercard. Investors will also examine data to determine the cost and impact of a shift in U.S. Trade Policy. According to LSEG data, S&P 500 companies have reported a 9.2% increase in Q3 earnings compared to the previous year. A greater than usual number of companies has exceeded profit expectations so far. 3/COUNTING on a CUT The markets are almost certain that the U.S. Federal Reserve is going to cut interest rates a quarter point when they conclude their meeting on Wednesday. They are also confident about another reduction in December. This year-end cut could be less obvious if the shutdown continues, as data-driven policymakers will have no official economic indicators. Trump will meet with Chinese President Xi Jinping Thursday, as part of a visit to Asia on the sidelines the Asia-Pacific Economic Cooperation CEO Summit. The long-awaited meeting was put into doubt after escalating trade tensions. It's not all about the FED. That's correct, the Bank of Canada will also cut rates on Wednesday, despite Trump's announcement to end trade talks. The European Central Bank will end its meeting on Thursday. It appears to be in a "nothing-to-see" mode. A poll of economists predicts that it will likely leave rates at 2% for the third consecutive meeting and remain on pause until the end the year. The downside risks of the economy are causing traders to predict a 65% chance that a quarter point cut will be made by mid-2026. However, headwinds are on the horizon. Aside from the trade tensions, France is also experiencing political turmoil and there will be an election on Wednesday in The Netherlands that is dominated by populist currents. Christine Lagarde, the ECB's chief, may be asked if the bloc is still in a good place. 5/HIKE HOLDED? Bank of Japan will likely hold off on a rate increase next Thursday, opting instead for a hike in December or early January. This is not because of pressure from Japan's new dovish premier. Sanae Takaichi - the new fiscal and monetary dove who was appointed to the top position on Tuesday - is expected to not delay the tightening of monetary policy, according two-thirds polled. However, her often-repeated belief that the central banks should align with government policies has been echoed by many analysts. Analysts and traders instead point to BOJ governor Kazuo Ueda’s consistently cautious tone. This is especially true on the potential fallout from tariffs, despite his board making a conspicuously aggressive pivot last month. Most analysts are looking at a December increase as soon as possible, based on his desire to have more data. This includes U.S. holiday shopping trends.
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Sources: Japan's Q4 aluminium price is $86 per ton, a 20% drop from Q3.
Five sources involved directly in the price negotiations said that the premium for aluminium shipments for Japanese buyers from October to December has been set at $86 per ton. This is down 20% on the previous quarter due to weak demand. This is a lower figure than the $108 paid per ton in the quarter July-September and marks the third consecutive decline. Japan is the largest Asian importer for premiums and light metals For primary metal shipments, it agrees to each quarter pay over the London Metal Exchange cash price that is the benchmark for the area. Early in September, pricing talks were held between Japanese aluminium purchasers and global producers like Rio Tinto and South32. They were to be concluded by the end the month. They lasted longer than normal as both sides tried to close the gap. The producers initially offered premiums between $98 and $103 per ton, down from the previous quarter by 5% to 9%. A producer cut its price to $97 but buyers wanted levels in the 80s citing premiums of $70s. A source from a Japanese fabricator revealed that producers eventually agreed to $86 this past week and that buyers accepted it, despite their bids remaining in the low-$80s. The source added that high inventories kept prices in the 80s. Three major Japanese ports have large stocks of aluminium According to Marubeni, the trading house, the total volume of coal sold in September was 341,300 tonnes, an increase of 1.8% over the previous month. A producer source stated that "we cut offers to reflect the slow demand and to meet buyers' voice," noting that sellers had held out until last week for higher prices, as it was expected that rising premiums in Europe and the United States would tighten supply in Asia. Sources declined to identify themselves due to the sensitive nature of the issue. (Reporting and editing by Christian Schmollinger, Louise Heavens and Yuka Obayashi)
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On a sub-Antarctic Island, hundreds of seal pups likely died from bird flu
