A Supercharged Week for Global Markets
TREE NEWS reports: Investors are bracing for one of the most consequential weeks of the year, as a dense calendar of political, macroeconomic and corporate events converges to test market sentiment already reeling from a bruising sell-off in technology shares. The week beginning November 2 features the US midterm elections, the October nonfarm payrolls report, and earnings from Apple and AMD, all against a backdrop of fragile confidence in the artificial intelligence trade.
The prior week ended on a sour note. Intel suffered its largest single-day decline on record, plunging 29%, while the Nasdaq posted its worst month in over a year. Record capital expenditure at Amazon, negative free cash flow at Google, and a sharply lowered gross margin guidance from Intel combined to shake faith in the AI-driven rally, triggering a broad sell-off across the technology sector.
Elections Take Center Stage
On November 3, the United States holds its midterm elections, with all 435 House seats and 35 Senate seats up for grabs. The outcome will determine how easily the Trump administration can advance its fiscal, tariff and industrial subsidy agenda over the next two years. Betting markets currently price a 67% probability of a Democratic sweep of both chambers, a scenario that could complicate the passage of further fiscal stimulus and reshape the policy landscape for sectors ranging from semiconductors to energy.
Macro Data and Central Banks
The October nonfarm payrolls report, due November 6, looms as the week’s most significant macro release. September’s reading showed a mere 29,000 jobs added, and consensus expects 65,000 for October. With the 10-year Treasury yield closing the week at 4.9%, a stronger-than-expected print would reinforce expectations of further rate hikes, driving simultaneous moves in the dollar, Treasuries and gold. White House adviser Kevin Hassett has suggested that persistently high inflation would justify another hike.
Elsewhere, the Reserve Bank of Australia is expected to raise its policy rate to 4.85% on November 3, its fifth hike of the year, while the Bank of England is forecast to lift rates by 25 basis points to 4.00% on November 5. China releases October foreign exchange reserves on November 7, with attention on the central bank’s gold holdings, which have now risen for 23 consecutive months.
Earnings Under the Microscope
Apple and AMD report earnings that will serve as a critical test for the AI trade. Apple, in the first results under new CEO John Ternus, is expected to post revenue of roughly $113 billion, with memory price inflation and holiday-quarter guidance in focus. AMD’s guidance points to about $13 billion in revenue, with the ramp of its Helios racks and MI450 chips determining whether its trillion-dollar valuation holds. Results from Qualcomm, Lumentum, Coherent, Super Micro and Berkshire Hathaway are also due.
Geopolitics and Other Catalysts
Israel publishes final results of its parliamentary election on November 4, while Russia has signaled willingness to resume trilateral talks with the US and Ukraine after that date, with Abu Dhabi proposed as the venue. Any resumption would mark the highest-level contact since Istanbul, with implications for oil, gas and safe-haven assets. Meanwhile, Marvell is in advanced talks to acquire Lumentum, a deal that could be announced as soon as this week and would represent a major consolidation in the AI hardware supply chain.
Key Takeaways for Investors
- Political risk is elevated: A Democratic sweep could stall fiscal and industrial policy, pressuring sectors reliant on government subsidies.
- Rate expectations hinge on payrolls: A hot jobs number would cement hike bets, supporting the dollar but weighing on bonds and gold.
- AI confidence on the line: Apple and AMD results will determine whether the recent tech sell-off stabilizes or deepens.
- Watch geopolitics: Russia-Ukraine talks and Middle East developments could swing energy and safe-haven flows.
