German industrial production; no major corporate trading updates
Opening Call:
European stock futures were mixed, after Asia stocks also traded mixed. The dollar edged higher and U.S. Treasurys were flat. Gold and oil rose.
Equities:
European futures were mixed as gold topped $4,000 for the first time, with investors pouring money into precious metals and cryptocurrencies.
At the same time, U.S. President Trump is pledging to juice the economy through tax cuts and traders, pushing stocks to records with a fervor for all things artificial-intelligence.
“We’re seeing a tug of war,” said Joe Davis, chief economist at Vanguard Group.
“You’ve got the S&P 500 pricing in an AI supernova, and you’ve got the gold camp saying ‘We’re going to have structural deficits, we have fiscal pressure in the U.S., and I need to manage that risk.’ ”
Forex:
The U.S. dollar edged higher, with gold’s inverse relationship with the greenback seen to help bolster bullion prices in the months ahead, according to Commonwealth Bank of Australia analyst Vivek Dhar.
While both the U.S. dollar and gold futures have risen in tandem in recent days, gold and the greenback have had a strong negative correlation over the past year, Dhar said.
“Our expectation for the U.S. dollar to weaken by 4.4% by the end of Q1 2026 is likely to help gold prices lift further,” he said.
Bonds:
U.S. Treasurys were flat, with bonds and stocks trading in a narrow range since the federal government entered a shutdown last week, depriving investors of key economic data including a monthly jobs report that would have normally been released last Friday.
Investors continue to bet that the Federal Reserve will likely cut interest rates at each of its two remaining policy meetings this year.
“Unless there’s something that materially contradicts that pricing, it’s going to be difficult for markets to move substantially,” said Gennadiy Goldberg, head of U.S. rates strategy at TD Securities.
Energy:
Oil rose amid lingering supply disruption risks.
The Russia-Ukraine conflict has entered a new phase in recent months, with Ukraine pursuing an intense long-range drone campaign targeting Russia’s oil sector, Capital Economics’ Kieran Tompkins said.
“The damage to Russian refinery and export capacity so far, and the prospect of more meaningful disruption, suggests that the upside risk to oil prices has increased,” said the senior climate and commodities economist.
Metals:
Gold edged higher, supported by possible hedging demand.
October is known for big equity sell-offs and risks are riding quite high, the World Gold Council said in commentary.
“Gold is generally a good hedge, but there may be concerns about its ability to respond given how stretched it looks,” the council said, suggesting that these worries aren’t warranted and that, absent a liquidity crunch, gold’s hedging credentials remain intact.
–
Copper declined, as investors take profit after recent gains.
Prices surged to their highest level in more than a year amid supply disruptions at major mines in Indonesia and Chile following accidents.
Supply concerns remain a supportive factor, ANZ Research analysts said, adding that copper is also likely to find some support on expectations that the Fed will cut interest rates.
TODAY’S TOP HEADLINES
A New Wall Street Trade Is Powering Gold and Hitting Currencies
Investors worried about the future of the dollar and other major currencies are piling into gold, bitcoin and other alternative assets, powering what has become known on Wall Street as the debasement trade.
Traders have snapped up gold since Federal Reserve Chair Jerome Powell signaled in August that the central bank would begin cutting interest rates despite low unemployment and above-target inflation, pushing prices to records. Most-actively-traded gold futures on Tuesday surpassed $4,000 a troy ounce for the first time.
Gold Prices Top $4,000 for First Time
Gold surpassed $4,000 a troy ounce for the first time, signaling an investor rush into alternative assets at a time of concern about the outlook for the U.S. economy and its place in the world.
The price of the precious metal has surged this year more than it did during some of America’s biggest crises. Rising more than 50%, futures’ run-up in 2025 has outpaced rallies during the pandemic and 2007-09 recession. Not since the inflationary shock of 1979 has gold catapulted so much higher in a year.
Glencore Gets Government Bailout for Australian Copper Smelter, Refinery
Glencore will get a government bailout valued at up to 600 million Australian dollars, equivalent to US$395 million, to keep its Mount Isa copper smelter and Townsville refinery in Australia’s Queensland state open for the next three years.
The Swiss commodities giant has been losing money from the smelter and refinery because of a China-led oversupply in smelting capacity and high Australian energy costs, among other reasons, and warned officials it would close the operations without government support. Glencore has been in talks for the past eight months with Australia’s federal and Queensland state governments, which will share the costs of the bailout equally.
Tesla Debuts Cheaper, Stripped-Down Versions of Model 3 and Model Y
Tesla has long promised a cheaper model. On Tuesday, the company unveiled stripped-down versions of its bestselling SUV and sedan, but the new lower prices don’t quite cover the recently expired $7,500 EV tax credit.
Tesla introduced a “standard” Model Y and Model 3 that lack features such as wraparound ambient lighting and power-adjusted steering wheels, hoping to draw in budget-conscious buyers.
Hyundai Gets Cold Shoulder From Trump Despite Charm Offensive
SEOUL-Hyundai Motor Group Executive Chair Euisun Chung hoped the automaker could appease the Trump administration with a series of aggressive moves to deepen its ties to the U.S.
All times in GMT. Powered by Onclusive and Dow Jones.
Write to us at [email protected]
We offer an enhanced version of this briefing that is optimized for viewing on mobile devices and sent directly to your email inbox. If you would like to sign up, please go to https://newsplus.wsj.com/subscriptions.
This article is a text version of a Wall Street Journal newsletter published earlier today.
