Today’s Outlook:
• US MARKET : At the closing of NYSE Dow Jones Industrial Average fell 498 points, or 1.1%, the S&P 500 index dropped 0.8%, and the NASDAQ Composite slipped 1.2%.
The S&P 500 fell Tuesday, adding to recent losses as the selloff in tech continued just a day ahead of key earnings from Nvidia and a long-awaited labor market reading for September due later this week. Before Tuesday’s session, the broad-based S&P 500 was off more than 2% in November after notching gains for six straight months. The index is off by more than 3% from its recent all-time high, but the tech-heavy Nasdaq is worse off, down more than 5% from its record.
Investors have continued to dump large technology shares amid caution ahead of Wednesday’s quarterly earnings from Nvidia. The company is at the heart of a massive AI-fueled valuation surge over the past three years, with questions over this ascent having emerged in recent months. Broader tech shares also fell amid growing doubts over the long-term prospects of AI, and the potential returns from the hundreds of billions of dollars being invested in the industry. Alphabet Inc Class A (Google), meanwhile, sidestepped the tech selloff after Google announced the next version of its AI model Gemini 3, with improving coding and search abilities.
Away from the corporate sector, investors are also awaiting the release of key U.S. economic readings that were delayed by a prolonged government shutdown in October. Nonfarm payrolls data for September is due on Thursday, and will be closely watched for more insight into the labor market, which is a key consideration for the Federal Reserve. Inflation data will also be on tap as the Department of Labor confirmed that the U.S. producer price index data will be released on Thursday.
Fed Governor Waller said on Monday that the central bank should cut interest rates to prevent further deterioration in the sector. But these comments come amid waning bets that the Fed will cut interest rates in December. The delay of several key labor and inflation readings will see the Fed flying mostly blind into its December meeting, making a hold more likely as the policymakers await concrete evidence to base their decisions on. Markets are pricing in just over a 40% chance for a 25 basis point cut during the Fed’s Dec 10-11 meeting, down from 55.4% last week, CME Fedwatch showed.
• EUROPEAN MARKET : European stocks fell sharply on Tuesday, tracking overnight declines on Wall Street on renewed concerns over elevated tech valuations ahead of earnings from AI-darling Nvidia. The DAX index in Germany dropped 1.8%, the CAC 40 in France tumbled 2.1% and the FTSE 100 in the U.K. declined 1.5%
• ASIAN MARKET : Most Asian stocks fell on Tuesday, tracking overnight declines on Wall Street as investors offloaded technology shares ahead of key earnings from artificial intelligence bellwether Nvidia this week.
Japanese markets were the worst performers for the day, falling sharply amid a growing sell-off in long-dated government bonds on concerns over how Prime Minister Sanae Takaichi will fund her expansionary fiscal policies.
Japanese markets were spooked by longer-term Japanese government bond yields soaring to multi-decade highs, amid a growing rout in bond prices. Japan’s 30-year government bond yields surged 1.8% and were close to record highs, while the 20-year bond yield jumped 1.4% to a record high. Selling in the bond market came as Takaichi’s administration prepares to release its first ever spending package, which could be revealed as soon as this week.
Data showing a sharp third-quarter contraction in the Japanese economy fueled bets that Takaichi will dole out even more spending to support the economy. Media reports showed that Takaichi was also considering tax cuts to boost private spending. Higher yields make it more difficult for governments to issue debt, while increased bond selling by investors signals waning faith in government debt.
• COMMODITIES : Oil prices settled higher on Tuesday after a choppy session as traders weighed the impact of Western sanctions on Russian oil flows, as well as U.S. President Donald Trump saying his administration had started interviewing for the next Federal Reserve chair.
Brent crude settled up 69 cents, or 1.07%, at USD 64.89 a barrel. U.S. West Texas Intermediate crude was up 83 cents, or 1.39%, to USD 60.74.
• INDONESIA : The JCI closed with a -0.65% contraction, settling in the red zone at 8,361.93, where it still failed to hold above the 8,400 resistance. The index now has the potential to retest the 8,200 support, with current movements leaning more toward consolidation within the 8,200–8,400 range.
Today is Bank Indonesia’s policy meeting, where market consensus expects the benchmark rate to remain at 4.75%. Should a surprise rate cut occur and be followed by a spike in volume for banking and property stocks, both sectors could see short-term upside and provide opportunitiesfor scalping.
Rotation to Old Dividend Players & Back to Consumer: We continue to recommend allocating a portion of the portfolio toward stocks offering dividend yields above government bonds, as well as defensive consumer goods names, to balance the portfolio and take advantage of their attractive valuation–yield profile.
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