Global Markets Grapple with Geopolitical Tensions, Tech Sector Rallies

Global markets are navigating a holiday-shortened week with cautious trading as geopolitical tensions and key economic data releases loom. Asian stocks surged, mirroring tech sector gains on Wall Street, while escalating tensions between Iran and Israel add to market uncertainty. Gold reached unprecedented levels, and silver hit new records, while oil prices climbed amidst increased sanctions on Venezuela. Bitcoin is trading slightly above $89,000.

Wall Street Ends Week on a High Note

Wall Street concluded the week with gains, rebounding from a shaky start fueled by a resurgence in technology stocks that offset declines in consumer goods. The Dow rose by 0.38%, the S&P 500 increased by 0.88%, and the Nasdaq jumped by 1.31%. Megacap stocks extended their gains following positive forecasts from chipmaker Micron Technology, reigniting optimism in AI-related stocks.

Micron and Nvidia Lead Tech Rally

Micron reached a record closing high, surging 7%, while Nvidia climbed 3.9%. Oracle also saw a significant boost, jumping 6.6% following the agreement for ByteDance to cede its U.S. TikTok operations to an investor group.

Nike's Struggles Weigh on Consumer Goods

Nike, however, experienced a sharp decline, plummeting 10.5% after reporting a drop in gross margins for the second consecutive quarter due to weak sales in China and efforts to revamp its product mix.

Santa Claus Rally Historically Boosts US Stocks

December is typically a favorable period for U.S. equity markets. Since 1950, the "Santa Claus rally" has seen an average rise of 1.3% in the S&P 500 index during the last five trading days of the year and the first two trading days of January, according to the Stock Trader’s Almanac.

Key Economic Data and AI Market in Focus

This week, the U.S. will release data on Q3 GDP, durable goods orders, and consumer confidence. Attention will likely remain on the artificial intelligence market, which has driven stock gains this year. The S&P 500 is up over 15% year-to-date in 2025, on track for its third consecutive year of gains of at least 10%. Futures on Wall Street indices are all trending upward.

Asian Markets Surge, Led by Technology Sector

Most Asian stocks are showing significant gains. The MSCI All Country World index, a broad indicator of the stock market, has risen for the third consecutive day, bringing its 2025 gain to 20%. An index of Asian stocks jumped up to 1.1%, propelled by the technology sector.

Yen Plummets After BOJ Rate Hike

The Japanese yen is sharply declining after the Bank of Japan (BOJ) raised interest rates to 0.75% on Friday, the highest in 30 years, and announced further increases, heavily impacting public debt. Ten-year government bond yields rose another 8 basis points to 2.10%, levels not seen since 1999. The BOJ meeting minutes are expected on Wednesday. The yen hit a new record low against the euro at 184.90 and against the Swiss franc at 198.08. The dollar paused at 157.29, with investors wary of testing the November peak at 157.90, potentially triggering intervention from Tokyo. Japanese officials have expressed concern over unilateral moves and warned against excessive declines, hinting at appropriate measures. A break of 158.00 upward would target the 2025 high at 158.88, and then the 2024 high at 161.96. The dollar remained stable against a basket of currencies at 98.725, after gaining 0.3% on Friday.

Tokyo's Nikkei Rises, Boosted by Tech and AI Investments

Tokyo's Nikkei index is up 1.9%, extending Friday's rebound. SoftBank, a major investor in high tech and artificial intelligence, rose 5.1%. According to Reuters, the company is accelerating efforts to finalize $22.5 billion in funding for OpenAI by the end of the year. Within the Nikkei, 133 stocks rose against 89 declines. The largest gains were recorded by Resonac Holdings, up 7.8%, followed by Mitsui Kinzoku, a key supplier for the AI sector, which gained 7.7%. Tokyo Electron rose 7%.

