Market Report.
💼 According with CNBC, Josh Brown, CEO of Ritholtz Wealth Management, stated that the stock market is currently going through a market-wide correction, even if the major indexes have not yet reflected it:
📊 Over 30% of S&P 500 stocks are more than 20% below their 52-week highs, suggesting many stocks are actually in a bear market. At the same time, 6.5% of S&P 500 companies are currently trading at 52-week lows. This internal weakness in the market has started to bubble to the surface, with the S&P 500 losing over 1% on Tuesday, driven by weakness in AI-related names.
💰 The proliferation of debt financing, both in traditional and alternative forms, that is fueling the AI industry’s infrastructure expansion, raises questions about potential bubbles and risks building up in parts of the financial system.
🏦 Investment grade borrowing by AI-focused tech giants has surged, with $75 billion in deals in just Sept-Oct 2025, more than double the sector’s annual average.
💹 Oracle’s soaring share price contrasts with rising credit default swap levels, indicating investor concerns about its debt levels.
⚠️ The high-yield “junk bond” market is also seeing a spike in AI-related issuance, reaching levels last seen in 2021’s peak.
🤝 Private credit is playing an increasingly important role in funding the data center buildout, with estimates it could supply over half the $1.5 trillion needed by 2028.
📦 Securitized products like asset-backed securities (ABS) are also expanding rapidly to finance data centers, raising concerns about the complexity and liquidity of these instruments.
🏙️ Zohran Mamdani, the democratic socialist candidate, has won a decisive victory in the New York City mayoral election, despite facing fierce opposition from the city’s business elite: Wealthy antagonists like billionaire Bill Ackman launched relentless attacks against Mamdani, decrying his ascendance as the start of “hot commie summer.”
🗽 However, after Mamdani’s victory, some in the business community are now adapting to the new reality and pledging to work with the mayor-elect, even if they don’t share his political views. Figures like Ralph Schlosstein of Evercore and Citigroup CEO Jane Fraser are saying they hope to collaborate with Mamdani and help make the city successful. Crypto billionaire Mike Novogratz and JPMorgan CEO Jamie Dimon, who previously criticized Mamdani, are also now offering to assist the new mayor.
🗣️ Zohran Mamdani, the newly elected Mayor of New York, introduced himself with a bold statement: “I am young despite my best efforts to grow older. I am Muslim. I am a democratic socialist, and most damning of all, I refuse to apologize for any of this.”
🇨🇳 China’s services activity expanded in October, but at the slowest pace in three months: The RatingDog China General Services PMI, compiled by S&P Global, slipped to 52.6 from 52.9 in September, staying above the 50-mark that separates growth from contraction.
📈 The services sector growth was driven by faster expansion in new business, while new export business contracted for the first time in four months, with respondents citing global trade uncertainties. The Composite Output Index, reflecting weaker output growth across both manufacturing and service sectors, fell to 51.8 in October from 52.5.
💱 Chinese firms are becoming more open to using the yuan for transactions, even if they are not doing business with US companies, due to concerns over the US dollar. The yuan’s prominence in China’s cross-border trade is rising, with yuan-denominated trade accounting for about 30% of the total trade volume in the first three quarters of 2025. Certain sectors like light industrial products, clothing, electronics, toys and furniture show stronger interest in using the yuan, while industries like commodities are more reluctant.
🗣️ Chinese Premier Li Qiang made the following remarks at the China International Import Expo: China’s economy is expected to surpass 170 trillion yuan ($23.9 trillion) in the next 5 years, representing “new significant contributions to global growth.” Li criticized “unilateral and protectionist measures” that have severely impacted the international economic and trade order, and said China will work with other countries to promote stable and unimpeded global supply chains.
🛍️ China’s next five-year plan signals a growing resolve to promote consumption and reduce reliance on exports, as other countries push back on China’s cheap goods flooding global markets.
⛽ China is making a massive push to boost its domestic oil and gas production to reduce reliance on imports and insulate itself from geopolitical risks: China has spent $468 billion on drilling and exploration since 2019, a 25% increase from the previous 6 years, making PetroChina the world’s biggest spender on upstream investment.
🛢️ This drilling boom is being driven by President Xi Jinping’s call for boosting domestic energy security, especially after trade tensions with the U.S. and sanctions on Russia. China’s oil and gas majors like PetroChina, CNOOC and Sinopec have rapidly expanded their production capacity, with offshore fields in the Bohai Sea becoming the largest producing region.
🏗️ The scale of China’s investments in upstream oil and gas dwarfs spending by international majors like Exxon, Shell and BP, signaling Beijing’s determination to achieve energy self-reliance. China’s domestic oil production is expected to plateau, but its natural gas output has significant room for growth to reduce reliance on imported LNG.
🌏 Are we witnessing an unannounced new Bretton Woods? Rare earth elements are transitioning from a commodity to a “currency of trust” – a political tool to select which countries and companies are allowed access. This allows China to regulate the pace of global technological transformation and decide who will participate in the new era, wielding influence through the supply chain.
⚙️ The West has become dependent on China for these critical materials, undermining its own “sovereignty” and forcing it to imitate China’s resource control tactics. China’s quiet, precise diplomacy using rare earth export controls is reshaping global power dynamics, as the Global South sees stability in Beijing’s approach compared to Western sanctions.
🌐 Power is shifting from financial centers to the control of critical raw materials, diminishing the influence of traditional Western economic and political instruments.
📊 Market View.
📉 US futures experienced corrections during yesterday’s session, fuelling fears of an AI bubble. The Nasdaq saw declines of over 2.5% at its worst moments. S&P 500 futures have fallen below 6,800, now trading at 6,790 points, while Nasdaq futures are below 25,500.
💵 The dollar continues to strengthen, with the DXY index surpassing 100 points. As a result, EUR/USD has fallen below 1.15 and GBP/USD below 1.31.
🇪🇺 In Europe, futures opened lower following Wall Street’s declines. DAX 40 futures have dropped towards 23,650 points in recent hours, while EuroStoxx 50 futures are struggling to hold their 200-period intraday moving average, trading just above 5,600 at 5,630 points.
🛢️ Crude oil remains hesitant but relatively firm, with Brent crude trading at $64.40 per barrel.
🥇 Gold futures once again fell below $4,000 per ounce yesterday but have since rebounded slightly to around $3,980.
💻 Bitcoin briefly dropped below $100,000 in recent hours but has bounced back to its current level of $101,900.
