This week, global equity markets were marked by heightened volatility as investors digested corporate earnings reports. Tensions between the U.S. and Russia resurfaced, while the possibility of further restrictions in U.S.-China trade added to market uncertainty. Commodity markets also experienced volatility, with gold and silver recording their largest single-day price drop in 12 years. Crude oil prices climbed amid expectations of increased demand. Additionally, expectations for a rate cut at next week’s Federal Reserve meeting intensified, following softer-than-expected consumer inflation data for September.

In global geopolitics, President Trump’s meeting with President Putin in Hungary was called off, followed by the imposition of new U.S. and E.U. sanctions on Russia. President Trump is scheduled to meet with President Xi Jinping on October 30 in South Korea. The U.S. federal government shutdown entered its fourth consecutive week. Sanae Takaichi was elected as Japan’s first female prime minister, after the Japan Innovation Party and the ruling Liberal Democratic Party formed a coalition government. Global leaders are expected to attend the ASEAN Summit in Kuala Lumpur over the weekend. President Trump also cancelled ongoing trade negotiations with Canada, citing the misuse of former President Ronald Reagan’s voice in an anti-tariff advertisement. Meanwhile, the U.S. plans to seek a United Nations mandate to establish a Gaza security force, following the resumption of the Israel-Hamas ceasefire after renewed hostilities on Sunday.

Global Updates
  • The MSCI All Country World Index advanced over the week as global markets absorbed mixed corporate earnings reports. Markets also tracked declines in U.S. equities, driven by concerns over renewed tensions in U.S.-China trade relations. Earlier this week, President Trump remarked on the unsustainability of current high tariffs on China and expressed optimism about the U.S.-China relationship.
  • The HCOB Flash Eurozone Composite PMI rose to 52.2 in October, while the Manufacturing PMI increased to 50.0, signaling an expansion in business activity for the month.
  • Retail sales in the U.K. are estimated to have grown by 0.5% in September, defying expectations of a contraction amid concerns of an economic slowdown.
  • A meeting is scheduled for October 30 in South Korea between President Trump and President Xi Jinping to address trade tensions ahead of the November 1 deadline for additional tariffs. Tensions have escalated with the introduction of port fees and export restrictions on rare earths and technology.
  • Newly elected Japanese Prime Minister Sanae Takaichi is expected to announce an economic stimulus package to support households in managing inflation. Takaichi is also expected to adopt a dovish policy stance, paving the way for monetary and fiscal easing.
  • SoftBank announced plans to issue $2 billion in U.S.-dollar-denominated bonds and €750 million in hybrid notes, while also planning to expand its investments in artificial intelligence.
  • Canadian Prime Minister Mark Carney is scheduled to meet with Chinese President Xi Jinping next week to discuss enhancing bilateral trade relations and mitigating the impact of U.S. tariffs.
  • The Kospi Index rose on optimism surrounding the potential finalization of a U.S.–South Korea trade agreement, ahead of the APEC Summit in South Korea next week.
  • The U.S. and India are nearing a trade agreement, conditional on India reducing its imports of Russian crude. Indian refiners have begun discussions with Middle Eastern suppliers to secure alternative sources of crude oil.
  • U.S. sanctions on Lukoil and Rosneft have contributed to a rise in crude oil futures. Earlier this week, oil prices climbed after the U.S. Department of Energy announced plans to replenish the Strategic Petroleum Reserve.
  • The year-long rally in gold prices experienced a sharp pullback, with the largest single-day drop in gold and silver prices in 12 years. However, gold futures rebounded later in the week, supported by new sanctions on Russian entities. The underlying structural drivers of safe-haven demand for precious metals remain intact.
U.S. Equity
  • The S&P 500, Dow Jones, and Nasdaq indices experienced heightened volatility this week as investors digested earnings reports, shifts in trade policy, and the anticipated release of the CPI inflation report. Earlier in the week, U.S. markets gained ground following mixed earnings results. However, the breakdown in U.S.-Russia negotiations and the possibility of new restrictions on software exports to China led to a midweek decline. Markets rebounded later in the week as additional earnings reports were released.
  • The U.S. Bureau of Labor Statistics (BLS) reported a softer-than-expected Consumer Price Index (CPI) inflation rate of 3% for September. Markets now anticipate a potential rate cut at next week’s Federal Reserve meeting.
  • The U.S. Supreme Court is facing funding constraints, and essential personnel such as law enforcement officers and air traffic controllers are being required to work without pay, as the federal government shutdown entered its fourth week.
  • Intel reported a better-than-expected third quarter earnings per share (EPS) of $0.23, supported by a 3% revenue increase to $13.7 billion. The company has raised its fourth-quarter revenue forecast to a range of $12.8 billion to $13.8 billion.
  • Procter & Gamble reported a stronger-than-expected adjusted EPS of $1.99 and a 3% increase in sales, reaching $22.39 billion for the fiscal first quarter of 2026.
  • Tesla posted a lower-than-expected third-quarter EPS of $0.50, despite reporting higher-than-estimated revenue of $28.10 billion and free cash flow of $3.99 billion.
  • Netflix’s third-quarter earnings fell short of expectations, with an EPS of $5.87 on revenue of $11.51 billion. The earnings miss was attributed to expenses related to a Brazilian tax dispute.
  • American Airlines posted a smaller-than-expected adjusted quarterly loss of $0.17 per share, on a 0.3% increase in revenue to $13.69 billion.
  • West Pharmaceutical Services’ stock rallied after the company reported an adjusted EPS of $1.96 for the third quarter, supported by a 5% revenue increase to $805 million.
  • IBM reported lower-than-expected third-quarter software revenue of $7.21 billion, with total revenue reaching $16.33 billion, and an adjusted EPS of $2.65.
  • Intuitive Surgical posted a better-than-expected third quarter adjusted EPS of $2.40, driven by 23% revenue growth to $2.51 billion. The company also revised its full-year revenue growth outlook upward to a range of 17% to 17.5%.
  • Barclays’ stock surged following the announcement of a $670 million share buyback program and an upward revision of its full-year profit and performance targets.
Fixed Income
  • The Bloomberg U.S. Aggregate Bond Index declined slightly over the week.
  • The U.S. 10-year Treasury yield declined to 3.989%. On the other hand, the yield on the 2-year note rose to 482% over the week.
  • The U.S. Dollar Index rose this week to 98.91 initially rising due to the U.S.-China trade tensions and later settling down after September’s CPI inflation was lower-than-expected.

HCM-030624-063.GWS