A Preview of the Day in European and Global Markets by Stella
Asian trading remained muted as investors eagerly awaited the earnings report from Nvidia, the AI powerhouse and the world’s most valuable company with a staggering market cap of $3.6 trillion.
With Nvidia shares already climbing 5% overnight, expectations are sky-high. Options trading suggests a potential $300 billion fluctuation in market value, promising a volatile trading session ahead.
Asian markets presented a mixed picture, with Japan lagging behind, slipping 0.4%. Meanwhile, Wall Street futures held steady, and European stock futures indicated a quiet start for the region’s markets.
Geopolitical tensions weighed on sentiment after Ukraine used U.S. missiles to strike Russia, prompting Russia to lower the threshold for a possible nuclear response. However, those fears have somewhat eased.
In the crypto world, Bitcoin surged past $94,000 for the first time, buoyed by optimism that U.S. President-elect Donald Trump’s administration will adopt a crypto-friendly stance. Trump’s pick for Treasury Secretary remains unannounced but could be revealed as early as Wednesday.
Before the spotlight shifts to Nvidia, markets will focus on the release of British inflation data for October. Any unexpected increase could reinforce concerns that the recent global disinflationary trend may be losing momentum.
In Canada, inflation has climbed back above 2%, prompting investors to reassess the likelihood of a significant half-point rate cut by the Bank of Canada in December. Meanwhile, uncertainty lingers over whether the Federal Reserve will proceed with a 25-basis-point rate cut next month.
Economists predict Britain’s core CPI will increase by 0.3% month-on-month, raising the annual rate to 3.1% from September’s 2.9%. Headline inflation is also expected to climb to 2.2%, up from the previous 1.9%.
For the Bank of England, markets anticipate a measured pace of monetary easing, with projections of one rate cut per quarter, following Chancellor Rachel Reeves’ expansive budget.
On the global stage, several central bank figures are scheduled to speak later today, including Federal Reserve Governors Lisa Cook and Michelle Bowman, Fed Boston President Susan Collins, and European Central Bank President Christine Lagarde. These appearances will be closely watched for insights into the divergent paths of interest rates in Europe and the U.S.
