Trade Optimism Sparks U.S. Market Surge

Agriculture and Symbolism: Soybeans Return

HSBC Posts Mixed Results

Saudi Arabia Bets on AI and Diversification

Source: CNBC

Equity bulls are lining up to wager the S&P 500 will surge past 7,000 now that it looks as if a seasonal bout of volatility has passed.

The index powered to a record 6,875 Monday, buoyed by positive signs on trade, expectations for an interest rate cut and strong corporate earnings. With that macro backdrop in place, bulls are pointing to other factors that can take the index past the psychologically important 7,000 level.

Fund flows show retail and institutional investors pouring into the market, while technical analyses show little resistance ahead of the round-number milestone. In a seasonal quirk, the current week stands out as the best for stocks over the past 75 years.

"There's no shortage of catalysts to push risk higher," Michael Romano, head of hedge fund equity derivative sales at UBS Securities, wrote in a note to clients Sunday. "What was once a blue-sky 7,100 into year-end is quickly turning into the base case as the market pulls forward next year's upside."

The optimism will get a stiff test this week, as five of the Magnificent Seven tech behemoths report results on Wednesday and Thursday. A handful of major central bank decisions are also due, from the likes of Japan and Europe, in addition to the Federal Reserve.

If stocks can weather that stretch, seasonal factors look beneficial. The final weeks of the year tend to favor risk assets. In data back to 1985, the Nasdaq 100 has averaged an 8.5% gain from Oct. 20 through year-end, while the S&P 500 returned 4.2% on average, according to Goldman Sachs Group Inc.'s trading desk.

More immediately, the last week of October stands out as the single best to be long equities, according to UBS data based on the S&P 500's rolling one-week average returns since 1950.

From a technical standpoint, analysts see further upside. The next resistance level for the S&P 500 sits near 7,000, just 1.8% above Monday's close, said John Kolovos, chief technical strategist at Macro Risk Advisors.

"That will be an important milestone and if the index pushes through, 7,500-7,700 becomes the next target," he said.

Alexander Altmann, Barclays Plc's global head of equities tactical strategies, sees the S&P 500 hitting 7,250 by December's close, citing the index's average absolute annual move of 23% over the past 5 years.

The so-called flow of funds also looks favorable as major investor groups are adding fuel to the rally.

Retail investors, which account for 22% of trading volume in US stocks, have been net buyers in 23 of the past 27 weeks, according to Citadel Securities.

Corporate buybacks that had been paused in the runup to earnings season are allowed again, with Goldman traders noting that the fourth quarter is historically active for repurchases.

Even hedge funds have turned into net buyers of US stocks after two weeks of heavy selling, snapping up equities as Friday's muted inflation data bolstered bets on rate cuts.

That's not to say there are no risks facing a stock market that's rallied 38% from April lows, pushing valuations to levels usually seen in times of bubbles.

While corporate results have been excellent so far, Microsoft Corp., Alphabet Inc., Meta Platforms Inc., Amazon.com Inc. and Apple Inc. — representing about a quarter of the S&P 500 by market capitalization — are yet to report results.

"If there's any sign of disappointment, or questions about AI spending not paying off, I expect investors will be quick to punish them," said Dave Mazza, chief executive officer of Roundhill Financial Inc.

On the other hand, tidy beats could give bulls their round number in just a couple days, he said.

"That could be the spark that keeps this rally burning and the S&P 500 can hit 7,000 this week."

Source: Bloomberg Europe

The European Union and China will hold talks this week to address trade disputes as Beijing's restrictions on exports of key minerals and chips risk disrupting Europe's auto industry.The European Commission will receive a Chinese delegation to discuss rare earth restrictions, which sounded alarm bells among governments and firms across the bloc. Preliminary talks were held on Monday to prepare for the arrival of a high-level Chinese technical delegation on Thursday, said Olof Gill, a spokesman for the EU's executive arm.

China announced plans to significantly tighten controls on its exports of rare earths and other critical materials earlier this month. Under the measures, overseas exporters of items that use even traces of certain minerals sourced from China would need an export licence.In a separate dispute, Beijing is blocking Nexperia from exporting products from its affiliate in China. The move was retaliation after the Dutch government took control over the Nijmegen-based company because of concerns that China's Wingtech Technology Co — Nexperia's owner — was seeking to hobble the chipmaker.

The talks in Brussels will coincide with a meeting between US President Donald Trump and Chinese President Xi Jinping in South Korea to defuse bilateral trade tensions. US Treasury Secretary Scott Bessent said China would delay its expanded licensing regime for minerals by a year while they reexamine it.Brussels and European capitals have been discussing options to address shortages. The turbulence comes as European industry races to boost competitiveness, while disruptions to global commerce intensify pressure from technological changes. European officials have admitted that there are no quick fixes as relations with China continue to sour.

The EU is working on a contingency plan including boosting production of minerals on its soil, diversifying its network of suppliers and reusing some materials. In addition, it wants to set up a joint purchasing and strategic stockpiling centre, the commission said.In parallel, European and Chinese officials have initially discussed allowing temporary exports of Nexperia chips to keep supply flowing while a longer-term solution is negotiated, a person familiar with the matter said. Such a move is seen by the auto industry as the most plausible way to avert widespread production outages, the person added.

