Key Takeaways
- Silver prices surged to a new record above $57 per ounce, driven by tight supply and expectations of a Federal Reserve rate cut.
- Japan's Q3 capital spending increased by 2.9% year-over-year, indicating resilient domestic demand, despite some firms cutting spending over the summer due to higher U.S. tariffs.
- Brazil's income tax changes are expected to boost the economy by $5.3 billion in 2026, according to President Lula.
- Australia's annual inflation rate edged up to 3.2% in November, while optimism among UK service firms saw its sharpest fall in three years.
- U.S. stock futures slipped with S&P 500 futures down 0.24% and Nasdaq futures down 0.3%, as Asia-Pacific markets opened mixed.
Global Markets & Economic Indicators
U.S. stock futures began the new trading week on a softer note, with S&P 500 futures down 0.24% and Nasdaq futures down 0.3%. Meanwhile, Asia-Pacific markets opened mixed, as participants remained cautious following weak Chinese PMI data released over the weekend. While some markets like the KOSPI saw a modest gain of 0.2%, the ASX 200 declined by 0.1% and the Nikkei 225 fell 0.4%. Despite this, Asia-Pacific markets were broadly set to open higher ahead of a private survey on China's manufacturing activity.
In Australia, the Melbourne Institute reported that monthly inflation held steady at 0.3% in November, but the annual inflation rate edged up to 3.2% from the previous 3.1%. Separately, Australian home prices continued to climb, though the pace of gains slowed in key cities like Sydney and Melbourne. Across the globe, optimism among UK service firms experienced its sharpest fall in three years, according to CBI data.
Japan's Economic Landscape
Japan's economy presents a mixed picture. Third-quarter capital spending increased by 2.9% year-over-year, a figure below the expected 6.0% and the prior quarter's 7.6%. This rise in Q3 capex suggests that domestic demand remains resilient. However, some Japanese firms reportedly cut capital spending over the summer after five quarters of growth, signaling weakening corporate sentiment, potentially influenced by higher U.S. tariffs. Company profits, however, saw a significant surge of 19.7% in Q3, vastly exceeding the 3.7% estimate and the previous 0.2%.
In the bond market, the 20-year Japanese government bond yield climbed 3 basis points to 2.855%, reaching its highest level since November 20. The 2-year Japanese government bond yield also edged up 1 basis point to 1%.
Commodities in Focus
Silver hit a new record, jumping 1.5% to $57.29 per ounce, driven by tight supply and expectations of a Federal Reserve rate cut. Global inventories of silver remain strained, particularly in Shanghai, contributing to elevated borrowing costs. While silver soared, gold dipped slightly, and platinum and palladium also registered gains.
Emerging Market & Geopolitical Developments
Brazil's President Lula announced that upcoming income tax changes are expected to inject $5.3 billion into the economy in 2026. In China, the military industry is reportedly facing difficulties as an intensifying corruption cleanup impacts the sector. This comes as scandal-hit arms firms in China are said to be dragging down regional sales during what was otherwise a record-breaking year.
Geopolitically, Ukraine reported holding "difficult but productive" talks with the U.S. regarding a peace plan. In other news, former President Trump confirmed a phone call with Venezuela's Maduro amid ongoing tensions. Domestically, Congress has opened inquiries following a report alleging that the U.S. targeted boat-strike survivors.
US Retail & Currency Outlook
Early data from Black Friday indicated a 3.6% year-over-year decline in U.S. in-store traffic, as shoppers delayed big purchases and prioritized essential items. Looking ahead to currency markets, HSBC projects that the U.S. dollar may reach its low point by early 2026 before beginning a recovery.
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.