HSI Index Falls To November Low

Stocks

Summary:

Today, the Hong Kong stock index HSI (Hong Kong 50 on FXOpen) is showing downward momentum, dropping below 25,200 for the first time since mid-October.

Today, the Hong Kong stock index HSI is showing downward momentum, dropping below 25,200 for the first time since mid-October.

Factors adding to selling pressure include (according to media reports):

→ Tech sector slump: Hong Kong is following the US, where investors have started offloading tech giants' shares amid fears of an AI "bubble." Market participants worry that current company valuations are overinflated. Even Nvidia's strong report released this week only provided a short-term boost.

→ Geopolitics: In addition to strained trade relations between China and the US, tensions with Japan have added to uncertainty.

→ China's economic data: Indicators continue to raise concerns despite government stimulus measures.

Technical analysis of the HSI (Hong Kong 50 on FXOpen) shows that price action since late summer 2025 formed an upward channel (marked in blue).

At the same time:

→ on 5 November, the price rebounded sharply from the lower boundary, confirming strong buying interest;

→ this week (as indicated by the arrow), it failed to reverse upwards.

As a result, bears have pushed through an important support level and are attempting to consolidate their gains.

It is possible that:

→ the 25,700 level (where the channel was broken) may act as resistance;

→ bears may grow more ambitious, potentially driving the HSI (Hong Kong 50 on FXOpen) down to test key support around 24,800 in the near term.

Source: FXOpen

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Winkelmann

Commodity

Forex

XAUUSD prices have fallen towards the 4,030 USD area following the release of US labour market data.

XAUUSD forecast: key trading points

· Market focus: US Nonfarm Payrolls increased by 119 thousand in September

· Current trend: correcting downwards

· XAUUSD forecast for 21 November 2025: 4,100 or 4,000

Fundamental analysis

On Friday, XAUUSD prices are declining amid weakening expectations of a Federal Reserve rate cut in December after the release of the employment report.

The long-awaited report from the US Department of Labor, delayed due to the government shutdown, showed that the number of nonfarm jobs increased by 119 thousand in September, exceeding the forecast of 50 thousand.

Analysts note that these figures confirm the Fed's October assessment that the labour market is cooling but remains stable. Meanwhile, the unemployment rate rose to 4.4%, the highest level since October 2021, surpassing the expected 4.3%, while wage growth came in slightly above forecasts at 3.8%.

XAUUSD technical analysis

XAUUSD quotes corrected towards the area around 4,030 USD amid growing doubts about a further Federal Reserve rate cut this year. The Alligator indicator is pointing downwards, meaning the corrective movement may continue.

The short-term XAUUSD price forecast suggests further growth towards 4,100 USD and higher if buyers regain control and find a foothold above 4,050 USD. Conversely, if sellers keep prices below 4,050 USD, a decline towards the 4,000 USD support level is possible.

Summary

Gold continues its downward correction, dropping to the 4,030 USD area as market participants doubt the Fed will cut rates at the December meeting.

Source: RoboForex

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Golden Gleam

Economic

Commodity

Gold slipped on Friday and was heading for a weekly drop, as a stronger-than-expected US jobs report reinforced expectations that the Federal Reserve would refrain from cutting interest rates at its December meeting.

Spot gold fell 0.9% to US$4,039.86 per ounce, as of 0643 GMT. Bullion has dipped 1% this week. US gold futures for December delivery dipped 0.6% to US$4,035.60 per ounce.

"Gold prices are consolidating at the moment, and we see the dollar has strengthened quite a bit, and behind it, there is a lot of speculation whether the Fed will continue to cut interest rates or not," GoldSilver Central MD Brian Lan said.

"I think now the market is unsure, and especially, now, when we are going to the end of December, we expect a lot of traders will be taking profit off their positions, and that's what we saw at the end of last week to this week."

The dollar was on track on Friday for its strongest week in more than a month. A stronger dollar makes greenback-priced gold more expensive for holders of other currencies.

The closely watched US Labor Department report, delayed by the federal government shutdown, showed that September non-farm payrolls increased by 119,000, more than double the estimated increase of 50,000.

