Global markets ended the week on a positive note, buoyed by the Federal Reserve’s (Fed) third consecutive rate cut and optimism around global trade. U.S. equities hit record highs. Commodity markets were mixed—gold and silver rose on a weaker dollar and inflation concerns, while crude oil fell on expectations of oversupply amid Russia-Ukraine peace prospects. Central banks in Switzerland and Canada held rates steady, citing contrasting economic conditions. In corporate news, Oracle disappointed on earnings while Broadcom surged on strong AI chip sales. China’s trade surplus crossed $1 trillion, the U.K. posted its largest trade deficit.  

On the geopolitical front, President Trump criticized Ukraine’s peace efforts and hinted at withdrawing U.S. support, as the Russia-Ukraine conflict continues over territorial disputes. Trump also announced a $12 billion aid package to compensate farmers for trade-related losses. In the Middle East, Israel proposed Hamas disarmament under the U.S. peace plan, countering Hamas’s call for a weapons freeze. Meanwhile, renewed tensions between Thailand and Cambodia triggered political instability, culminating in the dissolution of Thailand’s parliament.

Global Updates
  • The MSCI All Country World Index rose during the week, closely tracking the U.S. equity markets and supported by the Fed’s interest rate cut and indications of resurgence in international trade.
  • The Swiss National Bank kept its policy rate unchanged at 0%, citing November inflation of 0% and weak third-quarter economic growth. The Swiss franc’s appreciation, driven by safe-haven demand, has added deflationary pressure on exports. 
  • The Bank of Canada held its policy rate unchanged at 2.25% citing a resilient economy which added 181,000 jobs between September to November and posted a GDP growth of 2.6% in the third quarter. 
  • The United Kingdom reported a higher trade deficit of £22.54 billion in October-the highest since January 2022-the highest since January 2022- driven by a 0.8% decline in exports to £30.96 billion. The British economy also contracted by 0.1% mom in October due to underperformance of the services sector.
  • Eli Lilly’s next-generation obesity drug, Retatrutide, showed promising results in a late-stage trial, highlighting its potential to significantly benefit patients with obesity and arthritis. 
  • Shareholders of Anglo American and Teck Resources have approved their merger, paving the way for the creation of one of the world’s top five copper producers. The deal now awaits clearance from U.K. regulators.
  • China’s trade surplus surpassed $1 trillion for January–November, supported by 5.4% export growth. November exports rose 5.9%, lifting the monthly trade surplus to $112 billion despite a 29% drop in shipments to the U.S. 
  • Gold and Silver prices rose over the week due to the U.S. Fed rate cut in an potentially inflationary environment and the decline in the U.S. dollar.   
  • Crude oil futures declined over the week amid expectations of a global surplus, driven by prospects of a Russia-Ukraine peace deal following the Trump administration’s threat to withdraw support for Ukraine. A Ukrainian drone strike on a Russian oil rig did not derail negotiations. The International Energy Agency continues to forecast oversupply, citing global inventories at a four-year high.
U.S. Equity
  • U.S. equity markets advanced this week, driven by the Fed’s third consecutive rate cut, with the S&P 500 and Dow Jones reaching record highs at 6,900 and above 48,700, respectively. The Nasdaq also gained, though Oracle’s earnings tempered its performance. The Fed lowered its policy rate by 25 bps to a 3.50%–3.75% range in a split decision and projected one additional cut in 2026. Chair Jerome Powell described the economy as facing a “challenging situation,” citing a soft labor market and inflationary pressures from tariffs, and warned that prioritizing employment could heighten inflation risks. AI related technology stocks have declined this week, indicating a potential rotation out of technology stocks. 
  • Inflation is forecast at 3.0% and unemployment at 4.5% by end-2025, easing to 2.5% and 4.4%, respectively, in 2026.
  • Labor market data signaled weakness with weekly jobless claims surging by 44,000 to 236,000—the largest increase in eight months—for the week ended December 6. Job openings rose to 7.7 million in October per JOLTS data, but layoffs climbed to 1.85 million, the highest since January 2023.
  • The U.S. trade deficit narrowed 10.9% in September to a five-year low of $52.8 billion, as exports grew 3.0% to $289.3 billion, offsetting a 0.6% rise in imports to $342.1 billion. 
  • JPMorgan Chase shares lagged after projecting 2026 expenses of $105 billion, driven by investments in AI and competition in credit cards and community banking.
  • Oracle reported an EPS of $2.26 in its fiscal second quarter on a lower than expected revenue of $16.06 billion. Oracle reported $7.98 billion in cloud revenue, $4.1 billion in cloud infrastructure revenue and a 3% lower software revenue of $5.88 billion for the quarter that ended Nov. 30. Oracle’ stock price however declined due to investors’ concerns for rising debt and AI investments and, a negative cash flow of $10 billion in November. 
  • Broadcom reported higher than expected fourth-quarter EPS of $1.95 and revenue of $18.02 billion. Broadcom also projected a higher than estimated 28% growth in its first quarter fiscal revenue to $19.1 billion driven by a 100% growth in its AI chips sales to $8.2 billion.
  • Walmart has transferred its primary listing from the New York Stock Exchange to the Nasdaq to enhance the company’s perception as a technology driven e-commerce company.
Fixed Income
  • The Bloomberg U.S. Aggregate Bond Index rose over the week.
  • The U.S. 10-year Treasury yield declined to 4.14% and the yield on the 2-year note edged lower to 3.53% over the week. Treasury yields declined this week with Fed’s rate cut and announcement of purchases of $40 billion in short-term securities, while strong demand for a $22B 30-year bond sale reinforced the move.
  • The U.S. Dollar Index declined to 98.48 over the week.

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