United States
Wall Street extended its record-setting run overnight, powered once again by gains in major technology names as investors awaited key earnings from the Magnificent Seven. The S&P 500 climbed 0.2% to close just shy of 6,900, the Nasdaq 100 added 0.7%, and the Dow rose 0.3%. The rally pushed US equities to fresh all-time highs, with optimism surrounding artificial intelligence continuing to underpin sentiment.
Microsoft surged after formalising a long-negotiated agreement with OpenAI, securing a 27% ownership stake reportedly valued at around USD 135 billion. The deal helped the software giant reclaim a USD 4 trillion market capitalisation. Nvidia also advanced, unveiling new technology to link its AI chips with quantum computing systems and announcing a USD 1 billion investment in Nokia to accelerate the Finnish group’s AI ambitions. Apple briefly joined the USD 4 trillion club before easing slightly into the close.
Market momentum remains concentrated among the tech titans, which together make up roughly a quarter of the S&P 500. Traders are positioning for a flood of corporate results over the coming days, including Microsoft, Alphabet, and Meta Platforms, seeking confirmation that multi-billion-dollar AI investments continue to yield earnings growth. The Magnificent Seven are expected to post profit growth of 14% this quarter (nearly double the broader index’s rate), though analysts caution that valuations leave little room for disappointment.
Elsewhere, economic focus remained on the Federal Reserve’s policy meeting later this week. Investors increasingly expect the Fed to halt its balance sheet unwind, ending quantitative tightening to ease liquidity pressures in funding markets. The 10-year Treasury yield held steady near 3.97%, while the US dollar slipped modestly as traders positioned for possible policy shifts.
Corporate highlights included Visa’s stronger-than-expected quarterly results, Booking Holdings beating estimates on travel demand, and PayPal lifting its full-year guidance alongside an integration with OpenAI’s ChatGPT platform. UnitedHealth nudged its outlook higher after a challenging year, while Tesla said it is ready to appoint an internal successor should Elon Musk depart amid debate over his USD 1 trillion pay proposal.
Europe
European markets eased from recent highs, with the Stoxx 600 down 0.2% as mixed earnings dampened risk appetite. Novartis slumped 4.2%, its worst session since April, after disappointing results reignited concerns about generic drug competition. BNP Paribas fell to a six-month low as weakness in its trading division offset gains elsewhere in the banking sector.
In contrast, Nvidia’s USD 1 billion investment in Nokia sparked a 21% rally in the Finnish telecommunications firm, lifting the entire telecoms sector. Deutsche Telekom gained after announcing a €1 billion data centre partnership with Nvidia, and Vodafone rose 4.4%. Industrials and consumer stocks, however, lagged, with Schneider Electric, Adidas, and L’Oréal all softer ahead of upcoming results.
Utilities outperformed, buoyed by Iberdrola’s 2.9% jump to record highs after the Spanish energy giant upgraded its outlook, while Nordex soared 23% as it lifted margin targets, providing a boost to renewable energy peers such as Vestas. Meanwhile, the chemicals sector came under pressure after Symrise cut its growth forecast.
Across the broader continent, investors weighed signs of slowing momentum against optimism over AI-linked dealmaking and resilient earnings in key industries. Energy shares were mixed as Brent crude slid more than 2%, reflecting renewed concerns of oversupply following last week’s sanctions-driven rally.
Australia
Australian shares are poised to open slightly higher, with ASX 200 futures up 0.1% to 9041. The positive lead from Wall Street’s tech rally is expected to support local sentiment, even as traders brace for a critical inflation reading later this morning. Third-quarter CPI data due at 11:30am will be pivotal for Reserve Bank policy expectations, with markets pricing around a two-thirds chance of a November rate cut.
The local earnings calendar remains active. Medibank Private will host its investor day, where it plans to outline ambitions to boost health segment earnings by AUD 200 million by FY2030. The insurer aims to engage 10 million Australians in wellbeing programs and lift policyholder market share to 26.8%, emphasising prevention and community health initiatives.
Ansell lifted its FY26 earnings guidance, citing improved sales momentum, cost reductions, and favourable currency movements. The company’s shares are likely to benefit from the upgrade, which lifted expected adjusted EPS to between US137¢ and US149¢. Helia Group reaffirmed its commitment to Australia’s lenders mortgage insurance market, while cutting operating costs by AUD 15 million amid subdued demand linked to the government’s deposit scheme.
Among miners, Arafura Rare Earths was in focus after Australia’s richest person doubled their stake in the company as it launched a AUD 475 million placement to fund its rare earths project. Austal guided to FY EBIT of AUD 135 million, and Macquarie Asset Management committed USD 450 million to a gas turbine project in Texas.
The ASX closed 43 points lower on Tuesday at 9,012.5, led by declines in CSL and WiseTech Global, both now trading below key moving averages. However, sentiment is expected to stabilise today on the back of stronger ADR performance in BHP and Rio Tinto overnight.
Commodities and currencies
Commodity markets were broadly weaker. Gold fell 0.7% to USD 3,954 an ounce as risk appetite remained firm, while oil prices extended losses with Brent down 2.2% to USD 64.23 a barrel and WTI at USD 59.93. The pullback reflected rising inventories and fading geopolitical risk premiums after recent supply disruptions. Copper held near record highs around USD 11,000 per tonne amid supply constraints in South America, though traders await confirmation of a potential US–China trade deal that could further lift demand.
In currencies, the Australian dollar strengthened 0.4% to US65.85¢, tracking firmer commodity-linked peers and easing US yields. The euro was steady at USD 1.1653, while the yen edged higher to 152.08 per dollar. Bitcoin slipped nearly 2% to USD 112,500 as risk appetite shifted toward equities.
Bond markets were mixed: the Australian 10-year yield eased to 4.17%, while the US equivalent held at 3.97%. The RBA’s upcoming CPI release and global rate outlook are expected to guide near-term movements in local yields.
Economic Calendar
AU:
- CPI YoY 11:30
- CPI QoQ 11:30
US:
- MBA Mortgage Applications Oct 22:00
- Wholesale Inventories MoM Sep 23:30
- FOMC Rate Decision 05:00
This article was written by James Woods, Rivkin Securities Pty Ltd. Enquiries can be made via [email protected] or by phoning +612 8302 3632.