"We take the situation facing companies very seriously and are in contact with those affected," Luisa-Maria Spoo, a spokeswoman for the German economy ministry, said Monday in a regular government press briefing in Berlin. "We view potential supply-chain difficulties with concern and are working with China to promote the interests of the German economy."She added that Chancellor Friedrich Merz's administration is in contact with the EU and made its position clear during a meeting on Friday.While the commission is seeking a negotiated solution, the EU executive has also been preparing trade options to retaliate against China's restrictions in an attempt to gain leverage during the talks.

Commission President Ursula von der Leyen said over the weekend that all options are on the table after France's Emmanuel Macron last week called for using the anti-coercion instrument, the EU's most powerful trade tool, in the dispute with China."The essence of China-EU economic and trade relations lies in complementary advantages and mutual benefit," China Foreign Ministry spokesman Guo Jiakun said at a regular press briefing in Beijing on Tuesday. "We hope the European side will honor its commitment to supporting free trade and opposing trade protectionism, refrain from frequently adopting restrictive measures, and instead resolve trade issues through dialogue and consultation."

Source: Theedgemarkets

Where to Buy WLTQ Crypto: Price, Prediction — Everything You Need to Know

WLTQ Crypto has emerged as a trending digital asset gaining attention among investors seeking new blockchain opportunities. This guide explores what WLTQ is, how to buy it, recent market trends, and price predictions for 2025 and beyond, offering a comprehensive overview for both beginners and experienced traders.

Conclusion

WLTQ Crypto presents a growing opportunity for investors seeking innovative blockchain assets with real-world use cases. While its long-term success depends on adoption, partnerships, and broader market conditions, WLTQ’s steady progress and active community suggest potential for sustainable growth in the evolving crypto landscape.

Strengthening the Alliance: Trump and Takaichi Showcase a Strategic Partnership

Defense, Diplomacy, and Domestic Politics: Takaichi Steps Into a Complex Role

Trade Deal or PR Exercise? The $550 Billion Investment Question

North Korea, Human Rights, and the Indo-Pacific Strategy

A Symbolic Alliance with Tactical Ambiguity

Source: Bloomberg

In focus today

In Sweden, the Riksbank will release the semi-annual Business Survey at 9.30 CET. While often overlooked by markets, the survey has historically been a key input for the Riksbank's monetary policy deliberations. We expect it to align with the view of the Riksbank's main scenario at this juncture, with a still weak but gradually recovering economy. Given persistently high inflation, we are paying particular attention to the quantitative measures on expected price changes. The May 2025 report showed that companies selling to households planned to raise prices over the next 12 months, reflecting higher purchasing costs and their inability to fully offset previous cost increases.

Economic and market news

What happened overnight

The US and Japan have signed a framework agreement aimed at securing supply chains for critical minerals and rare earths, reducing dependence on China. In a statement, the White House emphasised that the deal seeks to enhance the resilience and security of critical mineral and rare earth supply chains for both nations.

What happened yesterday

In the euro area, bank lending continued to grow in September, with loans to non-financial corporations increasing by 2.9% y/y. The credit impulse, which correlates more closely with GDP growth, remained stable at 0.3% of GDP, indicating that lower policy rates are still supporting the economy. This suggests euro area GDP likely grew in Q3, albeit at a slower pace than in the first half of the year. We expect Thursday's GDP data to confirm a modest 0.1% q/q growth for Q3.

The German Ifo indicator rose slightly more than expected in October, rising to 88.4 from 87.7. However, the current situation assessment declined unexpectedly to 85.3 – the lowest since February – pointing to ongoing economic challenges. In contrast, expectations rose sharply to 91.6 from 89.8, signalling optimism. While Ifo's current situation assessment remains weaker than the recent uptick in PMIs, the rebound in expectations and stronger PMIs suggest a gradual recovery in the German economy over the coming year.

Equities: Equities were on a steady grind higher through yesterday's session. S&P 500 ended 1.2% higher, Nasdaq 1.9% and Russel 2000 0.3% higher, driven by (yet again) tech and cyclical stocks. Qualcomm announced that they will start shipping their new AI chip next year and led the rally. Overnight, Asian markets are somewhat mixed with Nikkei down 0.4% and Shenzen 300 up 0.2%.

FI and FX: USD continued to weaken overnight, with EURUSD moving towards 1.1670 and USDJPY dropping below 152 as a readout from Scott Bessent's meeting with Japan's Katayama indicated that BoJ policy and exchange rate volatility were discussed, serving as a reminder that the US administration prefers a weaker dollar. US yields fell from late afternoon and the 10y UST is now back just below 4%. We expect the Fed to announce an end to QT in Treasuries at Wednesday's meeting, and as a rate cut of 25bp is widely expected, this could be a bigger market mover in our view. With cuts fully priced for both October and December, we think near-term risks for the USD remain asymmetrically tilted to the upside. EURSEK remains at the lower end of the recent 10.90-11.10 range and EURNOK has been mostly sideways since Friday afternoon in a 11.62-11.66 range.

Source: ACTIONFOREX