Traders now see nearly a 39% chance for a Fed rate cut next month. Gold, a non-yielding asset, tends to do well in low-interest-rate environments.

Chicago Fed president Austan Goolsbee repeated on Thursday he is "uneasy" about frontloading rate cuts, particularly with progress on inflation towards the Fed's 2% goal looking to have stalled and starting to go the wrong way.

Meanwhile, physical gold demand across major Asian markets remained weak this week, as volatility in rates deterred potential buyers from making purchases.

Elsewhere, spot silver slipped 2.2% to US$49.48 per ounce, platinum fell 0.4% to US$1,505.96, and palladium dipped 1.4% to US$1,358.15.

Source: Theedgemarkets

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Gerik

Economic

Strategic Timing Ahead of BOJ’s December Deliberations

In a move poised to influence both markets and monetary policymakers, a group of influential economic advisers aligned with Prime Minister Sanae Takaichi’s reflationary agenda will headline a panel discussion hosted by Keidanren, Japan’s top business lobby, on December 17. This event comes just 24 hours before the Bank of Japan (BOJ) begins its two-day monetary policy meeting, scheduled for December 18–19. The proximity of the forum to the BOJ meeting has sparked speculation that it may serve as a signal-setting venue for the administration’s preferred economic direction.

The panel will feature prominent voices such as Etsuro Honda and Masazumi Wakatabe, both of whom have historically championed accommodative monetary policy and fiscal expansion. Their participation is notable not just for their ideological alignment with Takaichi, but for their potential to shape the BOJ's policy tone through public discourse.

Reflationary Policy Advocates Reassert Influence

Prime Minister Takaichi, who assumed office last month, has made reflating the Japanese economy a cornerstone of her economic platform. Her administration finalized a ¥20 trillion ($135 billion) stimulus package on Friday, financed in large part through new debt issuance. The December 17 panel, taking place from 2 to 4 p.m. in Tokyo, offers a platform for key economic thinkers to reinforce the administration’s policy priorities ahead of what could be a pivotal BOJ decision.

Etsuro Honda has already warned against further rate hikes by the central bank, citing risks to economic recovery. Similarly, former BOJ Deputy Governor Masazumi Wakatabe told Reuters that it would be difficult for the central bank to justify another rate increase before the end of the year. Other panelists include economists Toshihiro Nagahama and Takuji Aida, both of whom have served on government panels advocating for large-scale stimulus.

Causal Interplay Between Fiscal Policy, Monetary Strategy, and Currency Pressures

The timing of the event also reflects the delicate balance between fiscal expansion and monetary normalization. Since Takaichi took office, concerns over aggressive government spending combined with the BOJ’s slow pace of interest rate normalization have weighed on the Japanese yen, which has fallen to a 10-month low against the U.S. dollar. The depreciation has raised fresh fears over imported inflation, prompting warnings from financial authorities about the potential impact on consumer prices.

This presents a complex causal landscape: Takaichi’s stimulus-led strategy supports short-term growth but intensifies downward pressure on the yen, which in turn may compel the BOJ to consider rate hikes to stabilize the currency and manage inflation. Yet with core inflation still hovering around the BOJ’s target and growth remaining fragile, rate increases carry significant risks to domestic demand and debt sustainability.

Monetary Policy at a Crossroads: What’s at Stake for the BOJ

The December BOJ meeting will likely be a critical inflection point. If the board signals readiness to raise rates in early 2026, it would mark a departure from over a decade of ultra-loose monetary policy. However, the political environment, shaped by a newly elected administration with a pro-stimulus mandate, complicates that pathway.

The BOJ must now weigh external pressure to address yen weakness and inflation concerns against internal pressure to maintain accommodative conditions for fiscal stimulus to take effect. The public remarks of Honda, Wakatabe, and other reflationist advisers on December 17 may provide insight into how the administration expects the central bank to position itself.

With Japan navigating a fragile recovery, high debt levels, and volatile currency markets, the coordination between fiscal and monetary policy is more consequential than ever. The Keidanren panel offers a strategic opportunity for Prime Minister Takaichi’s economic advisers to assert their vision at a critical moment, potentially swaying the BOJ’s decision-making framework. Investors, policymakers, and international observers will be watching closely to discern whether Japan will double down on stimulus or begin recalibrating its approach to inflation and currency management.

