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The end of the week brings no relief to financial markets. Despite several attempts to rebound, bears dominated this week, mainly due to geopolitical uncertainty, fears of an AI bubble, and the hawkish stance of Fed officials.
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At the moment of publication, U.S. indices are attempting to recover losses. The US500 is up 0.90% and the US100 is up 0.70%. The strongest gains come from small-cap companies — the US2000 index is rising 2.30%.
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This week has been particularly tough for tech stocks. The US100 is down 3.55% on a weekly basis, and at the peak of today’s selloff, the decline reached nearly 4.80%.
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Eli Lilly (LLY.US) officially joined the elite group of U.S. companies valued at over 1 trillion dollars today, becoming the tenth American company in this group.
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The BLS announced that the Employment Cost Index release for Q3 will take place on December 10. The report on real earnings for October has been canceled, and the CPI release for November will be published on December 18.
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Preliminary PMI data from the U.S. showed an overall solid picture: manufacturing fell to 51.9 (vs expected 52.0, prior 52.5), while the composite index remained at 54.8 (54.6 previously).
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Chris Williamson from S&P Global noted that the data point to roughly 2.5% annualized GDP growth in Q4, supported by rising output in both manufacturing and services and stronger business confidence.
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John Williams from the Fed confirms that monetary policy is “modestly restrictive” and believes there is room for more cuts in the short term, despite rising inflation pressures. Williams indicates that tariffs add 0.5% to 0.75% to inflation, which does not change the fundamental direction — cuts remain justified to support a labor market threatened by slowdown.
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The odds of a rate cut at the December meeting have already surged to over 73%, up from 38% just yesterday.
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University of Michigan data came in better than expected. Inflation expectations fell to 4.5% (1-year) and 3.4% (5-year), while consumer sentiment rose to 51 (Expected: 49; Previous: 50.3).
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The cryptocurrency market stands out with declines. Today alone, Bitcoin lost over 4.50% after testing the 80,000 USD level. Ethereum is down 4.70%. The selloff is driven by a mix of factors: a liquidity crunch, panic about the end of the cycle, long-term investors selling, and negative sentiment in the equity market.
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MicroStrategy’s preferred shares lost nearly 7.0% this week and 13.5% this month as crypto-market sentiment worsened. As a result, the decline in preferred shares raises questions about the company’s ability to continue financing Bitcoin purchases and covering cash-paid dividend obligations.
Three market to watch next week (21.11.2025)
BREAKING: UoM report suggests a decline in inflation expectations 📌
BREAKING: US PMI beats expectations slightly; EURUSD with no reaction 📌
BREAKING: Mixed results for the UK PMI index. GBPUSD muted
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