Global markets continued to decline over the past week amid concerns of a potential bubble in AI related technology stocks. Equity markets globally mirrored the downturn in U.S. markets, primarily due to a pullback in technology stocks. However, strong third-quarter earnings reported by Nvidia temporarily eased investor fears and provided a brief boost to broader market sentiment. Meanwhile, stronger-than-expected employment data for September, coupled with hawkish commentary from policymakers, reduced expectations of a rate cut in December.

On the geopolitical front, the United States and Saudi Arabia finalized a security agreement designating Saudi Arabia as a major non-NATO ally. The agreement grants Saudi Arabia access to advanced U.S. defense technology, including F-35 fighter jets and Nvidia chips. Additionally, Crown Prince Mohammed bin Salman pledged to invest $1 trillion in the United States. In Canada, Parliament passed Prime Minister Mark Carney’s inaugural budget, averting the risk of snap elections. Tensions between China and Japan resurfaced over Taiwan-related issues. In the U.S., President Trump signed legislation approving the release of the Epstein files. President Trump also lowered tariffs on imported foods.

Global Updates
  • The MSCI All Country World Index declined over the week, reflecting weakness across global equities.
  • Switzerland finalized a trade agreement with the United States, reducing U.S. tariffs from 39% to 15%.
  • Shares of Swedish aerospace company Saab rallied following the announcement of a $3.6 billion deal with the Colombian government for 17 Gripen fighter jets.
  • London-based HSBC is restructuring its capital markets business to strengthen its debt financing division.
  • The Canadian Parliament averted snap elections by passing Prime Minister Mark Carney’s deficit-heavy first budget, which includes a stablecoin policy overseen by the Bank of Canada.
  • Airbus stock surged after securing a $24 billion deal with budget carrier flydubai for 150 jets, with an option for 100 additional aircraft.
  • ByteDance’s valuation rose to $480 billion following a successful auction of its shares.
  • Anticipation of a large stimulus package from Japanese Prime Minister Takaichi pushed long-term borrowing costs higher. Yields on 10-year and 30-year Japanese Government Bonds reached 1.75% (highest since 2008) and 3.32% (record high since issuance), respectively. Japanese equities attracted foreign inflows of ¥1.02 trillion, primarily into technology stocks.
  • Gold ended the week lower amid reduced expectations of a December rate cut.
  • Crude oil prices declined due to interest rate uncertainty and expectations of increased supply, following President Zelenskiy’s willingness to negotiate a Russia–Ukraine peace deal ahead of the U.S. sanctions deadline on Russian energy (November 21).
U.S. Equity
  • Investors pulled back from U.S. equities during the week, reflected in declines across the S&P 500, Dow Jones, and Nasdaq. The retreat from technology stocks drove a broader market downswing, though Nvidia’s stellar returns briefly reversed the trend. Investor concerns remain elevated over overstretched valuations, technology depreciation, and circular deal structures. Amazon founder Jeff Bezos also advised consumers to postpone major purchases, citing the potential risk of an economic recession.
  • The U.S. economy added 119,000 non-farm jobs in September, while the unemployment rate rose to 4.4%, its highest level in 47 months, according to the Bureau of Labor Statistics. Strong labor market data and hawkish commentary in the Fed minutes have reduced the likelihood of a December rate cut to below 50%.
  • Nvidia CEO Jensen Wang dismissed fears of an AI bubble after the company reported an adjusted EPS of $1.30, beating expectations, on revenue growth of 62% to $57 billion in the fiscal third quarter. Nvidia also raised its fourth-quarter revenue outlook to $65 billion, driven by growing AI demand for Rubin and Blackwell architectures.
  • Alphabet shares rallied earlier in the week following Berkshire Hathaway’s $4.9 billion investment in the company. Positive feedback on the performance of Gemini 3 further supported the rally.
  • Walmart reported an adjusted EPS of $0.52, beating estimates, on 5.8% revenue growth to $179.5 billion in the third quarter. Sales rose 4.2%, e-commerce grew 27%, and advertising revenue surged 53%. The retailer raised its full-year revenue growth outlook to 5.1% and adjusted EPS guidance to the $2.58–$2.63 range.
  • Anthropic’s valuation climbed to $350 billion following strategic investments of $5 billion by Microsoft and $10 billion by Nvidia. Azure committed to purchasing 1 gigawatt of computing capacity in Nvidia systems and $30 billion of Microsoft’s computing capacity in Azure.
  • The U.S. government extended a $1 billion loan to Constellation Energy to restart the nuclear reactor at Three Mile Island to meet the rising energy demand.
  • Home Depot posted third-quarter adjusted EPS of $3.74, missing estimates, on revenue of $41.35 billion. The company lowered its full-year earnings outlook by 5%, citing expectations of reduced consumer spending.
  • Lowe’s reported an adjusted EPS of $3.06, beating expectations, on third-quarter revenue of $20.81 billion. However, the company revised its full-year profit outlook downward due to economic slowdown concerns.
  • Target announced a collaboration with OpenAI to attract customers and reverse declining sales. Third-quarter sales fell 1.5% to $25.3 billion, leading to a 3.9% decline in diluted EPS. The retailer also lowered its full-year profit guidance.
  • Boeing signed a provisional agreement with flydubai for 75 of its 737 Max jets, valued at $13 billion.
  • Microsoft and Amazon expressed support for the GAIN AI Act, which aims to prioritize domestic order fulfillment and restrict the export of AI chips to China.
Fixed Income
  • The Bloomberg U.S. Aggregate Bond Index declined over the week.
  • The U.S. 10-year Treasury yield declined to 4.061% and the yield on the 2-year note edged lower to 516% over the week.
  • The S. Dollar Index rose to 100.22 this week due to the decreasing probability of a December rate cut and a falling Yen.

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