Global stocks opened the week on a strong note on Monday as rising expectations of a U.S. Federal Reserve rate cut in December boosted investor confidence, even though policymakers remain divided over the decision.
The week began with several market-moving events in focus, including the upcoming U.S. retail sales and producer price index (PPI) data, while the UK awaits the long-anticipated budget presentation by Finance Minister Rachel Reeves.
With Japan closed for a public holiday, trading volumes were lighter; however, the momentum across Asian markets remained positive. The MSCI Asia-Pacific Index (excluding Japan) rose 0.4%, while South Korea’s Kospi gained 0.7%.
U.S. futures climbed as well, with Nasdaq futures up 0.64% and S&P 500 futures rising 0.45%. Europe’s EUROSTOXX 50 futures also advanced 0.78%.
Market projections now indicate a 57% probability of a 25-basis-point rate cut next month—an increase from less than 30% just a week earlier.
Meanwhile, currency markets centred on the yen, which slipped 0.2% to ¥156.72 per dollar, hovering near a 10-month low.
Investor sentiment received an additional boost after New York Fed President John Williams stated that there is still “room for further adjustment” at the December policy meeting, raising the odds of a rate cut to nearly 70%.
Across Asia, most markets trended upward, recovering from last week’s turbulence triggered by fears of a possible tech bubble. The rapid surge in AI-linked stocks—propelling giants like Nvidia to unprecedented valuation milestones—has raised concerns among analysts about an overheated sector.
Focus this week has shifted to the PPI report, one of the last significant data releases before the Federal Reserve meeting, especially as October’s key inflation report was delayed due to the U.S. government shutdown.
According to market analyst Fabien Yip, a stronger-than-expected PPI figure could signal persistent inflationary pressure, possibly reducing the Fed’s ability to ease rates next month.
Early trading on Monday showed mixed results across Asia: Hong Kong and Seoul gained more than 1%, while Shanghai and Manila edged lower. Bitcoin, meanwhile, hovered around $87,000, still well below last month’s record high of $126,200.
Key Figures (as of 02:30 GMT)
- Hang Seng Index (Hong Kong): +1.4% at 25,568.08
- Shanghai Composite: −0.1% at 3,829.71
- Nikkei 225 (Tokyo): Closed for holiday
- Dollar/Yen: ¥156.70
- Euro/Dollar: $1.1515
- Pound/Dollar: $1.3096
- West Texas Intermediate: $57.93 (−0.2%)
- Brent Crude: $62.44 (−0.2%)
- Dow Jones (NY): 46,245.41 (+1.1%)
- FTSE 100 (London): 9,539.71 (+0.1%)
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