A curious spectacle unfolds in the financial markets. Wall Street is basking in record highs, while other global markets are caught in a fog of uncertainty. The Federal Reserve's latest meeting minutes, released yesterday, were as enlightening as a blackout. The market already knew the script. The odds of a rate cut next month have climbed to 60%, but this figure could dance to a different tune with the avalanche of U.S. statistics expected this afternoon. October's PCE inflation figures, due at 10 a.m. ET, are particularly crucial, as the Fed keeps a hawk's eye on them for monetary policy decisions. This data deluge is courtesy of tomorrow's Thanksgiving holiday.

Fresh off the press, U.S. jobless claims matched expectations at 213,000 for the week ending November 23. The third-quarter GDP estimate also hit the mark at +2.8%.

As for Friday, it's Black Friday, the retail extravaganza, with Wall Street wrapping up early at 1:00 p.m. Essentially, the market will slip into weekend mode this evening.

U.S. stocks, as tracked by the S&P 500, have climbed 4% since the former president's election win earlier this month. The Russell 2000 index, representing U.S. small caps, has surged 7.9%. Meanwhile, the rest of the world's markets are nursing their wounds. The Stoxx Europe 600 has dipped 0.7%, and emerging markets, as measured by the MSCI Emerging Markets index, have tumbled 4.6%. China, seen as the USA's chief rival, has plunged 9.6%. This divergence is hardly shocking. The popular play has been to back the U.S. market against the rest, with the Russell 2000 stealing the spotlight. Yesterday, the performance gap since January 1 between the U.S. S&P 500 and the Stoxx Europe 600 hit a staggering 20.63%. The former is up 26.24%, while the latter lags at +5.61%.

Europe's economic woes, particularly in France, aren't helping. The interest-rate gap between French and German debt is the widest since 2012. This spread reflects the perceived risk difference between the two borrowers. Over 10 years, Germany borrows at 2.18%, while France pays 3.05%. The spread has widened to 0.87%, highlighting concerns over France's political stability and fiscal missteps. France's borrowing costs now exceed those of Spain (2.94%) and Portugal (2.69%), nearing Greece's (3.07%). Bruno Cavalier, Oddo BHF's chief economist, recently remarked, "France is now in the worst fiscal situation of any eurozone country. Public debt is high, and primary expenditure isn't covered by tax revenues. This has persisted for 23 years. No other country enjoys such market complacency."

In the Middle East, a ceasefire between Israel and Hezbollah has been reached, with Hamas showing interest in a similar deal in Gaza. Elsewhere, China's defense minister is under investigation for corruption, according to the FT. New Zealand's central bank cut rates by half a point, as anticipated, and rumors swirl that OPEC might delay its production increase until oil prices stabilize.

In the Asia-Pacific region, there's a mixed bag this morning. Shanghai rose 1.5%, while Taiwan dropped 1.3%. Japan, the region's largest market, fell 0.9%. South Korea slipped 0.7%. India and Australia are in positive territory. European leading indicators are mostly bearish, while Wall Street futures remain flat.

Today's economic highlights:

On the calendar today, wholesale inventories, a new estimate of Q3 GDP and weekly jobless claims. Household income and spending and October PCE inflation are due. See the full calendar here. 

  • Dollar: EUR 0.9493 GBP 0.7919
  • Ounce of gold: USD 2,647
  • Brent crude: USD 72.58
  • 10-year US bond: 4.26%
  • Bitcoin: USD 93,800

In corporate news:

  • Workday reported higher third-quarter earnings and revenue, with a profit of $1.89 per share and $2.16 billion in revenue, surpassing analyst expectations, although their fourth-quarter subscription revenue guidance of $2.025 billion fell slightly short of the consensus estimate of $2.04 billion.
  • CrowdStrike Holdings reported strong Q3 results with earnings and revenue surpassing expectations, and provided optimistic guidance for Q4 and FY2025, projecting continued growth in revenue and earnings per share.
  • HP reported better-than-expected fiscal Q4 revenue and non-GAAP EPS, but its shares and those of Dell fell after both companies forecasted weaker Q4 earnings and HP projected a Q1 profit below estimates due to sluggish PC market demand.
  • Autodesk reported a Q3 earnings beat with an EPS of $2.17 and revenue of $1.57 billion, subsequently raising its guidance with an expected Q4 EPS between $2.10 and $2.16.
  • Dell Technologies reported mixed Q3 results with earnings per share of $2.15 surpassing expectations, but a revenue of $24.37 billion falling short of estimates, alongside a weaker Q4 revenue forecast impacted by declining PC demand, increased competition, and cautious enterprise spending, while an insider sold shares worth over $1.1 million.
  • Nordstrom exceeded Q3 earnings expectations, reported $3.34B in revenue aligning with estimates, and raised its FY revenue and comparable sales forecasts despite a late October sales slowdown.
  • Amazon Japan is facing an investigation by Japan's Fair Trade Commission for potential anti-monopoly law violations, while simultaneously, Amazon workers in the U.S., including drivers in Atlanta, are pushing forward with unionization efforts.
  • Kohl's reported a larger-than-expected decline in Q3 revenue, lowered its full-year financial outlook, announced a new CEO, and saw its shares drop to the lowest level since 2020 amid challenges in its turnaround strategy, while consumer stocks slightly rose.
  • Mexico's president warned of inflation and job losses due to Trump's tariff threats, while consumer stocks rose and Ford planned layoffs in Germany, potentially impacting the Cologne production site.

Analyst recommendations:

  • Alexandria Real Estate Equities, Inc.: JP Morgan downgrades to neutral from overweight with a target price reduced from USD 133 to USD 121.
  • Brunswick Corporation: B Riley Securities Inc. downgrades to neutral from buy with a target price reduced from USD 95 to USD 88.
  • Martin Marietta Materials, Inc.: JP Morgan upgrades to overweight from neutral with a target price raised from USD 515 to USD 640.
  • Nvidia Corporation: Punto Research upgrades to hold from sell with a price target raised from USD 126.70 to USD 140.
  • Workday Inc.: Piper Sandler & Co downgrades to neutral from overweight with a price target reduced from USD 285 to USD 270.
  • Air Products & Chemicals, Inc.: Berenberg maintains its hold recommendation with a price target raised from 275 to USD 335.
  • Arrowhead Pharmaceuticals, Inc.: Piper Sandler & Co maintains its overweight recommendation and reduces the target price from USD 62 to USD 45.
  • CrowdStrike Holdings, Inc.: Raymond James maintains its outperform rating and raises the target price from USD 275 to USD 360.
  • Discover Financial Services: Jefferies maintains its buy recommendation and raises the target price from USD 173 to USD 210.
  • Doordash, Inc.: Citigroup maintains its buy recommendation with a price target raised from USD 155 to USD 211.
  • Ge Vernova Inc.: Redburn Atlantic maintains a neutral recommendation with a price target raised from 207 to USD 255.
  • Marvell Technology Group Ltd: Jefferies maintains its buy recommendation and raises the target price from USD 90 to USD 110.
  • Nutanix, Inc.: Wells Fargo maintains its equalweight recommendation and raises the target price from USD 60 to USD 75.
  • T-Mobile Us, Inc.: Redburn Atlantic maintains its sell recommendation with a price target raised from 143.484 to 190.USD 253.
  • Aston Martin Lagonda Global Holdings Plc: Oddo BHF downgrades to neutral from underperform with a target price raised from GBP 1 to GBP 1.20.
  • Aviva Plc: Keefe Bruyette & Woods upgrades to outperform from market perform with a target price raised from GBX 495 to GBX 545.
  • Direct Line Insurance Group Plc: BNP Paribas Exane upgrades to outperform from neutral with a target price of GBX 198.
  • International Consolidated Airlines Group, S.a.: CaixaBank BPI downgrades to neutral from buy with a price target raised from 3.05 to EUR 3.60.
  • Segro Plc: Barclays upgrades to equalweight from rating suspended with a target price of GBP 8.