World stocks bounce as oil slides heading into US CPI print
SPY•World stocks rose as Brent crude fell more than 1.5%, while investors awaited US CPI data and reassessed the outlook for interest rates. Traders were almost fully pricing in a 25-basis-point December rate hike, up from a 74% chance a week earlier.
1. Stocks rebound
World stocks rose as oil prices fell after President Donald Trump said he planned to hold off on new military strikes against Iran. Brent crude briefly dipped below $90 a barrel, and the STOXX 600 gained 0.9%, coming within 1% of its record high. South Korea’s KOSPI rose 4.4%, Japan’s Nikkei gained 2.9%, and MSCI’s broadest Asia-Pacific share index climbed 2%.
2. Rates and inflation
Investors awaited US consumer price data, expected to show a moderate increase in October while inflation remained stubbornly high. Traders were almost fully pricing a 25-basis-point rate hike in December, compared with a 74% chance a week earlier, and the two-year Treasury yield rose 6.5 basis points to 4.611%. Fed Governor Christopher Waller said the central bank should raise short-term borrowing costs next month and consider a half-point increase if inflation worsens.
3. AI trade in focus
Nvidia shares edged 0.5% higher in premarket trading after falling 4.3% on Monday, with the company due to report earnings next week. Investors were also watching tech earnings, including CoreWeave’s, and an Anthropic IPO that a regulatory filing showed could raise as much as $64.4 billion.
