The Morning Update

The USD is steady, oil prices retreat, equity markets are mixed, and U.S. yields rise as investors continue to price a more hawkish Fed. The U.S. dollar holds near a 19-month high as hotter inflation and hawkish Fed commentary reinforce expectations for further tightening. Markets are fully pricing a December hike, while today’s jobless claims and Fed speakers could provide the next direction. Global equity markets are mixed as renewed turmoil around Nvidia weighs on technology shares and drags Nasdaq futures lower, while parts of Europe hold up better on rotation into consumer and defensive sectors. The pressure is concentrated in the AI complex, with investors reassessing leadership risk at Nvidia even as some rival chipmakers benefit from potential market-share gains. Elsewhere, oil, gold and Bitcoin all weaken. Crude is pressured by recovering Middle East production and renewed oversupply concerns, gold slips as a firm USD and higher Fed rate expectations reduce demand, while Bitcoin remains soft amid continued crypto fund outflows and broader caution across risk assets. Today’s economic calendar includes U.S. Initial Jobless Claims, Existing Home Sales and the Monthly Budget Statement, alongside speeches from ECB President Lagarde and Fed officials Hammack, Barr, Daly and Williams.

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News Headline. Nvidia stock falls 6% as investors await Jensen Huang's fate. Ukraine says Starlink restrictions are as US envoys land in Moscow. The UK and EU set to delay 10% tariff on electric cars. Joly set to hold meeting in Toronto with Stellantis, union and Ontario minister. Healey says Treasury discussing 'worst-case' energy support for UK households.Russian diesel exports double after Trump lifts sanctions, but US gets none. France signals support for Spain's ECB presidential candidate. PM Carney touches down in Dublin, set to address European leaders. Canada's ambassador warns Trump tariffs are driving up costs, threatening US investments. Canadian heavy crude rebounds amid cheaper tanker costs. Santander sweetens off for Brazil unit stake with 5% increase. Blackstone and Pimco target Gulf's multibillion-dollar buildout.

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In currency markets. Against the USD, global currency markets are mostly steady, with AUD and ZAR among the weaker performers. AUD remains under pressure from softer risk sentiment, weaker commodity-linked demand and expectations that the RBA will stay on hold after its recent hike, while ZAR is being weighed by the stronger dollar, rising Fed tightening expectations and concern ahead of weak South African mining data.

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In commodity markets. WTI -0.66% | Nat Gas +1.77% | Gold -1.17% | Silver -1.72% | Copper -1.33% | Palladium -2.73% | Coffee -0.08% | Cocoa +0.18% | Soybeans -0.16% | Wheat -0.45%

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CAD is little changed in early trading, stabilizing near four-week lows as the USD eases from recent highs. Disappointing Canadian employment data, rising unemployment and weakening oil prices, with WTI crude down approximately 17% from late-October levels, continue to weigh on the loonie. Stronger US inflation and hawkish Fed commentary reinforce expectations of further US rate hikes, leaving CAD vulnerable to renewed weakness.

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EURCAD is little changed in early trading, with weakening oil prices and softer Canadian employment data weighing on CAD, while expectations of further ECB tightening provide support to the euro. Attention now turns to ECB President Christine Lagarde's scheduled remarks today for further guidance on the interest rate outlook, with French fiscal uncertainty remaining a potential headwind for the single currency.

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EUR steadies against the USD in early trading, recovering modestly after touching fresh 18-month lows as the greenback retreats from recent highs. Stronger US inflation and rising expectations of further Fed rate hikes continue to weigh on the single currency, while concerns over Eurozone growth are limiting expectations for ECB tightening beyond December. Attention now turns to ECB President Christine Lagarde’s remarks today for further guidance on the monetary policy outlook.

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GBPEUR remains flat in early trading as stronger-than-expected UK industrial production and a 0.7% rebound in third-quarter GDP provide modest support to GBP. However, rising energy costs and concerns over the UK growth outlook are limiting further gains, while expectations of additional ECB tightening continue to underpin the euro. Attention now turns to ECB President Christine Lagarde’s remarks today for further guidance on the monetary policy outlook.

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GBP remains sidelined against the USD in early trading despite stronger-than-expected UK industrial production and third-quarter GDP growth of 0.7%. Resilience in the UK economy is supporting expectations of further Bank of England tightening, although rising energy costs and weakening construction activity present growing headwinds. Meanwhile, stronger US inflation and hawkish Fed commentary continue to underpin the greenback, limiting any meaningful GBP recovery.