This Week
On October 2nd, OPEC+ opted for an output increase of 137,000 bpd in December, but stated it would not increase output levels in the first quarter of next year. On Wednesday ADP Nonfarm Employment Change will give major clues on US employment in the absence of monthly government data due to the shutdown. President Trump is expected to reveal more details about the trade truce with China and sign it into legislation. The earnings season continues with companies such as AMD, Uber, Palantir, and McDonald's. On November 6, Tesla will hold its shareholders' meeting to decide on the future direction of the company and to vote on the size of CEO Elon Musk’s wage.
Stocks
WALT DISNEY
Walt Disney’s price climbed 0.79%, as the stock bounced off an almost two-week low late in the week. In recent days, the company’s streaming service arm finalized a multi year content partnership with Apple for exclusive rights to selected Disney films. Previous quarterly data showed Disney+ subscriber growth. Reports indicated rising attendance at Disney’s theme parks, and an important revenue stream. Hopes are high that the trends will continue when earnings are posted on November 13th.
NVIDIA
NVIDIA’s stock price surged 6.5%, with the company hitting an all-time high. The chipmaker is now the first company to be worth over $5 trillion and is well ahead of second-placed Apple. Last week, the company signed its latest partnership with Samsung on quantum chip Research and Development, and recently, a tie-up was agreed with INTEL for long-term tech leadership. NVIDIA also announced plans to build new manufacturing plants in Brazil and India to meet increasing demand. While obstacles remain for the company when selling its AI chips to the Chinese market, CEO Huang hopes that President Trump may make provision for this issue in the US trade truce with China. Earnings will be posted on November 11th.
Commodities
Crude Oil
Crude oil prices declined 1.6% just ahead of the weekend’s OPEC meeting, with reports suggesting that the cartel will continue to modestly add to output from December, disappointing some traders who had believed that it might decide to freeze output at current levels. However, the US-China trade truce and a larger-than-expected drop in inventories suggested that firmer oil demand could underpin oil prices in the short to medium term.
Gold
Gold prices fell 1.5% to hit a three-week low as trade war fears eased after Presidents Trump and Xi met and agreed on a one-year truce, reducing demand for safe-haven gold. The Fed met earlier in the week and cut rates as expected, but Fed Chair Powell expressed caution about a potential cut in December, although markets still believe the Fed will cut before the end of the year.
Soybean
Soybean prices jumped 3.9% to hit a more than three-month high after China agreed to purchase around 12 million metric tons of US soybeans this year and 25 million annually over the next three years. The soybean market remains tight, with parts of the US having depressed yields this year. The market overall expected demand growth as biofuel programs expand usage and trade fears ease.
GBP/USD
The GBP/USD dropped 1.28% as concerns grew in the UK over poor economic indicators ahead of the UK Autumn Budget scheduled for late November amid fears that public spending cuts may be necessary. Lower-than-expected UK inflation data also increased the chances of the Bank of England cutting rates again. The Greenback strengthened against most of its rivals after more hawkish-sounding statements from Fed Chair Powell following last week’s rate cut.
Recap
Last week, the S&P 500 advanced 0.7%, the Nasdaq climbed 2.2% and the Dow Jones rose 0.8%.
US stock indices climbed again, boosted by strong quarterly results from companies such as Amazon, Apple, and Google. The Fed also cut rates by 25 basis points as expected. President Trump met with President Xi of China and hatched a trade truce that will be signed next week. There has been no progress in resolving the government shutdown. In stock news, Netflix announced a stock split.
Crude oil prices traded lower ahead of Sunday’s OPEC+ meeting, while Natural Gas prices edged upwards to a multi-month high. Gold prices declined as silver prices inched higher. Platinum prices fell and Palladium prices edged upwards, amid mixed economic data from China.