Gold Miners Outshine AI Chip Boom with 135% Rally in 2025

We noted on 29 September that, amid the US shutdown, sentiment in the S&P 500 index market remained positive, and highlighted factors supporting further growth.Today, the S&P 500 index (US SPX 500 mini on FXOpen) reached a fresh all‑time high: on Friday morning the price rose above 6 740 points. This confirms the continued optimism among market participants. Today this is supported by news related to the creators of ChatGPT.

According to media reports, OpenAI:→ has reached a valuation of $500 billion following a deal in which current and former employees sold shares worth around $6.6 billion;→ is expanding cooperation with semiconductor manufacturers in South Korea, which is expected to sustain the company’s high growth rate.

Thus, OpenAI’s successes are boosting investor optimism ahead of the upcoming earnings season.

These and other positive developments might have been overshadowed by the regular Non‑Farm Employment Change report (and other US labour market data), but the Bureau of Labour Statistics is closed due to the shutdown.

Technical analysis of the S&P 500 chart

Recent data on the 4‑hour chart of the S&P 500 index underline sustained optimism, as the price develops within a previously established ascending channel, highlighted in blue.From a bullish perspective:→ bulls showed strength by breaking a local resistance level at 6 700, which later acted as support (indicated by an arrow);→ local peaks allow for steeper upward trendlines to be drawn;→ if the move from A→B is seen as the main impulse and B→C as a correction, the correction appears shallow, as the reversal upwards occurred from the 0.382 Fibonacci level, highlighting strong demand.

From a bearish perspective:→ the price is approaching the upper boundary of the channel, where profit‑taking by long holders is typical;→ the current peak on the e‑mini S&P 500 chart slightly exceeds the October high (A), suggesting the potential for a bearish divergence;→ the absence of news creates an “information vacuum” that could significantly influence market sentiment if filled with negative data.

Nonetheless, optimism persists, with Tom Lee (Fundstrat) forecasting that the S&P 500 index will exceed 7 000 points by year‑end.

Source: FXOpen

Putin’s Message and Threat Assessment

Geopolitical Context

Source: CNBC

British business activity grew at the slowest pace in five months in September as companies and consumers put big spending decisions on hold as they waited to see if they would be hit by tax rises in November's budget, a survey showed on Friday.

The S&P Global Purchasing Managers' Index for Britain's services sector sank to 50.8 in September from 54.2 in August, its lowest since April and well below an initial estimate of 51.9.

The composite PMI - which includes a weak reading for the manufacturing PMI on Wednesday - was also revised downward to its lowest since April at 50.1, only a whisker above the 50-mark that divides growth from contraction.

"This summer's acceleration in output growth is now looking like a flash in the pan as elevated political and economic uncertainty has reasserted itself as a constraint on service sector performance," S&P economics director Tim Moore said.

"Many survey respondents suggested that corporate clients had deferred spending decisions until after the Autumn Budget, while households were also hesitant about major purchases," he added.

Finance minister Rachel Reeves is due to present her second annual budget on November 26 and many economists think she will need to raise taxes or squeeze spending by tens of billions of pounds, just over a year after she set out the biggest tax-raising budget since 1993.

Businesses were the hardest hit last year with an increase in mandatory social security contributions which took effect in April.

S&P said its data showed services businesses had cut jobs for each of the past 12 months while companies' costs were rising more slowly than before.

"Signals of softening labour market conditions and easing inflationary pressures are likely to provide support to the more dovish shift in the policy debate at the Bank of England," Moore said.

BoE policymakers have been divided on the extent to which a likely temporary pick-up in inflation to close to double its target should make it cautious about cutting rates further from their current 4%.

Source: Reuters

USD: We'll still see ISM services

Traded volatility is falling across financial markets. Investors have settled into the view that the Fed will likely cut rates twice more this year and probably another 50bp in 2026. The US interest rate volatility – so often the driver of volatility in other asset classes – is just not here at the moment. And the delay in big US data releases, such as today's US jobs report, further postpones forming a clear view on the friction between sticky inflation and a softening labour market. Instead, the world is left to watch in wonder at the ongoing AI rally. The latest news is that OpenAI is being given a valuation of close to $500bn in its latest funding round – compared to $300bn earlier this year.

