Wall Street overview
US equities closed higher on Tuesday, supported by gains in technology, industrials, and communication services sectors amid lighter-than-usual trading volumes.
Key market performance
The Nasdaq Composite climbed 0.6%, the Dow Jones Industrial Average added 0.4%, and the S&P 500 rose 0.3%. Technology stocks led the rally, boosted by upbeat earnings from mid-cap names such as MongoDB and Credo Technologies. Boeing surged nearly 10% after signalling stronger aircraft deliveries and improved free cash flow prospects for 2026.
Cryptocurrencies also contributed to risk-on sentiment, with Bitcoin jumping 6% and Ether gaining 7.3%. Bond markets were steady, with the US 10-year Treasury yield closing near 4.1%, while the 2-year yield ended around 3.51%.
Economic outlook and Fed policy
Investors are looking ahead to a busy week featuring the ADP employment report, ISM Services PMI, and delayed PCE inflation figures.
Key drivers of sentiment
Markets continue to price in a strong likelihood of a 25 basis point Federal Reserve rate cut at the upcoming 10 December meeting. Elsewhere, Asian markets were little changed, and European equities were mixed after eurozone inflation rose 2.2% year-on-year, slightly above expectations.
Sentiment was supported by stronger US consumer indicators, including improved holiday season sales and a rise in the RealClearMarkets sentiment index, although inflation, tariffs, and high interest rates remain headwinds.
Asian market performance
Here’s how major Asian indices performed during the latest session:
Regional highlights
- Japan’s Nikkei gained 1.13% on tech and real estate strength, while the Topix edged lower.
- South Korea’s Kospi advanced 1.06%, supported by revised Q3 GDP growth of 1.8% year-on-year.
- Australia’s S&P/ASX 200 rose slightly despite Q3 GDP missing estimates.
- Hong Kong’s Hang Seng opened lower, and China’s CSI 300 remained flat.
US futures and corporate moves
US equity futures held steady on Wednesday as investor sentiment was lifted by a Bitcoin rebound and year-end rally prospects.
After-hours trading highlights
- Marvell Technology rose nearly 10% on strong Q3 results.
- American Eagle Outfitters surged 10% on robust holiday sales expectations.
Markets are also awaiting the ADP employment report for November.
European equities
European markets posted gains, led by banks and select corporates:
Key movers
- STOXX 50 rose 0.5% to 5,690, while STOXX 600 edged up to 576.
- Banks led gains, with BNP Paribas and ING higher. Santander climbed 1.5% after selling a Polish subsidiary.
- Bayer surged over 12% following a US Supreme Court decision on Roundup-related lawsuits, despite eurozone inflation reaching 2.2%.
Currency and commodities
Currency markets and commodities saw notable shifts amid global macro developments:
Market updates
The US dollar weakened on Wednesday, with the Dollar Index near 99.2 and the euro trading around 1.1637, as expectations of further Fed rate cuts weighed on the currency. Risk-on sentiment from equities and cryptocurrencies added pressure. Oil prices slipped in Asian trading:
- Brent down 0.3% to $62.24
- WTI fell 0.3% to $58.44
Markets weighed inconclusive US-Russia talks on Ukraine, ongoing Ukrainian attacks on Russian energy infrastructure, and a 2.48 million-barrel draw in US crude stocks, keeping geopolitical and supply concerns in focus ahead of official EIA data.
China’s services sector
China’s services sector grew at its slowest pace in five months in November, with the Services PMI slipping to 52.1.
Key trends
New orders softened, employment fell for the fourth month, and cost pressures persisted, though export demand improved slightly. Overall business confidence and output growth eased, reflecting continued economic slowdown and muted domestic momentum.
US consumer spending
US consumers spent a record $44.2 billion online over Thanksgiving weekend, including $14.25 billion on Cyber Monday, according to Adobe Analytics.
Spending patterns
Shoppers averaged $337.86 each. In-store visits rose 3%, and major retailers like Amazon, Walmart, and Target offered strong discounts. Many used AI tools to compare prices and make informed holiday purchases.
Equities on the move
Several companies saw notable share price moves driven by earnings, analyst ratings, and strategic updates:
Company highlights
- CrowdStrike: Forecast Q4 revenue of $1.29-1.30 billion, above estimates. Raised full-year outlook to $4.80-4.81 billion. Shares rose 3% in after-hours trading.
- Marvell Technology: Announced acquisition of Celestial AI for $3.25 billion in cash and shares. Shares jumped over 8% after hours.
- Boeing: CFO confirmed recovery plans and stronger deliveries for 2026. Positive free cash flow expected next year.
- Amazon Web Services: Introduced Trainium3 servers, Nova Forge for AI model creation, and launched Nova AI models. Adopted Nvidia NVLink Fusion for enhanced AI infrastructure.
- Bilfinger: Raised mid-term financial targets, aiming for 8-10% revenue CAGR through 2030, with 4-6% organic growth and an EBITA margin of 8-9%. Free cash-flow conversion expected above 90%. Revenue forecast €6.9 billion organically by 2030, rising to €8.3 billion including acquisitions.
- Morgan Stanley: Downgraded Vinci to Equal-weight, citing slowing growth at Vinci Energies, Cobra IS, and Airports, muted earnings momentum, and constrained free cash flow.
- Barclays: Initiated coverage of Cloudflare with an Overweight rating and a $235 target, citing strong growth drivers and margin potential.
- KeyBanc: Upgraded T-Mobile to Sector Weight, expecting organic EBITDA growth above 7% in 2026-2027 despite structural challenges.
Banking and currency outlook
The Bank of England cut its Tier 1 capital requirement from 14% to 13%, its first reduction since 2008, aiming to boost lending.
Analyst forecasts
BofA forecasts further US dollar weakness in 2026 due to dovish Fed policy and fiscal pressures. JPMorgan expects European banks to outperform into 2026, citing strong capital generation and attractive valuations.
Upcoming data and events
Today’s key US releases include:
Economic calendar
ADP employment change for November, ISM Services PMI, import/export prices, and EIA crude and product stock data. Major earnings reports include Salesforce, Snowflake, Dollar Tree, and Inditex.
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