Key Takeaways
- China has significantly eased export controls and removed several US entities from its unreliable list, signaling a de-escalation in trade tensions and potentially boosting US tech firms.
- October PMI data for the UK, Eurozone, and Germany largely exceeded preliminary estimates, indicating a stronger-than-expected rebound in economic activity, particularly in the services sector.
- Super Micro Computer (SMCI) shares experienced a decline following reports of delivery delays impacting its AI server momentum and quarterly revenue.
- The ECB's wage tracker for Q2 2026 shows an acceleration in negotiated wage growth, which could influence future monetary policy decisions amidst ongoing inflation concerns.
- Mixed economic indicators emerged from the UK and Italy, with UK new car registrations slowing sharply in October and Italian retail sales contracting monthly.
China-US Trade Relations See Significant Easing
In a major development, China's Commerce Ministry announced a series of adjustments to its export control lists, notably suspending measures against 16 US entities for one year and removing 15 US firms from its export control list entirely. This move follows recent talks and signals a significant de-escalation in trade tensions between the two economic powerhouses. The Ministry also confirmed it would continue to suspend export control list measures against a total of 31 US entities, including those previously announced in April. This decision is expected to foster greater cooperation and potentially alleviate supply chain pressures for affected US companies.
Separately, China's Commerce Minister Wang met with Australia's Trade Minister, urging both nations to consolidate cooperation in mining, agricultural trade, and to further expand services trade. This underscores China's broader efforts to strengthen international trade relationships.
European and UK PMI Data Signal Economic Resilience
October's Purchasing Managers' Index (PMI) data revealed a robust performance across key European economies. The Eurozone HCOB Services PMI Final reading climbed to 53.0, surpassing the preliminary estimate of 52.6 and the previous month's 52.6. Consequently, the HCOB Composite PMI for the Eurozone also rose to 52.5, up from the preliminary 52.2. Germany, a major economic engine, saw its HCOB Services PMI Final reach 54.6 (est 54.5; prev 54.5) and its Composite PMI hit 53.9 (est 53.8; prev 53.8), indicating strong economic activity.
The UK also reported positive PMI figures, with the October Composite PMI reaching 52.2, a notable increase from the preliminary 51.1. The UK October Services PMI likewise improved to 52.3 from a preliminary 51.1. These figures suggest a resilient private sector, particularly in services, providing a boost to economic sentiment.
Super Micro Shares Slip Amid AI Delivery Delays
Shares of Super Micro Computer (SMCI) experienced a downturn as the company reported delivery delays that are stalling its artificial intelligence (AI) momentum. The delays have impacted the company's ability to meet expected revenue targets, raising concerns among investors about the near-term outlook for AI hardware demand. This development highlights the complexities and potential bottlenecks within the rapidly expanding AI infrastructure market.
ECB Wage Tracker Points to Rising Wage Pressures
The European Central Bank (ECB)'s wage tracker for Q2 2026 registered 2.128%, an increase from the previous 1.760%. This acceleration in negotiated wage growth suggests persistent underlying inflationary pressures within the Eurozone, which could factor into the ECB's future monetary policy decisions.
Mixed Economic Signals from UK and Italy
While some economic indicators showed strength, others presented a more mixed picture. UK New Car Registrations (Y/Y) for October saw a significant slowdown, rising by only 0.5% compared to a robust 13.7% in the previous month. In Italy, Retail Sales (M/M) for September declined by -0.5%, worsening from a revised -0.2% in August. On an annual basis, Italian retail sales grew by a modest 0.5%.
In other news, Spain's September crude oil imports rose by 10.4% year-over-year to 5.2 million tonnes, according to CORES, indicating increased energy demand. The UK FCA also extended its motor finance consultation deadline to December 12. Meanwhile, the Bank of Japan (BOJ) maintained its cautious stance, with officials indicating that action is likely to remain limited until wage data confirms stronger growth, despite inflation being near target.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.