Stock Market Update

The S&P 500 futures currently trade 14 points above fair value.

Asian markets finished broadly higher on Wednesday as renewed AI enthusiasm spread across Japan, China, and South Korea, where the KOSPI surged 6.6% and topped 6,000. Japan's Nikkei 225 gained 1.1% for a second consecutive advance, led by Kioxia (+14%), Ibiden (+8%), Taiyo Yuden (+7%), SoftBank Group (+5%), and Advantest (+3%) following another round of AI-related investment announcements in the U.S. China's Shanghai Composite rose 0.9% and the Shenzhen Component rallied 2.0%, with Zhongji Innolight (+10%), Cambricon Technologies (+5%), NAURA Technology (+4%), Eoptolink Technology (+3%), and SMIC (+2%) reversing some of Tuesday's technology weakness as investors also awaited policy signals from the Communist Party's Fifth Plenum. Hong Kong's Hang Seng edged up 0.2%, with Lenovo (+6%) and SMIC (+5%) among the technology leaders, although weakening mainland investment flows limited the broader advance. South Korea's KOSPI soared 6.6% after SK Hynix reported a more than sevenfold increase in third-quarter operating profit, providing tangible earnings evidence behind the AI-demand story, while Samsung Electronics (+6%), KB Financial (+3%), Hyundai Motor (+3%), and LG Energy Solution (+3%) also advanced. The simultaneous strength in Japanese, Chinese, and Korean technology shares marks a notable broadening from Tuesday, when China's technology sector moved sharply against the AI rebound elsewhere in the region. Australia's inflation backdrop remained firm, with Q3 CPI rising 1.3% q/q and 3.9% yr/yr and trimmed-mean inflation accelerating to 3.7% yr/yr, while the Reserve Bank of New Zealand left its policy rate unchanged at 2.75%. Investors now turn to today's Federal Reserve decision and upcoming policy announcements from the European Central Bank and Bank of Japan.

• In economic data:
  • Australia's Q3 CPI increased 1.3% q/q (expected 1.3%; prior 0.6%) and 3.9% yr/yr (expected 3.9%; prior 3.9%).
  • Australia's Q3 Trimmed Mean CPI increased 1.0% q/q (expected 1.0%; prior 0.8%) and 3.7% yr/yr (expected 3.6%; prior 3.6%).
  • Australia's September Monthly CPI Indicator increased 4.3% yr/yr (expected 4.2%; prior 4.0%).
  • The Reserve Bank of New Zealand held its policy rate at 2.75% (expected 3.00%; prior 2.75%).

European markets trade mostly lower as investors sift through a heavy slate of corporate earnings while awaiting the Federal Reserve's policy decision and another round of major U.S. technology results. Germany's DAX slips 0.1%, with Symrise (-12%) plunging after warning of slower organic growth and margin pressure, while Deutsche Bank (+3%) advances following better-than-expected quarterly profits and BASF reverses lower despite raising its full-year guidance. France's CAC 40 eases 0.2%, with Remy Cointreau (-5%) falling despite better-than-expected sales, while Stellantis (+3%) and Danone (+2%) advance following encouraging corporate updates. London's FTSE 100 falls 0.3%, with GSK (-4%) and Unilever (-4%) weighing on the index despite relatively resilient results, while Standard Chartered (+5%) rallies after beating profit expectations. U.K. investors are also awaiting Chancellor John Healey's first Budget later today, while Brent crude's rebound above $115 adds another source of inflation and growth uncertainty across the region. The STOXX Europe 600 falls 0.3% and Spain's IBEX 35 underperforms with a 1.3% decline, extending a volatile stretch for Spanish equities amid lingering pressure on companies with significant Latin American exposure.

• In economic data:
  • Germany's November GfK Consumer Climate fell to -30.8 (expected -30.1; prior -30.6).
  • Switzerland's October ZEW Expectations fell to -15.3 (prior 2.6).
  • Italy's August Industrial Sales decreased 0.9% m/m (prior 1.7%) and increased 4.2% yr/yr (prior 4.9%).
  • Italy's September PPI increased 2.9% m/m (prior 2.4%) and 13.8% yr/yr (prior 10.9%).