Trade and inflation relief are driving world stock markets sharply higher on Monday, as we begin a packed week of big central bank meetings and heavyweight tech earnings.
I’ll get into all the market-moving news below.
Please also check out my column today in which I take a look at how increasingly fragmented global trade and politics could make the repatriation of global capital a key theme in the coming years.
TODAY’S MARKET MINUTE
* Top Chinese and U.S. economic officials on Sunday hashed out the framework of a trade deal for U.S. President Donald Trump and Chinese President Xi Jinping to decide on later this week that would pause steeper American tariffs and Chinese rare earths export controls, U.S. officials said.
* Argentine President Javier Milei’s party cruised to victory in midterm legislative elections as voters handed him a mandate to keep pushing through his radical overhaul of the economy despite widespread discontent with his deep austerity measures.
* China’s state-owned defense giant Norinco in February unveiled a military vehicle capable of autonomously conducting combat-support operations at 30 mph (50 kph). It was powered by DeepSeek, the company whose artificial intelligence model is the pride of China’s tech sector.
* A common view in the crude oil market is that Western sanctions against Russia’s exports are fairly pointless as the market quickly devises ways to keep cargoes flowing. But ROI Asia Commodities Columnist Clyde Russell argues that it all depends on what Western powers want to achieve.
* Copper has a long history of mine supply disruption, but this year is proving to be a particularly troubled one for a sector that has been racing to keep up with smelter demand. Read the latest from ROI Metals Columnist Andy Home.
Top Chinese and U.S. officials on Sunday hashed out a framework for a trade deal for President Donald Trump and Chinese President Xi Jinping to decide on later this week, one aimed at pausing steeper U.S. tariffs and Chinese rare earths export controls.
Treasury Secretary Scott Bessent said talks at the ASEAN Summit in Kuala Lumpur had eliminated the threat of Trump’s 100% tariffs on Chinese imports from November 1, and he noted that he expected China to delay rare earth export curbs too.
U.S. stock indexes clocked record closing highs on Friday, with the biggest weekly gains since August after a slightly softer-than-feared September U.S. inflation readout baked in expectations for another Federal Reserve interest rate cut on Wednesday.
Wall Street index futures surged another 1% ahead of Monday’s bell, with Japan and South Korea’s equity benchmarks up more than 2% each and Chinese stock indexes up more than 1% to more than 10-year highs. China’s offshore yuan also jumped to a six-week high, guided by a People’s Bank of China reference rate that was at its strongest since October last year.
This week’s earnings diary sees five of the so-called “Magnificent Seven” megacaps – Meta, Microsoft, Alphabet, Amazon and Apple – due to report. They collectively make up about a quarter of the entire S&P 500 value.
Facing a heavy schedule of new debt sales this week, including $139 billion in 2- and 5-year notes later today, U.S. Treasury yields have nudged higher, helped along by the stock market surge and creeping inflation expectations in surveys.
The Bank of Canada is expected to cut by a quarter point on Wednesday, too, with Trump’s decision to add a 10% additional tariff on Canadian imports likely to reinforce the easing argument. Meanwhile, the Canadian dollar remains firm.
Chart showing cloud growth of AWS, Microsoft and Google in AI era
Five of the so-called “Magnificent Seven” megacaps report earnings this week, including Meta, Microsoft, Alphabet, Amazon and Apple. AI-related capex and cloud computing growth will be watched very closely.
Today’s events to watch
* Dallas Federal Reserve’s October manufacturing survey (8:30 AM EST)
* U.S. corporate earnings: Universal Health, Cincinnati Financial, Cadence Design, NXP, Welltower, Principal Financial, Keurig Dr Pepper, Brown & Brown, Nucor, F5, Revvity, Hartford, Arch Capital, Waste Management, Alexandria Real Estate
* U.S. Treasury sells $69 billion of 2-year notes and $70 billion of 5-year notes
* U.S. President Donald Trump visits Japan as part of wider Asia tour
Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, opens new tab, is committed to integrity, independence, and freedom from bias.
Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.
Mike Dolan is Reuters Editor-at-Large for Finance & Markets and a regular columnist. He has worked as a correspondent, editor and columnist at Reuters for the past 30 years – specializing in global economics and policy and financial markets across G7 and emerging economies. Mike is based in London but has also worked in Washington DC and in Sarajevo and has covered news events from dozens of cities across the world. A graduate in economics and politics from Trinity College Dublin, Mike previously worked with Bloomberg and Euromoney and received Reuters awards for his work during the financial crisis in 2007/2008 and on Frontier Markets in 2010.
