Risk sentiment stayed mildly positive early Thursday after Nvidia’s historically strong earnings eased market fears and boosted global mood, supported further by positive trade headlines and reports that the U.S. is secretly preparing a Ukraine-war peace plan.
Upbeat but outdated U.S. data had little impact, while hawkish Federal Open Market Committee (FOMC) Minutes lowered expectations for a December Federal Reserve (Fed) rate cut and lifted the U.S. Dollar.
The Bureau of Labor Statistics (BLS) added uncertainty by cancelling the October jobs report and delaying the November release to December 16—after the December FOMC meeting—pressuring sentiment ahead of today’s U.S. September employment data.
The U.S. trade deficit for August, released unusually late in mid-November at –$59.6 billion versus –$61.0 billion expected, generated no market reaction, but the BLS delays strengthened the U.S. Dollar as traders assumed the Fed would avoid cutting without fresh labor-market data.
The latest FOMC Minutes showed a cautious, divided committee. Many participants judged it appropriate to keep rates unchanged for the rest of the year, though most still expect gradual cuts over time to reach a neutral stance. Some policymakers said a December cut could be warranted if economic conditions meet expectations, while others preferred no move. The Minutes flagged rising downside risks to employment, slowing job gains, and still “somewhat elevated” inflation with tariff-related upside risks that could lift core goods inflation in 2025–26.
In China, authorities are considering new stimulus to stabilise the weakening property market, including nationwide mortgage subsidies, larger tax rebates, and lower transaction costs, lifting real-estate shares. The People’s Bank of China (PBoC) kept the one-year and five-year loan prime rates unchanged at 3.0% and 3.5% for the sixth month, reflecting weak credit demand and ongoing property pressure, but also policymakers’ desire for stability.
U.S. media reported that Donald Trump quietly approved a Ukraine-Russia peace plan earlier this week, following an Axios report that the U.S. is secretly drafting a new plan. This coincided with an unannounced visit to Ukraine by Army Secretary Driscoll and Chief of Staff General George, a drop in oil prices on peace speculation, and reports that the proposal involves Ukraine surrendering Donbas and halving its armed forces. Major obstacles persist, including territorial concessions and Russia’s acceptance.
EURUSD fell to new session lows as Eurozone inflation matched forecasts and the U.S. Dollar stayed firm.
GBPUSD extended losses after UK Consumer Price Index (CPI) data, which broadly matched expectations, though the services CPI was softer. Market pricing barely shifted, with December rate-cut expectations rising from 80% to 85% and total expected easing by 2026 inching from 59 to 63 basis points.
UK consumer confidence saw its largest decline since April, with British Retail Consortium (BRC) and Opinium reporting economic expectations falling to –44% from –35% and personal-finance expectations slipping to –16% from –11%.
USDJPY rose further above a key swing area. Japan Chief Cabinet Secretary Kihara warned that yen moves have been sharp and one-sided, joined by Finance Minister Satsuki Katayama and Bank of Japan (BOJ) Governor Kazuo Ueda, who signalled heightened vigilance. BOJ board member Toyoaki Koeda, who joined on March 26 and has voted to hold at all five meetings since, delivered a hawkish call for continued policy normalization and further rate increases to avoid distortions, yet the yen still fell toward 157.40.
A Reuters poll showed a narrow majority expecting the BOJ to raise rates to 0.75% in December, with all forecasters expecting at least that level by the end of Q1.
Persistent yen weakness, imported inflation, and firm wage growth support the case, while Dai-ichi Life Research Institute chief economist Koichi Fujishiro warned the yen could slide to 160 per dollar even with more BOJ tightening.
In Australia, the International Monetary Fund (IMF) called for major tax reform—including a mining tax, higher Goods and Services Tax (GST), and fewer exemptions—alongside spending restraint and improved national fiscal coordination, while still expecting modest growth.
The Australian Prudential Regulation Authority (APRA) warned banks against loosening mortgage standards amid rising competition and high household debt. Reserve Bank of Australia (RBA) Assistant Governor Sarah Hunter stressed that monthly inflation is too volatile to interpret alone and said recent surprises complicate the case for further easing under the current 3.6% cash rate.
Wall Street closed with mild gains, while U.S. bond yields turned modestly higher after earlier declines.
Crude oil fell sharply on reports that Washington is brokering a Ukraine-Russia peace deal. U.S. Energy Information Administration (EIA) crude inventories fell –3,426K versus –603K expected; despite the supportive headline, underlying details were weaker. WTI also fell after Russian oil companies said sanctions have not hurt exports.
