The vast majority of global stock markets lost considerable ground last week. The FTSE 100 gave up 0.3%, the DAX fell 1.6%, the CAC 40 fell just over 2%, while the Nasdaq 100 lost 3.1% and the Nikkei 225 dropped 4%. Only the indices with the most defensive stocks, mainly pharmaceuticals, managed to hold their own: the Swiss SMI and the Belgian Bel 20 gained a few points. But overall, the markets were in the red due to fears about the financing of the rise of artificial intelligence and the trajectory of key interest rates in the United States, where the shutdown is clouding the outlook for monetary policy by preventing the compilation and publication of key statistics on inflation, employment, and a host of other indicators.

The situation could therefore be resolved after 40 days of budgetary deadlock. On Sunday evening, thanks to the controversial support of a few Democratic lawmakers, the Senate approved a vote on a bill to fund the government until January 30, 2026. Part of the opposition is critical of this bill, which it considers too favorable to Republicans. The most sensitive issue, the extension of healthcare reimbursements, will be put to a separate vote. If the bill is passed by the Senate and then by the House, it will be sent to Donald Trump for enactment.

The likely end of the stalemate comes at a time when its consequences were beginning to become visible and damaging, i.e., to have negative media and economic repercussions. From an investor sentiment perspective, this is therefore not a zero-sum game. The return to normal is fueling a bullish bias for equities. The start of the week will be marked by this event, which has already whetted investors' appetite for technology stocks in Asia this morning. Why technology stocks? Because they are more volatile and offer better leverage (relative upside potential between two stocks in response to the same event), especially after suffering a small purge last week.

The end of the shutdown in the coming days will have multiple consequences. The one that will ultimately crystallize the attention of financiers is undoubtedly the publication of the many outstanding statistics, because they will provide indications of what the US central bank will decide in December at its last monetary policy meeting of the year. What will be the pace of announcements? How will the oldest data be interpreted? It is difficult to know. Notably missing are October's employment figures, which should have been announced last Friday, and consumer and producer price figures and retail sales, which are due to be announced this week, are also likely to be missing.

Here’s everything you need to jump-start your week.

  • In the US, Donald Trump has proposed paying $2,000 to all Americans except “high-income earners” to help soften the blow of inflation linked to tariffs.
  • In Russia, the Kremlin has denied that Foreign Minister Sergey Lavrov has fallen from grace. Lavrov also hinted that Moscow is preparing a nuclear test. He also said he was ready to meet with his US counterpart Marco Rubio.
  • In Hungary, Viktor Orban announced that he had obtained a “financial shield” from the US in case of destabilization of the Hungarian financial system.
  • In China, inflation returned in October, against all expectations. Consumer prices rose 0.2% year-on-year, their strongest increase in the last nine months. Producer prices, on the other hand, continued to fall, but at a slightly slower pace than expected. Beijing also made concessions to end the deadlock surrounding Nexperia, a supplier of critical automotive chips.
  • In the field of AI, the major platforms are working to minimize fears of loss-making investments, which have caused some turbulence in the markets. This issue is likely to continue to haunt the media and financial world for some time to come, but it should not be forgotten that US companies in the sector are very strongly supported by the US administration. In fact, it is not so much a question of financing as of global hegemony. While Europeans are wondering how to legislate to control AI, Washington is working hard to take the global lead in this area on the principle of “winner takes all” in order to gain control in the long term. It is the AI version of “whatever it takes.”
  • On the macro agenda for the week: it is still a little early to hope for the return of official statistics in the US, as the machine needs time to restart if the shutdown ends. In Europe, the ZEW index of German financial confidence (Tuesday) and UK Q3 GDP (Thursday) will be the main highlights of the week.
  • On the corporate agenda, we await the results of Chinese tech stars (Alibaba, Tencent, Netease and SMIC), as well as US companies exposed to AI (CoreWeave, Applied Materials, etc.) and a few large European caps (Infineon, Siemens AG, Compagnie Financière Richemont, Allianz, etc.).

In Asia-Pacific, the upturn continued at the start of the week, following the agreement in principle reached in the US Senate to end the budget deadlock. Tech stocks helped several indices climb during the session or at the end of trading: Japan's Nikkei 225 (+1.2%), Hang Seng in Hong Kong (+1.5%), KOSPI in South Korea (+3%) and TAIEX in Taiwan (+0.8%). India (+0.6%) and Australia (+0.8%) also posted gains. Europe is expected to open comfortably in positive territory.

Today's economic highlights:

See the full calendar here.

  • GBP / USD: US$1.31
  • Gold: US$4,071.32
  • Crude Oil (BRENT): US$64.1
  • United States 10 years: 4.14%
  • BITCOIN: US$106,234

In corporate news:

  • JTC PLC is being acquired by Permira for over $2.6 billion (£2 billion).
  • Roche's fenebrutinib met its primary endpoint in a Phase III trial for relapsing multiple sclerosis.
  • Stabilus SE reported strong fiscal year 2025 results with an adjusted EBIT margin of 11% and plans for €19 million in cost savings by 2027.
  • SEB advises purchasing Sveafastigheter stock with a price target of 43 SEK.
  • Aramex appointed Nicolas Sibuet as interim CEO until May 2026.
  • Exxon Mobil is modifying its low-carbon technology investments due to sluggish demand and policy challenges.
  • Rumble Inc. acquired Northern Data AG in a $766.86 million all-stock deal, securing a $100 million advertising commitment from Tether.
  • Ionic Rare Earths and US Strategic Metals are collaborating on a magnet recycling facility in Missouri.
  • ANZ Group's annual profit fell by 10% due to legal penalties and other expenses, with a 3% cost reduction pledged by 2026.
  • MA Financial Group is conducting due diligence to acquire Hyperdome Town Centre.
  • Tesla sees a leadership change in the Cybertruck program as Siddhant Awasthi departs.
  • Dyno Nobel announced a final dividend of 9.5 AUD per share and plans to resume its A$900M share buyback program.

See more news from UK listed companies here

Analyst Recommendations:

  • The Weir Group Plc: Deutsche Bank maintains its buy recommendation and raises the target price from GBX 3010 to GBX 3140.
  • Associated British Foods Plc: RBC Capital maintains its sector perform recommendation and raises the target price from GBX 2050 to GBX 2400.
  • Rightmove Plc: RBC Capital upgrades to outperform from sector perform and reduces the target price from GBX 805 to GBX 775.
  • Mondi Plc: Barclays downgrades to underweight from equalweight and reduces the target price from GBP 9 to GBP 7.60.
  • Astrazeneca Plc: Leerink Partners maintains its outperform recommendation and raises the target price from USD 85 to USD 87.
  • Diageo Plc: Morgan Stanley maintains its underweight recommendation and reduces the target price from GBX 1740 to GBX 1595.
  • Kier Group Plc: Deutsche Bank maintains its buy recommendation and raises the target price from GBX 235 to GBX 260.
  • J Sainsbury Plc: JP Morgan maintains its overweight recommendation and reduces the target price from GBP 3.63 to GBP 3.55.
  • Vistry Group Plc: Jefferies maintains its hold recommendation and reduces the target price from GBX 628 to GBX 608.