Authorities said that Australian scientists found hundreds of dead pup seals on Heard Island, in the subantarctic. The signs they had on their bodies suggested that the birds flu virus that has been sweeping the world was responsible for the deaths. Since 2021, the virulent strain H5N1 of bird flu has infected poultry farms, dairy farms, and some farmworkers. It has killed millions and affected wild bird populations. In a press release, the Australian agriculture department stated that "at this stage there is no confirmed detection". It added that samples of dead seals would be sent to Australia for testing. The ministry said that since the virus had already been detected on nearby French Kerguelen islands and Crozet Islands, it was not surprising to see symptoms of H5 bird influenza in wildlife on Heard Island. Australia is the only continent that has not been infected by the virus. The virus could spread further through Antarctica, increasing the risk from the south. Heard Island is the furthest south the influenza virus has spread in Antarctica since its arrival from South America, in 2023. It is home to large numbers of seabirds, penguins, and seals. The volcano, which rises from the ocean more than 4,000 kilometers (2,486 mile) southwest of Perth, and about 1,700 km (1.060 miles north of Antarctica), was formed by a 2,745 meter (9,006 foot) high mountain. Julie McInnes is an ecologist with the Australian Antarctic Division. She spent 10 days in Antarctica and found that animals were healthy until they came across hundreds of dead elephant pups. McInnes said that a large number of pups were in this section. Researchers will return to the island around the end of the year. It is not clear if the virus will spread. The Agriculture Ministry said that the confirmation of bird influenza would not increase the risk of spreading it to Australia. Australia is preparing for H5N1 bird influenza. It has tightened biosecurity on farms, tested shore birds for disease and vaccinated vulnerable species. Reporting by Peter Hobson, Canberra; Editing and production by Aurora Ellis and Clarence Fernandez
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Erdogan: Turkey's Erdogan claims that talks with Qatar and Oman about Eurofighter procurement are going well
Tayyip Erdoan said that he had held discussions on Turkey's plans to acquire Eurofighter Typhoon jet fighters from Qatar, Oman and the Gulf during a tour of the region. He added that these talks were going well. Reports on Wednesday said that Ankara has proposed ways to acquire advanced fighter jets to its European and American allies, amid discussions to purchase 40 Eurofighter Typhoons and U.S. F-16s or F-35s. This is happening as President Tayyip Erdoan makes a regional trip to Kuwait, Qatar, and Oman. According to a person with knowledge of the situation, under the deal that Britain is close to signing with Turkey on Typhoons the country would receive 12 of the aircraft, even if they were lightly used by previous buyers Qatar or Oman, in order for it meet its immediate requirements. Erdogan told reporters that Turkey is continuing talks on procurement with Qatar and Oman. The discussions included "many details", and were going in a positive direction. "We are working to complete these quickly and, God willing make our Air Force stronger. According to a transcription of his remarks shared by his office, he stated that the jets would make our Air Force much stronger. (Reporting and editing by Jonathan Spicer; Tuvan Gumrukcu)
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China's lithium prices reach a 2-month high due to falling inventories and improving demand
Analysts said that the price of lithium carbonate futures in China reached a two-month peak on Friday. This was due to falling inventories and improved demand from electric vehicles and energy storage sectors. The Guangzhou Futures Exchange's most active futures contract for lithium carbonate reached its highest level in 11 months at 80,880 Yuan ($11354.77) per metric ton, before paring the gains to close daytime trading 1.33% higher, at 79.520 Yuan. Shares of major producers such as Ganfeng Lithium, Tianqi Lithium, and others rose by 0.22 % and 1.25 % respectively, thanks to higher prices. The demand for battery materials was driven by the explosive growth of the electric vehicle sector. According to the statistics bureau of China, September's output of new energy vehicles rose 20.3% compared to a year ago. This is a nine-month record. China announced in September its plans to almost double its energy storage capacity. energy storage By 2027, the capacity will be 180 gigawatts. Analysts at GF Futures published a note Thursday predicting that the consumption of lithium carbonate will increase by 5% this October, after a 12% rise in September. According to consultancy Fubao, persistently falling inventories, which fell to their lowest level in July, 127.500 tons, on October 23 lent further support to the prices. Su Jinyi is an analyst at Fubao based in Wuxi. She said that "restocking by downstream consumers has increased since September. This has led to a continual drawdown of lithium stocks." Analysts and traders said that the Guangzhou Exchange's falling warrants, which are documents granting ownership of the shares, also contributed to the price increase. Wu Jiang is a Beijing analyst with broker SDIC Futures. He said, "It indicates that some cargoes are being pulled out of warehouses and this signals an improvement in demand on the spot market." Some analysts questioned the durability of the rally citing a persistent oversupply resulting from rapid capacity expansions and a slowing demand growth. $1 = 7.1230 Chinese Yuan (Reporting and editing by Thomas Derpinghaus; Additional reporting by Dylan Duan).
