'Trick or Treat' on Wall Street

A Reuters Open Interest newsletter

Everything Mike Dolan and the ROI team are excited to read, watch and listen to over the weekend.

Hello Morning Bid readers! 

Wall Street got spooked on Thursday, with Microsoft and Meta both seeing their share prices fall on concerns about the AI capex binge. However, the big news of the week was chip giant Nvidia becoming the first company to see its market cap eclipse $5 trillion, having hit $4 trillion only three months ago. With U.S. equity futures up before the bell on Friday, it looks like Halloween may be more "treat" than "trick."  

The week began with news that we would likely see an agreement between U.S. President Donald Trump and his Chinese counterpart Xi Jinping. And we saw just that on Thursday following a meeting described as a "12 out of 10" by the U.S. president.

The two settled on a deal that would see reduced U.S. tariffs on Chinese goods and a delay of China's rare earths curbs, among other promises. But don't get too excited, warns ROI Markets Columnist Jamie McGeever, the U.S.-China story has been here before.

Another big news item this week came courtesy of Federal Reserve Chair Jay Powell. While the Fed's decision to cut interest rates by 25 basis points on Wednesday was widely expected, the Chair also signalled that a December cut was far from a slam dunk. This may be an acknowledgement that interest rate cuts will likely be a pretty lousy tool if the Fed's goal is to support an economy suffering from labor supply issues.

The Fed's hawkish tone gave another boost to the U.S. dollar – which is on track for a roughly 2% gain this month – something that likely won't go down well with the Trump administration, or so argues ROI editor-at-large Mike Dolan.

In energy markets, OPEC will meet this Sunday and is expected to announce another output increase. Saudi Arabia, OPEC's de facto leader, appears to be caught between Donald Trump and a hard place, argues ROI Energy Columnist Ron Bousso, as the U.S. president's latest oil sanctions on Russia force Riyadh to weigh competing geopolitical and economic priorities.

Staying on sanctions, how useful have those on Russia actually been? ROI Asia Commodities Columnist Clyde Russell considered this question earlier in the week, arguing that it all depends on how success is measured.

On the renewables side, ROI Energy Transition Columnist Gavin Maguire this week discussed how China's electric vehicle output and exports may now hit reverse following a significant policy pivot.

Finally, in the metals markets, copper made headlines again as the London Metal Exchange price hit an all-time nominal high of $11,200 per metric ton on Wednesday.

As we head into the weekend, check out the ROI team's recommendations for what you should read, listen to, and watch to stay informed and ready for the week ahead.

I'd love to hear from you, so please reach out to me at anna.szymanski@thomsonreuters.com.

CLYDE RUSSELL, ROI Asia Commodities and Energy Columnist: This excellent Reuters special report shows how a small insurer in New Zealand is a key link in the dark fleet responsible for shipping Iranian and Russian oil.

MIKE DOLAN, ROI Financial Markets Editor-at-Large: Former IMF and World Bank top official Anne Krueger's column for Project Syndicate this week makes a powerful case for an alternative global trading system without America - a "Global Trade Organisation" or GTO – to replace the hobbled WTO, supporting the push by Canadian Prime Minister Mark Carney.

GAVIN MAGUIRE, ROI Global Energy Transition Columnist: This recent report from the Centre for Research on Energy and Clean Air (CREA) explains how China, India and Indonesia - three of the world's largest coal consumers - could all hit peak power sector emissions by 2030.

ANDY HOME, ROI Metals Columnist: Copper prices hit a new all-time high in London this week, so here's a timely overview of the market from the International Copper Study Group. Everything you wanted to know about copper but were too afraid to ask.