Our CIO, John Mullane, shares the latest Market News and Views and gives insights for the week ahead.

The Week That Was

A ratcheting up of trade tensions between the US and China was enough to see investors take profits following a strong recent rally in equity markets. The S&P 500 ended 2.4% lower, representing its worst week since late May, as Trump threatened 100% tariffs on China in response to new export controls on its rare earths and a reluctance to buy US soybeans. These trade tensions also reverberated across European markets, which ended 1.1% lower, with the Auto sector (-9.1%) a laggard, dragged lower by BMW, which reported weak Chinese sales volumes. The precious metals Gold and Silver passed key levels of $4,000 and $50 an ounce respectively for the first time, on escalating trade tensions, whilst oil prices (WTI) trended 3.3% lower on the back of the ceasefire in Gaza.

Summary Economic Releases

The Week Ahead

Markets started the week on the back foot in Asia, with equities in Hong Kong leading the declines amid US–China trade hostilities. The weakness in China came despite better-than-expected export data and attempts by President Trump to de-escalate tensions ahead of a potential meeting with Xi Jinping at the APEC Summit at the end of the month. Equities in Tokyo were also lower as Japanese opposition parties attempted to derail the appointment of Sanae Takaichi from the ruling LDP as the country’s new Prime Minister.

The commencement of third-quarter earnings season will likely be the key driver of market sentiment for the week. US banking giants JP Morgan, Goldman Sachs and Morgan Stanley will be the key focus in a week dominated by financial sector earnings releases. The banking sector is expected to have a strong quarter, buoyed by the highest investment banking revenues since 2021, robust commercial loan growth and stable net interest margins. For the season overall, the S&P 500 is expected to post its eighth consecutive quarter of positive earnings at 8.0%, with IT, Utilities and Financials set to be among the best performers. In Europe, earnings are set to be broadly flat for Q3, with key releases this week including ASML and LVMH. Investors will be looking for sequential improvement in the key Fashion & Leather Goods division for LVMH, while AI-related order momentum will be in focus for ASML.

There will also be plenty of market-moving political and economic events to watch for in the week ahead. On Tuesday, UK employment data is likely to point to resilient wage growth despite the economy operating below full employment. The October ZEW Survey should see economic expectations for Europe’s largest economy climb to their highest levels since July. On Wednesday, market participants will be looking to the Fed’s Beige Book to shed light on the strength of the labour market in the absence of more granular data points due to the US government shutdown. From a political perspective, the reappointment of Sébastien Lecornu as Prime Minister, combined with a new cabinet, will refocus attention on efforts to pass a budget in France ahead of credit rating updates from Moody’s next week. Budgetary negotiations will also be front and centre in Washington as the government shutdown enters its third week.

Key Market-Moving Events This Week

• Macro: Fed Beige Book, German ZEW Survey
• Corporate updates: LVMH, ASML, JP Morgan, and Morgan Stanley
• Political developments: Negotiations on US government shutdown, French budget, and US–China trade

Further Reading

This is an extract from the Weekly Markets Report by Cantor Fitzgerald Ireland. For more details 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