European economic data offered some support, with Eurozone GDP growing 0.4% quarter-on-quarter in the preliminary third-quarter estimate, beating forecasts of 0.2%, although slowing from the previous 0.6%.

Technology stocks came under renewed pressure for a second consecutive session as disappointing earnings intensified the rotation out of AI-related investments. Nasdaq 100 futures fell 2% after Amazon and Intel results raised fresh concerns about technology spending and demand. Amazon dropped 7.3% in after-hours trading, while Intel plunged 23% after its revenue outlook missed expectations, reflecting weaker PC processor demand and supply-chain challenges affecting data-centre components.

The selloff pushed investors towards traditional safe-haven assets. US Treasury yields declined across the curve, with bonds in Australia, Japan and New Zealand following the move. The Swiss franc strengthened against the dollar, while gold fell below $4,000 an ounce and silver lost 2%. Bitcoin also slipped to around $78,400 after Binance suspended deposits and withdrawals while investigating a suspected security breach.

Oil moved in the opposite direction. Brent crude climbed 1.4% to $116.45 a barrel amid signs that the US could resume military strikes against Iran, raising concerns over regional stability and potential disruption to energy flows. The Persian Gulf remains a key source of uncertainty for global energy markets, with any escalation threatening to push oil prices higher and add further pressure to inflation.

In monetary policy, the Bank of Japan kept interest rates unchanged but indicated that underlying inflation had reached its 2% target for the first time. This could open the door to a rate increase as early as December. However, Tokyo's consumer inflation remained above the central bank's target, highlighting persistent price pressures.

Meanwhile, China's Communist Party renewed its powerful Politburo for the first time in more than three decades and announced plans for a congress next year, where new leadership is expected to be unveiled.

Global markets are facing a difficult combination of weaker technology sentiment, geopolitical risks and persistent inflation pressures. Investors are increasingly favouring capital preservation as questions over AI spending weigh on equities, while developments in the Persian Gulf continue to influence oil prices and the broader inflation outlook.

FISG Daily Market Wrap provides a concise view of the forces moving global markets, helping investors stay informed and better prepared for what comes next.

FISG — Interstellar Group