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At the close of trading, the Dow Jones Index (US30) rose by 0.21%. The S&P 500 Index (US500) gained 1.34%. The technology-heavy Nasdaq Index (US100) closed lower by 0.25%. Investors rotated out of overheated technology companies into cyclical and value stocks following the Fed’s 25 basis point rate cut and a soft signal on future policy. The largest gains were seen in the financial sector and payment systems: Visa added 6.2% after a BofA rating upgrade.

Mastercard and American Express rose by 4.6% and 2.5%, respectively. Major financial companies, including JPMorgan, UnitedHealth, Goldman Sachs, Wells Fargo, and Progressive, also showed solid growth. The technology sector, conversely, dragged the market down: Oracle shares fell by 10.8% due to weak revenue and worsened cloud expectations, raising doubts about the return on AI investments.

The Mexican peso (MXN) strengthened to 18 per dollar, returning to its July 2024 highs amid the dollar’s weakness following the Fed rate cut and its softer tone. Simultaneously, investors revised expectations for further Banxico policy easing: November inflation accelerated to 3.8% y/y, and core inflation to 4.43% y/y, which complicates rapid future rate cuts. Although the Fed cut the rate by 25 basis points and began purchasing $40 billion in short-term bonds, tightening monetary conditions, Mexico remains attractive due to its high real interest rates.

European stock markets rose steadily yesterday. Germany’s DAX (DE40) rose by 0.68%, France’s CAC 40 (FR 40) closed up 0.57%, the Spanish IBEX 35 (ES35) added 1.11%, and the British FTSE 100 (UK100) closed 0.52% higher.

The Swiss franc strengthened to 0.79 per dollar, approaching its 2011 highs amid the dollar’s weakness and the SNB’s decision to keep the rate unchanged at 0% for the second consecutive time. The regulator noted a slight improvement in economic prospects, partly due to a recently concluded tariff agreement with the US, and recorded lower-than-expected inflation, which led to a reduction in short-term expectations without serious changes to medium-term ones. SNB Chairman Martin Schlegel confirmed expectations of gradual inflation growth in the coming quarters, reinforcing the prognoses for stable monetary policy.

Palladium prices (XPD) held around $1,490 per ounce. Production of platinum group metals in South Africa grew by 3.9% y/y in October, the second consecutive month, indicating a stabilization of supply. Demand prospects are improving due to a 3.4% y/y increase in car sales in China in November, an 11-month high. An additional impact on the auto sector may come from the upcoming EU decision on emissions rules on December 16: the initial ban on ICE vehicles by 2035 is likely to be softened and shifted to 2040 due to industry pressure and a slower pace of transition, which could support demand for palladium in the medium term.

WTI crude oil prices fell by approximately 2% on Thursday to $57.3 per barrel, dropping to a seven-week low amid concerns about a growing global supply surplus driven by increased production from OPEC+ and producers in North and South America. Although the International Energy Agency (IEA) slightly reduced its projections for a record surplus for the first time since May, it still anticipates a significant oil surplus in the market.

The US natural gas (XNG) prices fell by 7% on Thursday, below $4.3/MMBtu, reaching a five-week low amid warm weather expectations, weak demand, and near-record production levels. Above-normal temperatures are expected until December 26, reducing heating demand. Production in the continental states rose to 109.7 billion cubic feet per day, surpassing the November high and raising inventories approximately 3% above the seasonal level. Despite a large withdrawal of gas from storage last week (177 billion cubic feet) due to a short period of intense cold, high supply, and accumulated inventories continue to pressure the market.

Asian markets traded mixed yesterday. The Japanese Nikkei 225 (JP225) fell by 0.10%, the Chinese FTSE China A50 (CHA50) dropped by 0.61%, the Hong Kong Hang Seng (HK50) rose by 0.42%, and the Australian ASX 200 (AU200) showed a positive result of 0.72% for the day. Stocks in Hong Kong opened strongly higher on Friday: the Hang Seng Index rose by 1.1% after a decline the day before. At the Central Economic Work Conference, Chairman Xi Jinping stated that 2025 would be a “truly outstanding year” and noted confidence in achieving key goals. Fiscal policy remains stimulative, and monetary policy remains soft, with an emphasis on supporting domestic demand.

• S&P 500 (US500) 6,901.00 +14.32 (+0.21%)
• Dow Jones (US30) 48,704.01 +646.26 (+1.34%)
• DAX (DE40) 24,294.61 +164.47 (+0.68%)
• FTSE 100 (UK100) 9,703.16 +47.63 (+0.49%)
• USD Index 98.32 -0.47% (-0.47%)
   

News feed for: 2025.12.12

• UK GDP (m/m) at 09:00 (GMT+2); – GBP (HIGH)
• UK Industrial Production (m/m) at 09:00 (GMT+2). – GBP (MED)

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