- The US2000 is up more than 1.6% today, reaching new all-time highs. The US100 is gaining around 0.7%, while the US500 is up 0.8%. As expected, the Fed cut interest rates and announced a technical QE program aimed at managing reserves. It also slightly lowered its PCE inflation projection, which the market welcomed.
- The Fed left its rate-path forecasts unchanged, yet Powell’s clear remarks about the deterioration in labor-market conditions opened the door to additional cuts. At the same time, the Fed did not raise its unemployment forecast, made only minor downward tweaks to its inflation projections, and significantly lifted its GDP growth outlook for next year.
- EURUSD is reacting to Powell’s dovish tone, with the pair approaching the 1.1700 level. Gold appears to be breaking out of its downward consolidation, testing the $4,238 per-ounce area today.
- On the macro side, US labor costs (October) came in at 2.8% vs2.9%exp. and 2.9% previously. Futures strengthened notably during Jerome Powell’s press conference following the Fed’s decision.
- Kevin Hassett noted that President Trump should decide on the next Fed Chair within the next 1–2 weeks. Hassett is reportedly among the leading candidates and argues that the economy needs even deeper rate cuts.
- Cocoa prices rebounded 6% today and have now recovered more than 25% from the recent low amid reduced oversupply projections.
- The Bank of Canada kept interest rates unchanged and signaled no expectation of policy adjustments in the near term, citing solid positioning against inflation and tariff-related risks.
- Nvidia shares traded higher today on reports of potential large orders from ByteDance and Alibaba. At the same time, JPMorgan suggested that Chinese companies may not generate strong demand for H200 chips even if Trump authorizes such exports.
- Photronics also stood out in the equity market; the semiconductor photomask producer surged over 40% after upbeat guidance and strong fiscal Q3 results, with earnings per share beating expectations by more than 30%.
- Crude oil extended its decline despite a drop in DOE-reported inventories, as the market grows more confident about supply. US crude stocks fell by 1.8 million barrels, but inventories of refined products increased sharply.
- Wheat and corn prices fell after yesterday’s USDA WASDE report. In corn’s case, a decline in inventories triggered only a short-lived spike.
- Bitcoin gained nearly 0.5% today, climbing back above $93,000, supported by a weaker dollar and strong sentiment on Wall Street, which rallied almost immediately after the Fed’s rate announcement.
- Inflation in China came in below expectations. November CPI printed at -2.2% y/y versus the expected -2.0% y/y.
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