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Iron ore prices fall on declining Chinese demand
The price of iron ore futures fell on Friday after a three-session streak of gains, as the demand for steel in China, the world's largest consumer, slowed. The January contract for iron ore on China's Dalian Commodity Exchange closed daytime trading 0.58% lower, at 771 Yuan ($108.24), a metric tonne. This was a 0.1% drop in a week. At 0711 GMT on Monday, November benchmark iron ore at the Singapore Exchange had fallen 0.57% to $104.05 per ton. This represents a 0.1% increase so far in this week. Ying Cao is an analyst based in Beijing at SDIC Futures. She said that lower hot metal production, a measure of iron ore consumption, dragged prices down for the main steelmaking ingredient. The average daily hot metal production fell for the fourth consecutive week, by 0.4% compared to the previous week. It was the lowest level since September 5, at 2.4 millions tons as of October 23. Cao said that he expects hot metal production to continue to decline in the next few weeks, as higher coal prices have forced some mills into reducing output. Analysts at GF Futures reported that coke and other steelmaking components, such as coking coal, continued to gain, with gains of 1.42% and 1.53 percent, respectively. This was boosted by a falling supply due to the halting of mining operations at some coal production centers, they said. The price decline was limited by the hope that tensions between traders in the two world's largest economies would ease. He Lifeng, the Chinese Vice Premier, will meet with U.S. Treasury Sec. Scott Bessent as well as Trade Rep Jamieson Greer on Friday in an effort to calm down tensions ahead of a scheduled meeting between U.S. president Donald Trump and Chinese president Xi Jinping. The benchmark steel prices on the Shanghai Futures Exchange have been moving sideways. Rebar fell 0.75%; wire rod dropped 0.18%, while hot-rolled coil ticked up by 0.03%. Stainless steel rose 0.71%. ($1 = 7.1230 Chinese Yuan) (Reporting and editing by Amy Lv, Colleen Howe)
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ASIA GOLD - India demand drops after the festive rush, and price falls encourages buyers to buy elsewhere
This week, physical gold demand in India fell as buyers held off purchases in anticipation of a further price correction. Meanwhile, a drop in interest rates in China and Singapore prompted buyers to purchase. This week, Indian dealers quoted a premium. Up to $25 per ounce above official domestic prices. This includes 6% import duties and 3% sales taxes, which are unchanged from the previous week. On Friday, domestic gold prices traded at around 122.700 rupees for 10 grams after reaching a record high last week of 132.294 rupees. Gold spot prices are on course for their first weekly decline in 10 years. Last week, gold was being bought at any price. This week's price correction has caused them to be cautious. Some have even delayed purchases, hoping for a larger drop. Indians celebrated the Dhanteras (Diwali) and Diwali (Dhanteras) festivals over the past few days. These are occasions where buying gold is deemed auspicious, and they're also among the busiest days for gold purchases in the country. A Mumbai-based bullion seller with a private banking firm said that new import orders were now placed more cautiously, and in smaller quantities. The recent price correction will likely lower the import base price next week. The import duty is calculated using the base price of gold imported every two weeks. Bullion prices in China's top consumer ranged from discounts of up to $20 per ounce, or a premium as high as $8 over the global benchmark price. . Bernard Sin, Regional Director of Greater China for MKS PAMP, said that despite the sharp fluctuations in gold prices between $4,000 and $3,300/oz there was little evidence of traders selling their physical holdings. Investors continue to hold their positions amid macroeconomic uncertainties and falling real interest rates. Gold in Hong Kong In Singapore, the price was $2.20 higher than in Singapore. Gold traded at par prices with a premium of $2.50. "We've continued to see good demand. Especially this week, when prices dropped, we've had quite a few clients come to buy gold and silver, to take advantage of this opportunity to get into the market," said Brian Lan. In Japan, gold The price was $1 higher than the spot price.
