Futures point to a higher opening in Europe (Euro Stoxx 50 +0.9%) slightly weaker in the US after closing yesterday near the day's highs with the Nasdaq recording its best day since June and the S&P its strongest session since March (S&P 500 +0.2% and Nasdaq down -0.1%). Market rises continue to reflect a positive sentiment surrounding the outcome of the war between the US and Iran. In the background, Trump’s statements about a possible solution, mentioning the “push towards the end” of the conflict after meeting with the Prime Minister of Qatar following the resumption of negotiations between Washington and Tehran, where the release of Tehran's frozen assets, the reduction of uranium enrichment levels, and the return of international nuclear inspectors to the country would be discussed.
Despite this, tensions remain high, oil tankers continue to be targeted in the Strait of Hormuz, and US forces have reportedly launched another attack against the Iranian island of Qeshm. Additionally, US Secretary of State Marco Rubio moderated expectations for progress in the negotiations.
However, the market's perception of a possible end to the war was again reflected in crude behaviour, with WTI dropping 4.4% and Brent c.-6% (the lowest level since August, futures -1.8% below $91/b) and -21.3% in November. While the market awaits the monthly reports on the oil market from the US Energy Information Administration (EIA), OPEC, and the International Energy Agency (IEA).
With this underlying optimism, today the key reference for the session is in the US with the October CPI for which moderation is expected both in the overall rate (+0.30%e vs +0.60% previous month-on-month) and core (+0.20%e vs +0.30% previous month-on-month). This aligns with the one-year inflation expectations from the New York Fed that we learned about yesterday (stable at +3.9% against the slight moderation expected). The data will be particularly relevant following the strength of the labour market we saw last Friday in the official employment report and will help gauge the chances of a +25 bp rate hike for the Fed's next meeting on 9-Dec, which is currently at 80% (vs 70% before the employment data). Today, Federal Reserve Governor Christopher Waller is scheduled to speak (10:00 Spain time) with a market that will be watching to see if he maintains his recent cautious stance on inflation or gives hints about the interest rate decision.
Yesterday, we did not see major movements in US Treasury yields, on a day when a 3-year issuance took place for $58 billion, with a bid to cover of 2.53x (vs 2.62x previous auction) although participation from institutional and foreign investors marked a 15-month low. Today, there will be a 10-year bond auction for $42 billion and on Thursday we will have a 30-year issuance for $25 billion.
In China, we had references to October foreign trade, with the trade balance at 105.280 (vs 125.800 million USD expected and 133.530 million USD previous), exports +35.2% (vs +36.3% expected and previous) and imports +41.6% (vs +33.9% expected and +31.0% previous), which provide clues about the weakness of domestic demand and strength of the external sector after last week's PMIs were close to contraction territory.
Yesterday, Nvidia finally fell c.-4%. Beyond the implications for corporate governance (some analysts doubt Jensen Huang’s continuity as CEO, with no clear successor), the market needs to consider the implications for the rest of the AI ecosystem, given that Nvidia has used its financial strength to support numerous players. Continuing with the AI theme, Anthropic is moving forward with its IPO and according to various sources, it could start this week the “roadshow” prior to the IPO, with a valuation of $1.25-1.3 trillion (vs $1.4-1.5 trillion expected before) although it has withdrawn the prospectus due to some inaccuracies in some data.
In corporate results, today CAF (Spain), Alcon (Switzerland, at US market close) and Vodafone (United Kingdom) will report results. Meanwhile, Taiwan Semiconductors has reported a 60% year-on-year increase in sales for October (vs +51% year-on-year in Q3 26 and +63% year-on-year expected for 2026 by consensus).
