The week that was

Global equity markets moved higher last week on rising expectations of US rate cuts and AI optimism. The S&P 500 climbed 3.7%, with Communication Services names such as Alphabet leading the charge (+7 %) as the market became more optimistic about its positioning within AI. US markets were also supported by a more dovish tone from Fed officials, along with growing expectations that Kevin Hassett, National Economic Council Director, would be appointed Chair, which contributed to global bond markets moving modestly higher over the week. European equities climbed 2.6%, led by the mining sector which benefited from stronger commodity prices such as copper and, particularly, gold, which is on track for its best annual performance since 1979.

Summary economic releases

The week ahead

Asian markets were mixed overnight, with Chinese equities trending higher despite weakness in Japan. A statement by the BOJ Governor sent a clear signal to markets that interest rates would be raised this month, which saw both the yen and Japanese bond yields trend higher. The strength in Hong Kong was driven by a rally in the metals-and-mining sector that more than offset confirmation of weak industrial activity for the month of November in China. Oil markets also strengthened overnight as OPEC+ confirmed at the weekend that it intended to pause production hikes.

Political and macro developments will likely be the key drivers of market sentiment in the week ahead. This afternoon, US ISM data is likely to confirm that manufacturing activity continued to contract in November, although rising sector job openings could indicate a better outlook going forward. On Tuesday, Eurozone core inflation is set to remain anchored at 2.4%, although easing wage pressures and external demand tied to a stronger euro and tariffs could open the door for more cuts in 2026. Wednesday should bring confirmation that US services activity levels continued to expand in November, whilst Irish PMI data is also released.

On Thursday, Eurozone retail sales are expected to rise modestly for the month, indicating the consumer is in good shape heading into the holiday season. Finally, on Friday, data from the University of Michigan should point to a modest improvement in US consumer sentiment for December, following the cessation of the government shutdown. From a political perspective, markets will focus on continued negotiations to end the war in Ukraine, along with the potential announcement of a new Fed Chair.

Corporate updates

From a corporate perspective, earnings releases are light this week, with market attention likely to focus on consumer-sector strength over the Thanksgiving holiday period. Overall, Black Friday spending climbed 4.1% YoY (excluding autos), with strong growth online more than offsetting tepid growth in stores. Deep discounts in areas such as electronics, apparel and toys, along with the increased use of buy-now-pay-later services, served to support what remains a resilient but increasingly price-conscious US consumer.

Looking forward, retailers Inditex and Macy’s will provide further insight on the strength of the consumer on both sides of the Atlantic when they report this week. Markets will be looking for evidence of increased deployment of generative-AI tools and higher subscription revenues, particularly from public-sector clients, when Salesforce reports quarterly numbers this week. Finally, Rio Tinto, one of the world’s largest metals-and-mining companies, will hold a Capital Markets Day where investors will be looking for quantifiable cost-reduction targets and updates on plans to exit non-core areas of business.

This is an extract from the Weekly Markets Report by Cantor Fitzgerald Ireland. For more detail on individual securities, or to discuss how we can support your investment needs, please get in touch.

Written by John Mullane, CIO, Cantor Fitzgerald Ireland