Source: Reuters

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Gerik

Economic

Stocks

Broad-Based Sell-Off Mirrors Wall Street Volatility

Asian equities plunged on November 21 as markets mirrored the previous day’s dramatic downturn in U.S. stocks. Major indices across the region gave up earlier gains, with Japan’s Nikkei 225 falling 2.4% to 48,645.95, South Korea’s KOSPI plunging 3.9%, and China’s Hang Seng and Shanghai Composite indices down 2.3% and 1.8%, respectively. Australia’s S&P/ASX 200 dropped 1.5%, while Taiwan’s Taiex slid 3.2%. The widespread retreat follows one of the most volatile trading sessions on Wall Street this year, where initial optimism around AI leader Nvidia gave way to deep concerns about asset overvaluation.

The cause of this synchronized regional decline is rooted in investor anxiety over the artificial intelligence sector’s sharp rally, which many now fear is unsustainable. The U.S. session on Thursday was defined by a sudden shift in sentiment: Nvidia and other AI-driven stocks surged early before collapsing later in the day. The Nasdaq Composite ended 2.2% lower, the S&P 500 dropped 1.6%, and the Dow Jones Industrial Average lost 0.8%.

AI Bubble Concerns Deepen Despite Strong Nvidia Earnings

Nvidia, a bellwether for the AI hype cycle, initially buoyed investor confidence with robust earnings and a revenue forecast that exceeded expectations. CEO Jensen Huang rejected concerns of an AI bubble, attempting to reassure markets. However, despite these fundamentals, traders appeared unconvinced. Nvidia’s stock reversed from a 5% morning gain to close 3.2% lower, illustrating that technical momentum and valuation fatigue may now be overpowering earnings performance.

The broader correlation between Nvidia’s reversal and losses in other tech-heavy markets, such as South Korea and Taiwan, signals that AI-driven sentiment is still the dominant force shaping regional risk appetite. SK Hynix and Samsung Electronics two key semiconductor players fell 8.6% and 5.8%, respectively, as investor nervousness spread across global chip and data infrastructure stocks.

Fed Policy Expectations Recalibrated on Strong Labor Data

Adding to the global market strain was stronger-than-expected U.S. employment data. The economy added 119,000 jobs in September, more than double the forecast of 50,000. While this suggests economic strength, the causal implication is that the Federal Reserve may delay or cancel its next interest rate cut, as inflationary pressures may persist.

With the Fed potentially holding rates higher for longer, growth-sensitive assets like tech and AI stocks become less attractive due to their reliance on low borrowing costs to justify high valuations. This monetary policy reassessment has compounded volatility and shifted market psychology away from risk-on positioning.

Japan Faces Dual Pressures: Tariffs and Stimulus Expectations

Japan’s economy faces its own set of pressures. Despite a 3.7% rise in exports globally in October, shipments to the U.S. declined due to new 15% tariffs under President Donald Trump’s trade framework. This export hit, combined with elevated inflation (3.0% in October), has dampened investor sentiment. Meanwhile, investors are awaiting details of a stimulus package from Prime Minister Sanae Takaichi, with anticipation of fiscal expansion weakening the yen and placing pressure on government bonds.

Political tensions with China over Taiwan have further unsettled regional investors, adding a layer of geopolitical risk that weighed on Chinese and Japanese equities. The deterioration in diplomatic relations could potentially disrupt trade channels and deepen volatility in the weeks ahead.

Oil Prices and Currency Markets Reflect Risk-Off Sentiment

In commodities, oil prices slipped as investor sentiment cooled. U.S. benchmark crude fell by 77 cents to $58.23 per barrel, while Brent crude dropped 68 cents to $62.70. These declines reflect expectations of softer demand amid tightening financial conditions. Currency movements were relatively muted: the U.S. dollar edged down slightly to 157.39 yen, while the euro firmed marginally to $1.1539.

