Equities, Bonds, Gold, and Oil Decline Together as U.S. Treasury Yields Hit Two-Month High

Market Overview

Risk sentiment turned cautious ahead of the highly anticipated Federal Reserve meeting, sending all three major U.S. equity indices lower and snapping a four-day winning streak for both the S&P 500 and Nasdaq. Tesla fell more than 3%, while Nvidia rebounded nearly 2% on optimism surrounding its H200 chips, lifting the semiconductor index for a second consecutive session.

M&A headlines drove notable volatility across several sectors. Paramount surged 9% and Warner Bros. rose more than 4% amid reports that both companies are being courted by potential buyers—including Netflix, whose shares slid over 3% on the news. Confluent skyrocketed 29% after announcing it will be acquired by IBM.

The bond market faced broad-based selling pressure, with sovereign yields in the U.S. and Europe moving sharply higher. Hawkish comments from ECB officials led markets to price in potential rate hikes next year, pushing Germanys 10-year yield to a nine-month high. U.S. 10-year Treasury yields also climbed to their highest level in more than two months.

In FX and crypto, the U.S. Dollar Index briefly reclaimed the 99.00 handle. Bitcoin reversed sharply after breaking back above $92,000, falling nearly 3%. Commodities were mostly weaker: crude oil dropped more than 2% intraday, ending a three-day rally, while gold futures slid to a monthly low and silver pulled back from record intraday highs. Copper was the lone standout, notching another all-time high.

Key Themes to Watch● Ray Dalio Issues Macro Warning

Bridgewater founder Ray Dalio cautioned that the global economy may enter a dangerous phase over the next one to two years as debt, political polarization, and geopolitical conflict cycles converge. While acknowledging signs of froth in the AI sector, Dalio emphasized that a bubble only bursts when a catalyst—such as monetary tightening or forced asset sales driven by debt obligations—emerges.

● Nick Bostrom Hints at Strong U.S. Growth

Despite the recent government shutdown, Bostrom noted that the U.S. economy is still on track to end the year with a solid 3% real GDP growth rate. He described this years holiday shopping season as “exceptionally strong,” and expects inflation to “fall sharply” next year. He also remarked that the bond market just delivered its best year since 2020.

Data to Watch (GMT+8)

19:00 — U.S. NFIB Small Business Optimism Index (Nov.)

23:00 — U.S. JOLTs Job Openings (Oct.)

Overnight 01:00 — EIA Short-Term Energy Outlook Report