It’s been a busy final week of October. The Bank of Canada and the US Federal Reserve both trimmed rates, gold and silver prices pulled back, and Apple became only the third company in history to reach a $4 trillion valuation. But before we dive into the serious stuff, here’s a lighter headline: Halloween spending in the US is expected to hit a record-breaking $13.1 billion — that’s a lot of costumes and sweets for trick-or-treating!
Let’s begin in the US, where the government shutdown is on track to surpass the longest in history — 35 days. Meanwhile, the Federal Reserve, in a 10–2 vote, cut rates by 25bps to 4%. This decision came despite Fed Governor Miran once again advocating for a deeper cut, while Fed member Schmid voted against any reduction. The committee had limited information to guide their decision, making Chair Jerome Powell’s commentary on the future rate path all the more anticipated. His analogy summed it up: “What do you do if you’re driving in a fog? You slow down.” This suggests a potential pause at the December meeting, especially given the stark divide among members on how to tackle rising inflation amid a weakening labour market.
US President Trump and China’s President Xi met in Busan, South Korea, reaching a breakthrough in the ongoing trade war between the world’s two largest economies. A one-year deal was agreed, under which the US will reduce tariffs on Chinese goods in exchange for several key concessions: a crackdown on fentanyl trade, the purchase of 12 million tonnes of US soybeans, and the lifting of China’s ban on rare earth exports. The deal is expected to be formally signed in the coming weeks, though discussions continue around other contentious issues, including the ownership structure of TikTok and China’s access to Nvidia’s Blackwell GPU chips. President Trump also noted that the Russia–Ukraine war was a major topic of discussion, with both leaders expressing a commitment to work towards ending the conflict.
History is made every day and on Wednesday Nvidia powered ahead to become the first company ever to reach a $5 trillion market capitalisation. CEO Jensen Huang made a series of major announcements, including $500 billion in AI chip orders, and plans to build seven supercomputers for the US government, moves that further cement Nvidia’s dominance in the artificial intelligence race.
Apple became the third company ever to reach a $4 trillion market cap, a milestone further boosted by Thursday’s earnings report. This was the first earnings call since the launch of the popular iPhone 17 range, and Apple reported $102.5 billion in revenue, up 8% year-on-year. The share price has climbed more than 50% since its April low, driven by the strongest iPhone growth in nearly three years.
The European Central Bank (ECB) met on Thursday, with questions swirling ahead of the meeting. Not much has changed since September’s meeting, when policymakers said the economy was in a “good place.” However, inflation has begun to creep up to 2.2% — not yet a major concern, but worth monitoring as the full impact of tariffs remains unclear. The ECB’s decision to hold rates at 2.15% for a third consecutive meeting was unanimous, signalling an extended pause in rate cuts. President Christine Lagarde credited “a robust labour market, solid private sector balance sheets, and the ECB’s past interest rate cuts” as key sources of resilience in the eurozone economy.
Remaining in Europe, tensions flared within Novo Nordisk’s board this week as its largest shareholder, the Novo Nordisk Foundation, moved to take control. Led by Chairman Lars Sørensen, the Foundation is shifting focus sharply towards the US market in a bid to revive sales of the weight-loss drug Wegovy and regain ground lost to competitors like Eli Lilly. As a result, current Chair Helge Lund and six other board members will step down next month. This follows sweeping changes already underway under incoming CEO Mike Doustdar, who took over in August and has since led a global restructuring involving 9,000 job cuts. Novo Nordisk shares remain down 50% year-to-date.
November could be a busy month both here and across the Atlantic. The Bank of England meet on Thursday to discuss interest rates, while the much-anticipated UK Budget takes place towards the end of the month. With the US government shutdown expected to end at some point in the month, we could once again begin to receive economic data to help us assess the state of the largest economy in the world.
Nathan Amaning, Investment Analyst
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