Global equity markets rose slightly over the week, despite a massive selloff on Thursday. Earlier in the week, expectations of an end to the government shutdown initially buoyed the markets. The Dow Jones index also crossed the 48,000 benchmark earlier in the week but lost 800 points on Thursday. Fears of a market correction drove investors out of tech stocks. The diminished possibility of a rate cut at the Federal Reserve’s (Fed) December meeting also weighed on investor sentiments. 

In global geopolitics, the record-breaking 43-day U.S. government shutdown ended after the House of Representatives passed a bill funding the federal government through January 2026. Earlier in the week adverse weather conditions and a shortage of air traffic controllers had caused disruptions and delays to more than 10,000 flights across the United States. In Canada the opposition Conservative Party lost two of its Members of Parliament to resignation and defection, ahead of the upcoming budget vote on November 17. In the UK Health Secretary Wes Streeting has dismissed the public speculations of any plans to challenge Prime Minister Keir Starmer’s leadership.

Global Updates
  • The MSCI All Country World Index posted modest gains over the week, mirroring the rise and subsequent pullback in U.S. equity markets. International investors were initially encouraged by the announcement of a one-year suspension of port fees between the U.S. and China on each other’s shipping fleets. However, later in the week, growing concerns about a potential bubble in AI-related stocks weighed on global sentiment. 
  • In the UK, the ILO unemployment rate rose to 5% for the three-month period ending September, which is the highest unemployment rate since the COVID-19 pandemic.
  • Great-West Lifeco is in the process of consolidating its European subsidiaries into Keyridge Asset Management, which will have $185 billion in assets under management.
  • The Canadian economy added an estimated 67,000 jobs in October, surpassing expectations, while the unemployment rate declined to 6.9%. Job growth was primarily driven by part-time positions, as full-time employment contracted. Additionally, the average hourly wage increased by 4% during the month.
  • Japanese Prime Minister Sanae Takaichi’s preference for low interest rates led to a decline in the Yen. 
  •  The International Energy Agency has projected a 13% growth in global crude oil demand which is expected to reach 113 million barrels per day by 2050.
  • Gold and silver prices posted weekly gains despite a mild pullback following the U.S. government reopening. 
  • Oil prices ended the week lower due to the decline induced by fears of a supply glut. However, prices rose following the Ukrainian drone attack on Novorossiysk. The supply risks from the upcoming sanctions against Lukoil also concerned investors.
U.S. Equity
  • The S&P 500, Dow Jones, and Nasdaq indices posted gains earlier in the week, with the Dow Jones surpassing the record 48,000 mark on Wednesday. However, markets retreated on Thursday amid concerns over a potential AI-driven bubble and diminishing expectations of a December rate cut. The Dow fell by 797 points, while the Nasdaq declined sharply by 2.3% in a single session. Goldman Sachs’ Chief Strategist Peter Oppenheimer also suggested the global equity markets will outperform the U.S. equities over the coming decade. Investor sentiment was further dampened by cautionary remarks from Goldman Sachs CEO David Solomon regarding an AI bubble and Ray Dalio’s warning about the escalating national debt, which has now exceeded $38 trillion. Additionally, the U.S. House of Representatives passed a funding bill to end the 43-day government shutdown. The bill will keep the government funded through January 2026. 
  • Policymakers at the Federal Reserve have expressed concerns about the inflationary risks associated with a potential December rate cut, particularly given the continued stability in the labor market. The absence of labor market data, which was discontinued during the recent government shutdown, is also expected to obfuscate the estimated impact of a rate cut. However, the ADP payroll data has estimated a loss of more than 11,000 jobs over the four-week period ending October 25th. 
  • Nvidia CEO Jensen Huang has requested TSMC to increase the supply of AI chip components including wafers to meet the exponential growth in the demand for its Blackwell AI chips. Nvidia stock declined in the week due to the offloading of Nvidia stock by SoftBank.
  • The U.S. travel industry is estimated to have lost $5.7 billion in revenues due to the decline in Canadian tourists to the U.S. since the U.S.-Canada political frictions began earlier in the year.
Fixed Income
  • The Bloomberg U.S. Aggregate Bond Index declined following an initial rise over the week.
  • The U.S. 10-year Treasury yield rose to 4.111% and the yield on the 2-year note rose to 3.589% over the week. 
  • The U.S. Dollar Index edged lower to 99.26 this week due to diminishing likelihood of a rate cut in December.

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