United States
US equities rallied on renewed optimism that the long-running federal shutdown might soon end, clearing the way for the return of official economic data and bolstering hopes for clarity about the Federal Reserve’s next move. The S&P 500 recovered losses late in the session as roughly 345 stocks advanced, while the Dow Jones Industrial Average rose about 1.2 per cent.
Key movers included FedEx Corporation, which climbed more than 5 per cent on stronger profit expectations, signalling resilience in freight and logistics. By contrast, Nvidia Corporation slipped about 3 per cent after SoftBank Group Corp. sold its entire stake (US$5.83 billion) in the chip-maker, as it reallocates capital toward artificial-intelligence initiatives.
With Treasury markets closed for Veterans Day, Treasury futures moved higher following the private ADP Research Institute release that signalled a slowdown in the US labour market in the latter half of last month. That private release is now standing in for missing government data.
In Washington, the Senate passed a temporary funding bill to end the shutdown now it’s in the hands of the United States House of Representatives. If approved, much of the government would remain open through to 30 January, with some agencies funded through to September. President Donald Trump has already signalled support.
Analysts noted that if the shutdown ends this week, the delayed September jobs report could be released next week, reminiscent of the 2013 pattern when the jobs data followed shortly after that shutdown’s resolution.
From a broader viewpoint, commentators are pointing to three core drivers: rate-cut hopes by the Fed, strong corporate profits (especially in AI and tech), and robust liquidity. One strategist at JPMorgan Market Intelligence summarised: “We are buyers of this dip and maintain our tactical bullish call.”
That said, while sentiment is upbeat, some caution is creeping in: big tech valuations are elevated and breadth remains thin, suggesting possible short-term consolidation even if the longer-term trend stays intact. The global backdrop is broadly supportive for risk assets, given optimism over the US government reopening, strong corporate earnings and rate-cut hopes. Locally, banks remain under scrutiny while commodity names continue to catch interest. The interplay of offshore drivers and domestic fundamentals will keep the market dynamic worth keeping an eye on as the day unfolds.
Europe
European markets also posted gains, reflecting strong earnings and heightened expectations that the Bank of England (BoE) could cut interest rates. The Stoxx Europe 600 Index rose about 1.3 per cent, while the FTSE 100 climbed roughly 1.1 per cent to a fresh record, bolstered by higher-than-expected UK unemployment. The FTSE MIB in Italy gained around 1.2 per cent, finally surpassing its pre-global-financial-crisis level.
Sector-wise, consumer products and healthcare outperformed in Europe, while personal care lagged. Swiss equities were a standout: the Swiss Market Index lifted about 2 per cent as Switzerland edged closer to securing a reduced US tariff on exports (15 per cent down from 39 per cent). In individual stock moves, Vodafone Group Plc jumped 8.3 per cent after returning to growth in Germany, and Fraport AG rose 6.5 per cent on a strong earnings beat.
Part of the lift in Europe came from the US shutdown-end narrative: investors are hoping the return of US economic data will reinforce global central-bank easing hopes. But strategists caution that while sentiment is buoyant, the catalyst may be short-lived without fresh follow-through.
Australia
Down under, the S&P/ASX 200 slipped 0.2 per cent to finish at 8818.8, weighed by a sharp fall at Commonwealth Bank of Australia (CBA). The bank tumbled 6.6 per cent after reporting a cash profit of AUD 2.6 billion for the September quarter — operating income grew 3 per cent but expenses rose 4 per cent due to higher wages and IT costs, and the net interest margin (NIM) was flagged as being under pressure.
Other major banks painted a mixed picture: National Australia Bank fell 1.3 per cent, while ANZ Group and Westpac Banking Corporation rose 0.5 per cent and 1.3 per cent respectively.
In contrast, materials moved higher gold miners and lithium plays led gains. Northern Star Resources advanced 3.2 per cent, Evolution Mining Ltd rose 1.7 per cent, and Newmont Corporation surged 4.3 per cent. Lithium names also caught a bid, Pilbara Minerals Ltd (PLS) was up 7.7 per cent and Mineral Resources Ltd rose 6 per cent, as spodumene prices reached their highest levels since June last year. Among other movers: Light & Wonder Inc surged 11 per cent following an upbeat quarterly update, while Bendigo and Adelaide Bank Ltd dropped 8.5 per cent after reporting a 3.2 per cent fall in quarterly unaudited cash earnings (AUD 120.7 m).
Looking ahead, the local market will take cues from the lead-in offshore, the domestic banks’ margin trajectories, and commodity-weight leverage all relevant for Australian investors.
Commodities and currencies
On the commodities front, oil and gold both advanced, US West Texas Intermediate (WTI) crude rose about 1.3 per cent to US$60.92 a barrel, while spot gold climbed around 0.3 per cent to US$4,128.45 an ounce. These moves reflect risk-on sentiment alongside some safe-haven demand.
In currencies, the US dollar was essentially flat; the euro ticked up by 0.2 per cent to US $1.1584, and the British pound held at US $1.3162. The Japanese yen was stable around 154.14 per dollar. Cryptocurrencies, meanwhile, remain under pressure: Bitcoin slipped about 2.7 per cent to US $102,734.2 and Ether fell roughly 2.9 per cent to US $3,437.05.
Bond markets in Europe softened slightly: Germany’s 10-year yield dropped one basis point to 2.66 per cent, the UK’s 10-year fell seven basis points to 4.39 per cent, and in the US the 10-year note futures rose 33 basis points to 113.02.
For Aussie investors, all of this ties into interest-rate expectations, commodity exposure and currency hedges factors that can amplify or mitigate offshore signals when they reach Australian shores.
Economic Calendar
No major data releases
This article was written by James Woods, Rivkin Securities Pty Ltd. Enquiries can be made via [email protected] or by phoning +612 8302 3632.