The U.S. Dollar Index (DXY) hit a two-week high, gold edged higher on safe-haven demand, EURUSD and GBPUSD fell for a fifth straight day, USDJPY extended a five-day rally to its highest level since mid-January, AUDUSD steadied after a one-month low, and NZDUSD bounced after hitting its lowest since early April. USDCAD inched higher after its strongest six-week rise, aided by the crude oil selloff. Bitcoin (BTC) and Ethereum (ETH) hit new six- and four-month lows before stabilising ahead of the key U.S. employment report.
EURUSD has fallen for a fifth straight day to a two-week low as the broadly firmer U.S. Dollar combines with growing monetary-policy divergence between the European Central Bank (ECB) and the Federal Reserve (Fed). The Euro is also pressured by rising geopolitical and trade tensions and a cautious market mood ahead of today’s preliminary November Eurozone Consumer Confidence data and the U.S. September employment report.
GBPUSD has extended its five-day losing streak, pausing near a two-week low as weak UK inflation and consumer-confidence data, a hawkish Federal Reserve (Fed) tone, and caution ahead of today’s U.S. jobs report and the November 26 UK budget keep pressure on the pair.
Meanwhile, USDJPY continues to climb to its highest level since mid-January, failing to respond to speculation about Japanese intervention or a potential Bank of Japan (BoJ) rate hike. The yen’s weakness reflects rising expectations of additional stimulus under the new Prime Minister and growing doubts over the BoJ’s ability to advance rate hikes.
AUDUSD remains under pressure at its lowest level in five weeks, weighed down by IMF warnings, concerns about potential tax changes, mixed Reserve Bank of Australia (RBA) commentary, and ongoing hawkish Federal Reserve (Fed) sentiment. NZDUSD is also holding steady after touching its lowest level since April, pressured by downbeat New Zealand news and mixed market mood. USDCAD, meanwhile, is heading for a weekly loss after a soft week, as weaker crude oil, Canada’s key export, combines with mixed signals on U.S.-Canada trade relations and Bank of Canada (BoC) expectations.
Speculation over a potential Ukraine peace deal, combined with fears of weaker energy demand driven by hawkish Federal Reserve (Fed) expectations, outweighed higher-than-expected U.S. weekly crude oil inventories and pushed crude oil sharply lower, marking its biggest daily drop in a week.
Gold, meanwhile, edged higher on mixed sentiment but has retreated today as a firmer U.S. Dollar and cautious optimism ahead of the U.S. employment report temper demand.
The firmer U.S. Dollar and a cautious market mood dragged Bitcoin (BTC) and Ethereum (ETH) to fresh six-and-a-half-month and four-month lows, respectively, despite positive industry developments, including optimism around an XRP ETF and progress on the U.S. Market Structure Bill.
In equities, the Dow rose 0.10%, the S&P 500 gained 0.30%, and the NASDAQ climbed 0.59%.
Nvidia delivered one of its strongest quarters ever, raised its outlook, and projected $500 billion in chip demand through 2026, reinforcing its dominance and the strength of the global AI-capex cycle despite China-related restrictions.
Google’s Gemini 3 surged to the top of AI benchmarks, boosting Alphabet’s stock.
Meanwhile, the White House urged Congress to reject tighter controls on advanced AI-chip exports to China and other foreign buyers, and Donald Trump is considering an executive order creating a federal “AI Litigation Task Force” to challenge state-level AI regulations.
The U.S. Commerce Department also plans to approve the sale of up to 70,000 advanced AI chips to companies in the United Arab Emirates and Saudi Arabia with strict China safeguards, while Washington is reassessing the timing of semiconductor tariffs to avoid consumer-price increases and a potential clash with China, according to Reuters.
Thursday promises to be another eventful day with key data releases, including the highly anticipated U.S. jobs report for September, alongside mid-tier economic reports from Canada and Europe. The market will also be closely watching the initial reaction to Nvidia's impressive Q3 results and Walmart's upcoming earnings, both of which are likely to attract significant attention from momentum traders.
As hawkish Federal Reserve expectations continue to gain traction, with no major economic releases ahead of the December FOMC meeting (aside from today's U.S. non-farm payrolls), the U.S. Dollar could continue its recent upward trend. This could put additional pressure on risk assets like equities and cryptocurrencies. Meanwhile, gold might see modest gains as investors turn to it for its safe-haven appeal amid market uncertainty.
The tech sector, particularly stocks like Nvidia, may experience a boost following the company's strong earnings report, reinforcing the strength of the AI-capital expenditure cycle. However, with the USD strengthening, risk assets will likely remain under pressure, and caution will be key for traders as they navigate through this busy data week.
May the trading luck be with you!
