Technology Rally Stalls Following Disappointing Earnings: Technology stocks came under pressure after disappointing earnings reports from Samsung Electronics and Alphabet, with Alphabet shares falling 10% in extended trading. The results revived concerns over whether the billions being invested in AI can generate sufficient returns. Nasdaq 100 futures ended a three-day winning streak, falling 1.1%, while South Korea’s KOSPI declined 1.2% after recording its largest gain in three months on Wednesday. Earnings from Amazon later today and Apple next week will provide further tests of sentiment towards the AI trade.
Short-Dated Treasuries Gain Following Fed Decision: Shorter-dated US Treasuries advanced for a second consecutive session after the Federal Reserve left rates unchanged at yesterday’s FOMC meeting. The rate-sensitive two-year yield fell by two basis points to 4.68% after Chair Kevin Warsh said policymakers remained focused on inflation but acknowledged recent signs of tighter financial conditions. Longer-dated Treasuries declined, however, as his silence on the prospect of further rate increases was interpreted as somewhat hawkish.
Oil Falls as Markets Assess Diplomatic Efforts: Brent crude fell towards $114 a barrel as markets assessed recent efforts to avert further strikes in the Middle East. The Wall Street Journal reported that US Vice President JD Vance had contacted a senior Iranian security official, while Iran’s foreign minister said Tehran continued to favour diplomacy.
Netanyahu Edges Ahead in Israeli Election: Benjamin Netanyahu moved ahead of his rival following a tense vote count, although neither candidate has a clear path to forming a government. The final outcome and potential coalition negotiations remain in focus as counting concludes in the coming days.
ECB and Bank of Japan Decisions in Focus: Attention now turns to the ECB’s interest-rate decision this afternoon and the Bank of Japan’s decision tomorrow, with both central banks widely expected to leave rates unchanged. The US calendar also includes several major economic releases, including core PCE, GDP and personal income data.
Economic Calendar
- ECB Interest Rate Decision
- US Core PCE
- US GDP
- US Personal Income
- Bank of Japan Interest Rate Decision
Key Market Moves Today
- S&P 500 Futures: -0.44% (7,748)
- Crude Oil: -0.72% ($102.02)
- Spot Gold: -0.81% ($4,034)
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