Low volatility means continued interest in the FX carry trade, where the Turkish lira remains very popular (see below). There also remains a strong interest in the Egyptian pound, which continues to rally despite another 100bp rate cut yesterday. Hungary's forint also remains a recipient of carry trade inflows.

The DXY dollar index has ground to a halt near 98. We doubt today's release of the September ISM services data will have much impact. We also have an array of central bank speakers at Klaas Knot's farewell symposium in Amsterdam – including the Fed's John Williams. Additionally, we will hear from Fed superdove, Stephen Miran, twice today. The debate over the next Fed chair has taken a backseat for the time being, but will return. Current betting odds show the favourites as Christopher Waller (12%), Kevin Warsh (10%) and Kevin Hassett (9%).

There are also a couple of weekend event risks for traders to consider. The Japanese LDP leadership election result should be announced tomorrow, where Sanae Takaichi would be seen as more yen bearish than Shinjiro Koizumi. And a Bank of Japan hike is still priced at 60% for the end of the month. We think the yen is undervalued and should meet good buying on any dips. And the weekend also sees an OPEC+ meeting, with risks of a higher supply increase as the Saudis try to reclaim market share. Lower oil prices are a dollar negative.

EUR: Lower energy prices are good news

EUR/USD remains glued to the 1.1700 area. Three-month traded volatility has dropped to its lowest level since last November, at 6.60%. Interestingly, the three-month risk reversal skew in the EUR/USD FX options market remains at 0.5% in favour of euro calls. So, it's not as though investors have given up on the EUR/USD upside; it's more that they think there will be less volatility in general.

As above, lower energy prices are good news for the euro. The euro's terms of trade (export less import prices) are towards the higher levels of the year as both crude oil and natural gas prices soften. This will help the euro's valuation metrics.

For today, there's little eurozone data of note, but we do hear from ECB speakers Lagarde, Schnabel and Wunsch. The ECB script at the moment remains one of the 2.00% deposit rate being at a good place, but that the central bank would not hesitate to act if needed. That threat to act probably means one further rate cut should inflation undershoot at a time of weak activity. However, the market struggles to price another 25bp cut in this cycle.

It's hard to see EUR/USD moving out of a 1.1700-1750 range today.

TRY: Inflation threatens future rate cuts

Today, Turkey will publish its inflation figures for September. We expect September inflation at 2.4% MoM and 32.2% YoY, while risks are on the upside given continuing pricing pressures in food with adverse weather conditions and the start of the school season pushing education inflation higher. Istanbul CPI also printed at 3.19% MoM, implying a higher MoM headline figure. If we get a figure close to or above 3.0%, we can expect current market expectations of central bank rate cuts to come under pressure.

In its latest August forecast, the central bank sees inflation at 28.5% at the end of the year, which already seems like an optimistic projection, and any upward surprise would further reduce the likelihood of this target being met. This would likely lead to rate cuts of less than 250bp at the remaining two meetings this year.

The market shifted to the dovish side after the Central Bank of Turkey's larger-than-expected rate cut, and 1y OIS is close to its lowest levels since the start of the hiking cycle in 2023. Although the market has become accustomed to political headlines, the threat of a cutting cycle should still have an impact, especially at the front of the curve. FX, on the other hand, remains on a stable weakening path, and we believe that nothing will change here until at least the end of the year. TRY thus remains our favourite carry currency in the EMEA world. We expect USD/TRY to head towards 45.00 at the end of the year, but still very well compensated on the carry side.

CZK: Election fiscal fears are exaggerated

The Czech Republic is holding general elections today and tomorrow. Polls widely suggest a change of government, and the question is whether the main opposition party will form a minority government with the support of some parties or whether we'll see a coalition of the current opposition parties. In recent weeks, the market has begun to price in some risk premium, particularly at the end of the bond and IRS curves, signalling fiscal expansion compared to the current fiscally conservative government. At the same time, the Czech National Bank sees fiscal policy as one of its inflation risks, which would suggest higher rates in the future.