Friday’s sell-off across Asian equities highlights the fragile nature of current market sentiment. While Nvidia’s earnings momentarily reignited AI enthusiasm, the broader market quickly pivoted to focus on stretched valuations, Federal Reserve policy uncertainty, and geopolitical instability. With little clarity on the Fed’s next move and concerns of an AI bubble persisting, investors appear poised for continued turbulence. The risk-off tone could deepen unless forthcoming data or policy guidance provides more definitive support for global risk assets.

Source: AP

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Gerik

Economic

Stocks

Market Sentiment Reverses as AI Surge Gives Way to Skepticism

What began as a high-energy rally on Wall Street quickly turned into one of the most volatile trading sessions in recent months. On November 20, 2025, the Nasdaq Composite closed down 2.16% after climbing as much as 2.6% in the morning. Similarly, the S&P 500 fell 1.56% and the Dow Jones Industrial Average dropped 0.84%, despite intraday gains earlier in the session. The reversal came swiftly and was largely driven by renewed concerns surrounding the sustainability of the artificial intelligence sector’s meteoric rise.

Nvidia was at the center of this turmoil. Initially surging 5% on investor optimism following statements from CEO Jensen Huang dismissing the existence of an AI bubble, the stock reversed course and ended the day down 3.2%. The pattern was mirrored by fellow AI-linked names like Oracle and AMD, suggesting that broader market sentiment could not be calmed by a single executive’s reassurance.

Nvidia’s Outlook Strong, But Market Eyes Broader Systemic Risks

The company’s CFO, Colette Kress, reaffirmed Nvidia’s bullish revenue outlook, projecting a “half a trillion” forecast, while minimizing the role of Chinese demand in the latest quarter. Despite this, the stock market's reaction indicates that investor optimism in the AI space may have reached unsustainable levels. The initial spike in Nvidia’s share price reveals a correlational relationship between investor sentiment and high-profile corporate forecasts, but the rapid selloff afterward suggests underlying skepticism about whether the AI boom is built on stable foundations.

Analysts caution that while Nvidia’s fundamentals remain robust, the broader AI ecosystem particularly data center builders and firms heavily leveraging debt may be more vulnerable. According to Gil Luria from D.A. Davidson, the concern is not with the chipmakers but rather with downstream companies overextending themselves financially to support AI infrastructure demands.

Labor Market Data Fuels Fed Rate Speculation

Thursday’s turmoil was exacerbated by stronger-than-expected labor market data. The U.S. economy added 119,000 jobs in September, far surpassing the 50,000 estimate. While this would normally be interpreted as a positive signal, in the current macroeconomic context, it has the opposite effect. A robust labor market reduces the likelihood of the Federal Reserve cutting interest rates in the near term a key hope that had helped fuel risk asset rallies throughout the year.

As a result, traders revised their expectations, with CME FedWatch data indicating a higher probability that rates will remain unchanged in December. The causal relationship here is straightforward: stronger employment metrics decrease the urgency for the Fed to pivot toward monetary easing, thereby placing downward pressure on equities especially those with high growth valuations like AI stocks.

Bubble Talk Gains Momentum, But No Immediate Popping Sound

The sudden shift in market tone was further amplified by high-profile voices like Bridgewater founder Ray Dalio, who publicly stated that "the picture is pretty clear" regarding the presence of a financial bubble. While he advised investors to remain invested for now, his remarks underscored a growing unease that has begun to spread through institutional circles.

Dalio’s statement did not point to an imminent collapse, but it reinforced the narrative that market valuations particularly in sectors like AI may be detached from sustainable fundamentals. This concern, when layered over a delayed monetary policy pivot and stretched corporate borrowing, paints a picture of fragility beneath the recent tech-driven rally.

Global Market Divergence Reflects Differing Investor Priorities

While the U.S. indices closed deep in the red, Europe’s Stoxx 600 climbed 0.4%, supported by gains in AI-related firms such as ASML and BESI. This divergence may be partially explained by differing exposure to U.S. interest rate policy and sector concentration, but it also highlights that AI enthusiasm remains alive in certain global pockets. However, that enthusiasm is increasingly tempered by selectivity and fundamental analysis.

