Key Takeaways
- Amazon (AMZN) and Apple (AAPL) shares surged on robust earnings reports, with Amazon's revenue jumping 13% and Apple forecasting a "best ever" December quarter driven by strong iPhone 17 demand.
- ECB Governing Council member Olli Rehn indicated that the impact of tariffs on inflation appears disinflationary in the short to medium term, while noting both upside and downside risks to growth and inflation.
- European economic data presented a mixed picture, with Switzerland's real retail sales seeing a significant annual increase of 1.5% in September, while German retail sales also rose slightly month-over-month.
- Nvidia (NVDA) CEO Jensen Huang expressed hope to sell Blackwell chips to China despite current US restrictions, even as market share in China has reportedly fallen from 95% to zero.
- Oil prices are poised for their third consecutive monthly loss, pressured by a stronger dollar, oversupply concerns, and the anticipation of OPEC+ increasing supply.
Tech Giants Propel Market Optimism
Major US tech companies Amazon (AMZN) and Apple (AAPL) delivered strong earnings, fueling positive sentiment across global markets. Amazon's shares surged by 13% following a robust 13% revenue jump and strong performance in its cloud computing division, Amazon Web Services (AWS). The e-commerce and cloud giant reported its fastest cloud unit growth in nearly three years, driven by AI demand.
Similarly, Apple (AAPL) anticipates a "best ever" December quarter, buoyed by strong demand for its new iPhone 17 lineup. The company's fiscal fourth-quarter results exceeded analyst expectations, with revenue reaching $102.5 billion. This positive outlook from tech heavyweights supported US futures, which saw gains after the earnings releases.
Meanwhile, Nvidia (NVDA) CEO Jensen Huang stated his company still hopes to sell its advanced Blackwell chips to China, despite existing US export controls. Huang noted that Nvidia's market share in China for advanced AI chips has plummeted from 95% to virtually zero under current restrictions, emphasizing the importance of the Chinese market for funding US-based research and development.
ECB's Rehn on Inflation and Growth Risks
European Central Bank (ECB) Governing Council member Olli Rehn provided insights into the economic outlook, stating that the impact of tariffs on inflation appears to be disinflationary in the short to medium term. Rehn also highlighted that there are both upside and downside risks to growth and inflation, with the overall impact of tariffs remaining uncertain. He reiterated that there have been no major changes to the ECB's economic outlook since the September meeting.
Mixed Economic Signals Across Europe
Recent economic data from various European nations presented a varied picture. Switzerland's real retail sales saw a significant year-over-year increase of 1.5% in September, a notable improvement from the previous -0.2%.
In Germany, September's retail sales rose 0.2% month-over-month, exceeding the previous month's decline. However, the German Import Price Index showed a month-over-month decrease of -1.0% in September, though the year-over-year figure improved to 0.2%.
The UK housing market continued to show increases, with Nationwide reporting that house prices rose again in October by 0.3% month-over-month and 2.4% year-over-year, indicating resilience despite broader economic concerns.
Conversely, Norway's unemployment rate edged up to 2.2% in October, slightly higher than the previous 2.1%.
Global Commodities and Trade Developments
Oil prices are on track for their third consecutive monthly decline in October, with both Brent and WTI contracts expected to lose between 3% and 3.5%. This downturn is attributed to pressure from a stronger US dollar, concerns over a looming supply glut, and the anticipation of OPEC+ increasing production by an additional 137,000 barrels per day in December.
In other global trade news, South Korea and the US are reportedly nearing completion of a joint fact sheet on trade. Additionally, Chinese President Xi Jinping has welcomed Canada's Carney to visit China as Prime Minister, signaling potential diplomatic and economic engagements.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.