However, we consider market concerns to be exaggerated and see Czech assets as cheap after the sell-off in recent weeks. The CZK remains unchanged for now, and the pre-election impact is particularly visible in the fixed income universe. Although we do not expect significant changes on the fiscal side in any election scenario, this may be one of the factors for the central bank to remain hawkish, which should further support the currency. Therefore, despite some potential volatility in the short term, we continue to expect EUR/CZK to head towards 24.00.

Source: ING

Growth in the euro zone services sector accelerated slightly in September to an eight-month high, although the expansion remained modest with hiring stalling amid a limited improvement in demand, a survey showed.

The HCOB Eurozone Services PMI Business Activity Index rose to 51.3 in September from 50.5 in August, S&P Global reported. That suggested a fourth consecutive month of expansion as readings above 50.0 indicate growth in activity.

"Things are running a little bit more smoothly in the service sector. After almost stagnating in August, business activity picked up more strongly in September," said Cyrus de la Rubia, chief economist at Hamburg Commercial Bank.

The recovery was widespread across most of the bloc, with moderate growth in Germany, Italy and Spain. However, France continued to struggle as political uncertainty weighed on its service providers.

While demand for services increased in the region at the strongest rate since August last year, the improvement was marginal. Foreign demand remained weak, with new export orders falling for the 28th consecutive month.

Despite limited growth in new business, service providers grew more optimistic about future activity, with business confidence reaching an 11-month high in September.

The broader HCOB Eurozone Composite PMI, which includes both services and manufacturing, edged up to 51.2 from 51.0 in August, marking its highest level since May 2024.

Notably, firms reduced their workforces slightly in September, breaking a hiring streak that had lasted since March. This occurred as companies continued to work through backlogs, which declined at the fastest pace in three months.

Price pressures eased somewhat during the month, with both input costs and selling prices rising at slower rates compared to August.

"Although both cost and sales price inflation rates are slightly above the long-term average, they declined in September," de la Rubia added.

Based on the PMI data, Hamburg Commercial Bank estimates the euro zone economy grew 0.4% last quarter compared to the previous three months. A Reuters poll last month put growth at 0.1%.

Source: TradingView

Key points:

A Finnish district court ruled on Friday that it does not have jurisdiction to prosecute the captain and two officers of the Eagle S oil tanker, who are accused of breaking undersea power and internet cables in the Baltic Sea last year.Finland has said the Eagle S is part of a shadow fleet of tankers used by Russia to circumvent sanctions on its oil exports. The December 25 incident was one of a string of cable and gas pipeline outages in the Baltic Sea since Russia invaded Ukraine in February 2022, putting NATO forces in the region on high alert. Russia has denied involvement in cable cutting.

The trial was among the first judicial attempts to punish suspected perpetrators for damaging critical underwater infrastructure, but is complicated by provisions of international maritime law and the difficulty of proving criminal intent. The three crew members denied the charges."The District Court has today issued a judgment dismissing the charge in the case... along with the claims for damages arising from the charge, as it was not possible to apply Finnish criminal law to the case," the court said in a statement.

Under the United Nations Convention on the Law of the Sea, the power to prosecute any crime rests with the ship's flag state or the defendants' native countries, the court added.

The ship operated under a Cook Islands flag.

The ruling remains subject to appeal.

DEFENDANTS BLAMED TECHNICAL FAULT

The tanker, carrying Russian oil, dragged its 11,000 kg (24,000 lb) anchor for 90 km (56 miles) across the Gulf of Finland seabed, breaking the Finnish-Estonian Estlink 2 power cable and four internet lines, prosecutors said.Finland charged the Georgian captain, as well as the Georgian first officer and the Indian second officer, with aggravated criminal mischief and aggravated interference with telecommunications.The charges rested on allegations of gross negligence on the part of the crew regarding the poor condition of the vessel's anchor winch, rather than firm evidence that the anchor was intentionally dropped to cause damage, court documents showed.

The defendants stated at trial that the vessel's anchor had dropped unnoticed due to technical faults in the winch that was supposed to hold it in place.They also rejected the cable owners' claims for tens of millions of euros in damages.The prosecutor had asked the court to sentence the defendants to prison for a minimum of two-and-a-half years each.The court lifted the defendants' travel bans at the end of the trial in September and they have since left Finland.No charges were brought against the ship's owner, and the vessel was released from Finnish custody in March.

Source: TradingView