What moved
- US (closed): On Tuesday the S&P 500 closed 0.6% higher at 7,722.6 and the Nasdaq Composite rose 1.18% to 26,477.81. The Dow was almost flat, up 0.03%, because Boeing dragged on it. Futures are the only live read on today's US session: S&P 500 contracts are 0.06% higher and Nasdaq 100 futures are up 0.52%.
- Europe (closed): The DAX gained 0.71%, the CAC 40 0.51% and the Euro Stoxx 50 0.79%. The FTSE 100 was the exception, falling 0.75% to 10,686.54.
- Asia: Seoul led. The Kospi closed up 6.63% at 6,012.44 and Taiwan's benchmark finished 2.04% higher. The Nikkei closed up 1.08%, the Hang Seng is 0.24% higher and the Shanghai Composite is up 0.91%.
Why
Seoul's surge came from one company's results, but it lifted the whole chip sector. SK hynix's third-quarter operating profit was 83.3 trillion won, against roughly 76.7 trillion expected. It said its DRAM and high-bandwidth memory capacity is effectively booked and announced about 100 trillion won of shareholder returns. That eased fears that the AI-driven memory boom is close to its peak. SK hynix closed up 10.89% and Samsung Electronics up 9.01%. Foreign and institutional investors were net buyers while retail investors sold. The rebound followed a bad Tuesday for Asian tech, when the median stock in our Asia technology universe fell 3.77%.
On Wall Street, tech led again while energy lagged as oil eased on Gulf diplomacy. Iran's supreme leader backed pursuing Iran's conditions for ending the war, and that outweighed a Houthi-claimed missile strike on Saudi Arabia's Ras Tanura refinery. Boeing fell 10.69% after a wider-than-expected loss. The bigger blow was its guidance: chief executive Kelly Ortberg said 737 Max output will not reach 52 a month until the second half of 2027. After the close, NXP, Robinhood, Seagate and Visa all fell in extended trading despite headline beats, which shows the market is punishing cautious guidance.
London's fall came down to what the index holds. HSBC dropped 5.42% after third-quarter pre-tax profit of $9.6bn missed the $9.7bn expected, revenue fell short and the bank offered no guidance upgrade. BP and Shell slipped with crude.
Sentiment & risk appetite
Appetite for risk is firm but narrow. In our US universe, 3,597 stocks rose and 2,394 fell. The sector split was wide, though: technology rose 1.7% and energy fell 2.05%, so the gains depended on one theme. The VIX is little changed at 17.47. The MOVE index of bond-market volatility fell 4.22% to 97.87, so bond traders are calm ahead of the Fed. The US 10-year yield rose 0.7bp to 4.993%. Gold is not attracting safe-haven buying: it is down 0.68% at $4,046.8. The dollar index is 0.15% firmer at 102.47, within 0.5% of its 52-week high. Sterling is 0.47% weaker at $1.3283 going into the Budget.
Economic calendar
Today in the UK is about the Budget. Chancellor John Healey delivers his first at 12:30 GMT, after Prime Minister's Questions at midday. The Office for Budget Responsibility's forecasts and the Debt Management Office's updated gilt financing plans come out alongside it. Dealers expect this year's gross gilt sales to rise by £3.4bn to £249.6bn, and a lower figure could set off a gilt relief rally, since less new debt for the market to absorb supports prices. Expected measures include a minimum-wage rise, higher alcohol duty and a path for defence spending to reach 3% of GDP by the end of the decade.
The Fed announces its decision at 18:00 GMT (14:00 ET), followed by the press conference. Futures price only about a 12% chance of a hike today but roughly 90% odds of a 25bp rise in December, so the guidance matters more than the decision. Tuesday's US data were mixed: durable goods orders rose 1.8% against 1.5% expected, but core capital goods orders were softer than forecast.
Earnings
Most of Europe's bank-heavy 07:00 results came in ahead of expectations. Standard Chartered's pre-tax profit of $2.25bn beat the $2.09bn expected and it raised its income-growth guidance; its Hong Kong shares rose 2.5%. Deutsche Bank's €2.6bn pre-tax profit beat the €2.45bn forecast. UBS was mixed: revenue of $13.35bn beat, but net income of $2.69bn was a shade under expectations. BASF raised its EBITDA guidance.