United States
Fresh evidence of cooling in the US jobs market strengthened expectations that the Federal Reserve will cut interest rates at its final policy meeting of the year, lifting equities and sending bond yields and the US dollar lower. Private-sector payrolls fell by 32,000 in November, the largest decline since early 2023. Services activity expanded modestly, while a measure of prices paid eased to a seven-month low, reinforcing the view that inflationary pressures are stabilising and that a softer labour market is now at the centre of the Fed’s thinking.
Almost 350 stocks in the S&P 500 rose, although some large technology names lagged. Microsoft slipped 2.5 per cent after reports of reduced demand for certain artificial-intelligence offerings, while Nvidia was softer on uncertainty over whether China would accept the firm’s H200 chips should US export restrictions be relaxed. After hours, Salesforce issued a solid revenue outlook, while Snowflake’s margin forecast underwhelmed.
Treasury yields declined across the curve, with the two-year easing below 3.5 per cent as investors priced in more than a 90 per cent probability of a 25-basis-point cut next week. The greenback had its weakest session since September, while Bitcoin hovered near USD 93,000. Broader asset moves reflected the shift in rate expectations: the S&P 500 rose 0.3 per cent to approximately 6,850, the Dow gained 0.9 per cent, and the Nasdaq added 0.2 per cent. Smaller companies outperformed, with the Russell 2000 up 1.9 per cent.
While the weaker payrolls reading and subdued price indicators supported the rally, the broader question remains how far and how quickly policy easing will progress next year. Recent data suggest that labour conditions, while softening, are not collapsing, and consumer resilience is still evident. However, long-dated US yields continued to fall, setting up Treasuries for their best annual performance since 2020 as the duration trade benefits from the shift in policy expectations.
Corporate activity was lively. US regulators progressed on several deals, including Constellation Energy’s planned acquisition of Calpine Corp. There were notable sector developments too: Intel scrapped plans for a network-unit divestment, Meta secured a senior Apple design executive, and the London Stock Exchange Group reached an agreement for access to licensed financial data. TikTok announced major investment in Latin America, while litigation and restructuring stories emerged across industrials, fashion, and Chinese property.
Europe
European equities ended marginally higher, buoyed by resilient corporate earnings and improving economic trends, though sentiment was tempered by weakness in US megacaps. The Stoxx 600 rose around 0.1 per cent after earlier gains of up to 0.5 per cent. Technology-exposed industrials such as Legrand, ABB, and Schneider Electric finished lower, aligned with the cautious tone in US tech. By contrast, retail stocks outperformed, led by an 8.9 per cent surge in Inditex after stronger November sales.
Defence companies firmed as geopolitical talks between the US and Russia failed to progress, while the insurance sector lagged. Regional indices remain close to record highs, supported by steady earnings and improving growth indicators, with Spanish and Italian stocks among Western Europe’s strongest performers this year thanks to bank-sector strength.
Corporate news saw significant swings. Hugo Boss fell 10 per cent after flagging lower sales and earnings in 2026 ahead of an expected recovery, while Stellantis jumped nearly 8 per cent on an upgraded analyst outlook. Broader European sentiment also reflected attention to upcoming monetary policy decisions in the US and euro area, with investors alert to how slowing US job growth may influence the direction of global policy settings.
Australia
The local market drifted modestly higher, taking its cues from Wall Street’s rate-cut optimism and a softer showing in domestic GDP. The S&P/ASX 200 rose 0.2 per cent to 8,595.2, having initially climbed as much as 0.5 per cent after data showed the economy expanded just 0.4 per cent in the September quarter. While still positive, the result fell short of expectations and briefly eased pressure on the Reserve Bank of Australia, with bond markets lowering expectations of an earlier rate hike.
Real estate shares led the advance, with Vicinity, Scentre, and Stockland all higher, followed by utilities, helped by a strong move in AGL. Bank performance was mixed: ANZ rose 1.5 per cent, Westpac gained 0.8 per cent, NAB climbed 0.7 per cent, while Commonwealth Bank edged lower. Miners posted a mixed result as well, with BHP and Rio Tinto slightly firmer, while Fortescue dipped on news that major producer Vale revised its 2026 iron ore output forecast lower.
Technology stocks failed to mirror the rebound seen in US markets, despite renewed enthusiasm in cryptocurrencies. Block retreated 6 per cent, Megaport fell 6.3 per cent, and Life360 declined, though WiseTech was a standout, rallying 4.5 per cent after outlining a new pricing model. Corporate updates also supported selective moves: Betmakers surged on digital-wagering strength, 4DMedical jumped on expanded distribution, and Vulcan Energy secured sizeable financing for development of its lithium and energy project.
Ahead of today’s trade balance figures at 11.30am, ASX futures suggest a mildly positive open. The Australian dollar strengthened to 65.96 US cents, while futures reflected modest support from global equities as traders locked in Fed-cut expectations.
Commodities and currencies
The US dollar weakened 0.3 per cent in its sharpest daily move since September, as markets accelerated bets on US policy easing. The euro and pound both strengthened, while the yen gained against the dollar as falling bond yields created a more favourable backdrop for lower-yielding currencies. Bitcoin rose around 1.5 per cent and Ether almost 5 per cent.
Energy and metals traded firmer. West Texas Intermediate crude rose 0.8 per cent to about USD 59 a barrel, while Brent oil nudged higher towards USD 63. Iron ore traded near USD 104 a tonne. Gold was little changed near USD 4,200 an ounce. Government bond yields drifted lower across major economies, with US, UK and Australian 10-year benchmarks all softer.
Economic Calendar
EU:
- Retail Sales (MoM) 21:00
US:
- Initial Jobless Claims 00:30
This article was written by Calvin Curdie, Rivkin Securities Pty Ltd. Enquiries can be made via [email protected] or by phoning +612 8302 3632.