China's Hang Seng and CSI 300 Show Modest Gains

In China, Hong Kong's Hang Seng index is up 0.1%, while the CSI 300 of the Shanghai Shenzhen listings is up 0.9%. The People's Bank of China (PBOC) announced it would keep its benchmark interest rate unchanged at 3% for the eighth consecutive month, in line with analyst expectations.

Kospi and Singapore Reach Record Highs

South Korea's Kospi in Seoul is up 2% due to optimism about earnings related to artificial intelligence. Singapore rose 1%, reaching a record peak.

Silver and Gold Hit New Records

Silver was the standout performer in commodities, reaching a new record at $69.44 an ounce, bringing annual gains to almost 140%. Gold surpassed $4,400 an ounce for the first time, driven by increasing expectations of further rate cuts in the United States and strong demand for safe-haven assets. Spot gold rose 1.4% to $4,397.16 an ounce, after exceeding the $4,400 threshold and reaching a record high of $4,400.29 earlier in the day. Spot silver rose 3.3%, reaching a record high of $69.44. Platinum reached its highest level in over 17 years, and palladium touched its highest level in nearly three years.

Oil Prices Rise Amidst Geopolitical Tensions

Oil prices increased after the United States intercepted a Venezuelan oil tanker over the weekend and is pursuing another, marking the third such operation in less than two weeks. Escalating hostilities between Iran and Israel also contribute to concerns. The Israeli army's chief of staff hinted that Israel might strike Iran again. Brent crude rose 0.8% to $60.96 a barrel, while U.S. crude rose 0.8% to $56.99 a barrel.

Here is the summary of commodity prices:

Here's a summary of key market index changes:

The following table shows the currency exchange rates:

European Markets Expected to Open Flat

European stock markets are expected to open near parity, with Eurostoxx 50 futures at -0.08%.

UK GDP Expands in Q3

The UK's GDP expanded by 1.3% in the third quarter.

Italy's Budget Law Reaches Senate Floor

In Italy, the budget law is set to be debated in the Senate today.

Corporate Updates

Here are some updates on specific companies:

Fincantieri Joins FTSEMib

Fincantieri has joined the FTSEMib, replacing Interpump.

Enel Completes Share Buyback Program

Enel, after completing its share buyback program, holds 133,554,875 treasury shares, representing approximately 1.3137% of the share capital.

Poste and IPZS Exercise Option for PagoPA

Poste Italiane and the Istituto Poligrafico e Zecca dello Stato have exercised their option to purchase the entire capital of PagoPA from the Ministry of Economy and Finance for 500 million euros.

Saipem Awarded QatarEnergy Contract

Saipem, in partnership with Offshore Oil Engineering, has been awarded an EPCI contract from QatarEnergy worth approximately $3.1 billion for Saipem alone and approximately $4 billion in total. Jefferies confirms a buy recommendation and a target price of 3.3 euros.

Stellantis CEO Warns on EU Auto Industry Measures

Stellantis CEO Antonio Filosa stated in an interview with the Financial Times that the new package of measures for the automotive industry proposed by the EU puts manufacturers' investments in the area at risk.

Tim Wins Cassation Court Ruling

Tim announced that the Court of Cassation has ruled in its favor in a long-standing dispute over concessions, confirming that the group is entitled to just over 1 billion euros to settle a dispute that has been dragging on for over twenty years. The Board of Directors decided to simplify the capital structure and leave only one category of shares on the Stock Exchange. In particular, it was proposed to convert savings shares into ordinary shares with an adjustment and a capital reduction to rebuild reserves.

Here is a summary of key corporate updates:

Banco BPM Faces Potential Challenge from Crédit Agricole

Crédit Agricole is considering presenting an independent list for the renewal of the Board of Directors of Banco Bpm. According to media reports, the French group, the largest shareholder of Piazza Meda with 19.8% of the capital and ready to rise above 20% with the authorization of the ECB, is thinking of running alone. Compared to the last renewal in 2023, the shareholding has doubled and could soon approach 30%, also thanks to the increase in the takeover threshold provided for by the new Tuf.