Bitcoin also joined the downturn, hitting its lowest level since April, showing that risk aversion extended beyond equities and into crypto markets suggesting a broader de-risking across speculative assets.

Thursday’s trading session demonstrated how quickly market narratives can unravel, especially when speculative momentum meets macroeconomic reality. Nvidia’s strong forecast offered temporary confidence, but investor anxiety about inflated valuations, monetary tightening, and overleveraged AI infrastructure projects quickly overrode the optimism. As the year winds down, the question is no longer whether AI is the future, but whether markets have already priced in too much of that future too quickly. Investors now face the delicate task of distinguishing between sustainable innovation and speculative froth while keeping one eye on the Fed and the other on earnings reports.

Source: CNBC

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Gerik

Economic

Mixed Trade Performance Highlights Diverging Regional Trends

Japan’s export sector showed signs of resilience in October, posting a 3.7% year-on-year increase in global shipments, while imports edged up 0.6%, according to the Finance Ministry’s latest data. However, the country’s trade relationship with the United States continued to deteriorate, with exports to its largest non-Asian partner declining 3.1% a trend now in its seventh consecutive month. This export contraction is largely attributable to the tariff framework introduced by President Donald Trump, which imposed a 15% levy on most Japanese imports starting in July 2025.

Although the new tariff rate is lower than the initially proposed 25%, it still represents a significant escalation from the previous average of 2.5%. The causal relationship between these heightened tariffs and Japan’s declining exports to the U.S. is reflected in reduced shipments of key products such as computer parts, industrial machinery, buses, and trucks. As these goods become more expensive for U.S. buyers, Japanese exporters face reduced demand and eroded competitiveness.

Import Dynamics Reflect Broader Shifts in Bilateral Trade

Interestingly, Japan’s imports from the U.S. surged 20.9% in October, suggesting a shift in bilateral trade balance. This growth was led by food products, especially cereals, as well as petroleum. The increase may stem from seasonal demand and the relative cost-effectiveness of U.S. agricultural exports despite the broader trade tensions. The juxtaposition of declining Japanese exports to the U.S. with rising American imports indicates a widening asymmetry that is unfavorable to Japan’s trade surplus goals.

Beyond bilateral trade, soybean imports from all global sources surged 37.3%, possibly due to domestic agricultural supply issues or feedstock demand. Meanwhile, imports of iron and steel dropped 17.1%, likely reflecting a cooling in construction or manufacturing investment cycles.

Asia Emerges as a Growth Engine Amid U.S. Weakness

Japan’s trade data reveals a regional rebalancing in its export strategy. Exports to China rose 2.1%, while shipments to Hong Kong and Taiwan posted significant gains of 19.2% and 17.7%, respectively. These trends suggest that Japan is actively shifting its export focus toward more receptive Asian markets, both to offset U.S. trade friction and to capitalize on regional demand.

This correlational pivot toward Asia may become increasingly intentional. Analysts warn that given ongoing strain with the U.S. and new political frictions with China triggered by Prime Minister Sanae Takaichi’s pro-Taiwan comments Japan’s long-term export strategy will need to balance regional diplomacy with market diversification.

Trade Deficit Narrows, But Vulnerabilities Remain

The improved export performance and modest import rise helped Japan narrow its trade deficit to 231.77 billion yen (approximately $1.5 billion), a significant reduction from the 499.95 billion yen ($3.2 billion) recorded a year earlier. This narrowing is statistically positive, but it does not erase the structural concern that the deficit could widen again if U.S. demand continues to soften and political tensions with China escalate.

While October’s figures show that Japan is partially adapting to its new trade environment, the sustainability of its recovery remains uncertain. The government may need to strengthen ties with Southeast Asia and India to create buffers against future economic or political shocks in its two largest export markets the U.S. and China.

Japan’s October trade data underscores a complex economic reorientation shaped by tariff policies, geopolitical tensions, and shifting regional dynamics. With U.S.-bound exports in steady decline due to policy-induced friction and a rising appetite for Japanese goods in parts of Asia, Japan is recalibrating its external trade dependence. Whether this pivot will be enough to stabilize long-term growth depends on its ability to navigate a volatile global landscape while maintaining diversified export relationships and domestic resilience.