Take Five: Low Visibility Ahead
Even though the U.S. Government is shut down, this has not stopped stocks from reaching new highs. They are confident that rate cuts that favor bulls will continue to keep momentum. One problem is that it's difficult to see what's happening with the economy. Here is your week ahead from Alden Bentley, Rocky Swift and Amanda Cooper, in London, and Alun, Dhara and Amanda Ranasinghe in New York.
1/ DOLLAR BEAR SHARPENS THEIR CLAWS
The dollar is in a good position to start the final quarter of 2025. After falling in the first two quarterly periods, due to criticism of U.S. exceptionalism, the dollar ended Q3 with an 1% increase against major competitors. The greenback is still down 10% this year, but its stabilisation has brought some calm to the nearly $10 trillion a day FX markets. The immediate threat to the independence of the Federal Reserve, a source of potential dollar stress, has abated. The weak labour market adds to Fed rate cut bets. Dollar bears are unlikely to hibernate long, especially if the U.S. shutdown continues. Experts in FX say that the yen is particularly attractive, while the euro may still reach $1.20, which it was so close to reaching last month.
2/ WHO NEEDS DATA? The U.S. data schedule for next week is light. This means that further market disruptions from the shutdown of the federal government should be minimal. Also, the U.S. Treasury Department will conduct a normal note and bond auction.
The market is likely to make due without the U.S. International Trade Report on Tuesday and Friday's preliminary University of Michigan October sentiment index.
Treasury will sell $58 billion in notes for three years on Tuesday, $39 Billion in 10-year notes on Wednesday, and $22 Billion in 30-year bonds Thursday. Bond market cannot yet calculate the fiscal impact of a furlough of federal employees indefinitely. Demand could be strong as long as the benchmark yield on 10-year bonds is above 4%.
The earnings parade for Wall Street's largest banks will begin the following week with the announcement of the third-quarter results by Delta Airlines, Levi Strauss and other companies.
3/ A SHOT IN THE ARROW Global pharmaceutical stocks that were in trouble have received a boost thanks to a deal struck between Pfizer, the U.S. and Medicaid in which the price of prescription drugs will be lowered in exchange for tariff reductions. U.S. president Donald Trump took aim at the industry over high U.S. drug prices, which sent shares of drugmakers to multi-decades lows. Investors now believe that the agreement, which is more benign, will lead to more deals.
The U.S. Healthcare stocks have gained 5.6% in the past week, their largest weekly gain since over three years. European healthcare stocks are up 7.6% and on track to their best week ever.
It's now time to wait and see if the deals come to fruition, and if they justify this optimism. The U.S. also imposed tariffs on imported kitchen cabinets, furniture and timber. Trump has said that he will impose a 100 percent tariff on all films made overseas which are sent to the U.S.
The oil industry is struggling to cope with the hefty global supply, which only seems to increase. Demand also does not seem to be able to keep up. According to the International Energy Agency, there may be a surplus of 3 million barrels a day by 2026 compared to an excess of 600,000. The OPEC+ Group, which includes OPEC, other exporters, including Russia, met at the weekend. It is expected that the group will accelerate its pace of unwinding production curbs imposed by the pandemic.
Around $65 per barrel, the price of crude oil is about half that it was in 2022 when Russia invaded Ukraine. Geopolitics will continue to be the wildcard for producers, consumers and forecasters alike.
5/ DIRECTION UNDER DOWN
It is almost certain that the Reserve Bank of New Zealand's rates will be cut next week. How much will the Reserve Bank of New Zealand cut rates?
In August, the RBNZ cut interest rates to a low of just 3%. This was the lowest rate in three years. Last month, data showed that New Zealand's second-quarter economy shrank by 0.9% due to uncertainty over tariffs and a weakening housing market. Money markets are fully pricing in a quarter point cut to 2.5% at the RBNZ meeting on October 8. However, the likelihood of a half-point drop has risen to 44.5% compared to about 25% one week ago. The RBNZ's policy divergence from the Reserve Bank of Australia which held rates at the same level in September could cause further weakness for the kiwi. It is already down three years against the Antipodean counterpart.
(source: Reuters)