Oracle stock falls after report reveals thin margins in AI cloud business
Global markets began the week with cautious optimism. The victory of a pro-stimulus candidate in Japan renewed confidence in Asian equities, while investors in the United States focused on the Federal Reserve’s upcoming minutes amid the continuing government shutdown. Oil, gold, and Bitcoin each reflected different dimensions of the same uncertainty: fiscal fragility, policy hesitation, and a rising appetite for alternative assets.
Stimulus Hopes Lift Asia While U.S. Markets Await Clarity
Japanese equities led global gains after Sanae Takaichi won the leadership race for Japan’s ruling party, signaling support for expansionary fiscal and monetary policies. The Nikkei 225 rose by nearly 5 percent as exporters benefited from a weaker yen, which slid toward 150 per dollar. Investors interpreted her victory as a commitment to sustained economic stimulus rather than an early withdrawal of policy support.
In contrast, U.S. stock futures advanced more modestly.
The S&P 500 and Nasdaq contracts both gained around 0.3 percent, reflecting restrained optimism as the federal government shutdown entered another week. With the release of official economic data suspended, traders are turning to the Fed’s meeting minutes on Wednesday and the University of Michigan consumer sentiment survey on Friday to gauge the direction of inflation and growth expectations.
Yields Rise and the Dollar Strengthens
Long-term U.S. Treasury yields climbed as investors priced in a prolonged period of tight monetary policy. The 10-year yield rose to around 4.15 percent and the 30-year to nearly 4.76 percent. A firmer dollar accompanied the move, reaching a 10-day high near 98.2 on the DXY index.
The rise in yields, combined with a stronger currency, suggests that markets continue to doubt the near-term likelihood of significant rate cuts. For equity investors, this environment limits multiple expansion even if earnings remain steady.
Oil Finds Support, Gold Extends Its Rally
Oil prices advanced as OPEC+ confirmed only a modest output increase of 137,000 barrels a day for November. The restrained production growth, identical to October’s pace, reflected a desire to maintain price stability amid weakening global demand. Brent traded around $65 per barrel and WTI near $62, with energy equities gaining moderate support from the decision.
Gold continued its ascent, surpassing $3,900 per ounce to reach another record high. Persistent fiscal uncertainty in Washington and renewed geopolitical risks have reinforced its role as a hedge against both inflation and political instability. Central bank accumulation of reserves and lower real yields have added structural momentum to the rally, suggesting that investors now view gold as a strategic rather than tactical allocation.
Bitcoin Emerges as a Political Hedge
Bitcoin climbed further, holding near $124,000 after briefly touching a record of $125,000. Its rise reflects a convergence of macro factors: the U.S. fiscal standoff, European political uncertainty, and the search for assets beyond the reach of central banks.
The growing correlation between Bitcoin and gold highlights its transformation into a perceived store of value, though volatility remains far higher. Institutional investors appear increasingly willing to treat digital assets as complementary hedges in an era of persistent policy risk.
Investor Outlook
Markets are entering a phase where sentiment diverges from fundamentals. Japan’s renewed commitment to stimulus offers short-term support for global cyclicals, yet sustained progress in U.S. equities will depend on signals from the Fed minutes. A stronger dollar and higher yields may continue to restrain valuations. Meanwhile, gold and Bitcoin’s parallel strength reveal deeper unease about the stability of fiscal and monetary frameworks across major economies.
For investors, the opportunity lies in diversification. Exposure to sectors tied to fiscal expansion and commodities may provide resilience, while gold and digital assets remain essential tools for hedging against policy uncertainty. The common thread across asset classes is clear: markets are no longer simply pricing growth or inflation but the credibility of policymakers themselves.