📆 Tuesday, December 10
► European markets dipped, snapping potentially an eight-day winning streak, as optimism from China’s latest stimulus announcements faded. The Stoxx Europe 600 index is trading lower (-0.3%), with miners and luxury goods makers leading the decline. French luxury stocks that are China sensitive lead also the CAC lower (Kering -2%; Louis Vuitton -1.9%, Hermes -1.0%). Germany’s inflation rose to 2.2% in November, in line with expectations, while France’s CAC 40 and the UK’s FTSE 100 also slid as traders awaited US CPI data and the ECB's policy decision later this week.
► In the US, equity markets retreated on Monday, with the S&P 500 and Nasdaq pulling back from record highs. We see Wall Street in pre-market trading little changed. Nvidia shares fell yesterday as China opened an anti-monopoly probe into the company’s past acquisition, weighing on the broader tech sector. Weighing on sentiment – especially in the software segment – Oracle Corp. fell more than 8% after second-quarter results underwhelmed. Investors remain cautious ahead of Wednesday’s consumer price index (CPI) report, which will provide critical insights for the Federal Reserve’s monetary policy. Any signs of stalled progress on inflation could temper hopes of a third consecutive rate cut. Investment banks remain optimistic: HSBC and forecast a 10% increase in the S&P 500 for 2025, driven by earnings growth. Treasury yields have barely budged, with the 10-year bond yielding 4.22%, a sign that US investors remain cautiously optimistic overall.
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