OPENING CALL
Stock futures fell as investors waited on the Federal Reserve's rate decision on Wednesday, its last of the year.
Fed policymakers are expected to agree to lower interest rates, a trend which Nomura Capital Management said could continue next year given the slowing pace of inflation and labor-market softness. New economic projections should reflect a tempered pace of inflation in the next few quarters, opening the possibility for another rate cut, it said.
A 25-basis-point rate cut on Wednesday is priced with a 89% probability, according to LSEG.
While Nomura acknowledges the Fed committee is divided, Neuberger Berman holds the view that rates will fall irrespective of what the Fed decides this week.
"While market expectations on the Federal Reserve making a quarter-point cut to rates on Dec. 10 have flip-flopped wildly over recent weeks, what is most important is the overall easing bias the central bank is engaged in and the constructive implications this has for the U.S. economy and risk markets."
Neuberger Berman added it expected a lower and more accommodative Fed funds rate into the second half of next year.
Meanwhile, Trump was set in coming days to start the final round of interviews with candidates to be the next chair of the Federal Reserve. Among them are former Fed governor Kevin Warsh and Kevin Hassett, the director of the National Economic Council.
Stocks to Watch
Amazon shares were 0.2% up after it said it will invest $35 billion across its businesses in India over a five-year period.
Cracker Barrel shares fell 8.3% after it reported its earnings and cut its profit outlook for its current fiscal year.
EchoStar was 5.8% up, continuing an upward trend after a report SpaceX might go public in 2026.
GameStop traded 6.4% lower after it reported a decline in quarterly revenue.
GE Vernova shares rose 7.5% after the company raised its financial guidance and increased its dividend and share-buyback authorization.
Nvidia shares edged 0.2% lower as investors considered whether U.S. plans to allow exports of AI chips to China will lead to higher sales.
Palantir Technologies shares rose 1.4% after it won a contract with the U.S. Navy to manage the supply chain of nuclear submarines.
Watch For:
U.S. Employment Cost Index for 3Q; EIA Weekly Petroleum Status Report; Oracle 2Q earnings; U.S. interest rate decision; Federal Reserve economic projections; Bank of Canada rate decision; earnings from Adobe and Oracle.
Today's Top Headlines/Must Reads:
- Can Nissan Reverse Its Decade-Long Slide in the U.S.?
- Silicon Valley Is Racing to Make Critical Minerals-and Blunt China's Dominance
- A Billion-Barrel Oil Glut Is Forming at Sea
MARKET WRAPS
Forex:
The dollar declined against a basket of currencies as risks surrounding the Fed's policy meeting were skewed towards less hawkish commentary and a willingness to further cut rates , ADSS said.
The dollar would weaken should the Fed be more open to further rate cuts, while stocks and metals should rise, it said.
The dollar could receive a limited boost
by the Fed's monetary policy, but the rally might not last in the face of pressure from weak jobs data next week and seasonal December weakness, ING said.
The euro rose against the pound and sterling needs favorable news about economic growth for it to strengthen versus the EU's single currency, Insight Investment said.
"We continue to favor Scandinavian currencies over sterling given a more robust economic outlook and prudent central bank policy."
Bonds:
Two-year and 10-year Treasury yields edged lower, suggesting investors already positioned themselves
ahead of the Fed's policy decision, according to MFS Investment Management.
"The Fed will likely try hard to sound cautious and deliver some hawkish undertones, mainly because the Fed wants to keep maximum policy flexibility," it said.
Metals:
Gold prices
slipped, but continued to hold above the $4,200 mark as investors awaited the Fed's interest-rate guidance for next year. Futures in New York were down.
"A slump in U.S. government bonds over the past few days has curbed risk appetite, as traders grow cautious about the pace of monetary easing," ANZ Research said.
Silver prices
continued to climb, hitting fresh record highs as investors bet on an imminent interest-rate cut in the U.S.
"Although inventory pressures have eased as shipments boosted London vault stocks, tight conditions in the over-the-counter market and tariff-related concerns have kept prices elevated," MUFG said.
Energy:
Oil prices
held broadly steady as investors tracked diplomatic efforts to end the war in Ukraine and looked to Fed Chair Jerome Powell's remarks on interest rates.
Traders now await monthly reports from OPEC and the IEA on Thursday for further clues on crude's outlook.
TODAY'S TOP HEADLINES
CEOs Are All-In on AI
Chief executives are bullish on the broad economic impact of artificial intelligence, but do expect it to weaken the job market, according to a new survey.
Despite investor concerns that AI spending is becoming overdone, 85% of chief executives believe the technology is entering a healthy growth phase rather than a bubble, according to research from global marketing network Stagwell. The poll asked respondents to select statements closest to their own views.
IBM Once Dominated Computing. Quantum Technology Could Put It on Top Again.
Inside IBM's main research center rises a maze of silver towers, each 22 feet tall. Through their vented flanks, you catch glimpses of blinking lights and the shadows of wires. The machine's three-chambered heart-comprised of three processors, each no larger than a fingernail-is hidden from view.
Step closer and you hear the contraption appearing to breathe, a tinkling sound like wind chimes emanating from the cooling mechanism that keeps its innards colder than outer space. It's the sound of the future.
Oracle Earnings Face Pressing Questions About OpenAI and Profit Margins
Since Oracle's last earnings report three months ago, the stock has had a rocky ride. Shares initially jumped 36% on news that the company's backlog had risen by over $300 billion. But then came the wrinkle that the huge increase was driven by a single contract with OpenAI, a loss-driven AI start-up that doesn't have $300 billion and faces an unclear path in raising it. Oracle stock is down 33% since that news.
Coupang CEO Resigns Over Data Breach in South Korea
Coupang Corp. Chief Executive Park Dae-jun has resigned over what is viewed as the worst data-breach case in South Korea.
Coupang Inc., the U.S.-listed parent, said Wednesday that Chief Administrative Officer & General Counsel Harold Rogers has been named interim CEO of Coupang Corp. after Park stepped down because of a leak of personal information of more than 30 million customers.
Aegon Shares Slide on Plans to Shift to U.S., Potential Job Cuts
Aegon shares fell after the Dutch insurer and asset manager outlined plans to relocate its business to the U.S. and rebrand as Transamerica Inc., a move that could affect its Netherlands-based workforce.
In European morning trading, shares were down 53 European cents, or 7.6%, at 6.36 Euros. Year to date, shares have risen 11%.
Massive Debt-Fueled Deals Are Back on Wall Street
The megadeal is back and so is Wall Street's immense appetite for debt.
Paramount's hostile bid for Warner Bros. Discovery this week, the leveraged buyout of gaming company Electronic Arts earlier this year and other recent debt-laden transactions have all been possible thanks to a spike in lending by banks and even some private-credit funds.
Trump and U.S. CEOs Agree: European Red Tape Goes Too Far
BRUSSELS-President Trump doesn't have many good things to say about Europe these days. Neither do some of America's most powerful CEOs.
The new U.S. National Security Strategy, a foreign-policy declaration that shocked European leaders with its harsh language about the continent, echoed complaints from American executives about what they see as the European Union's oppressive business regulations.
China's Consumer Inflation Ticks Up, But Factory Deflation Worsens
China's consumer inflation gained pace in November but was slightly below expectations, benefiting from a low base while factory deflation worsened.
The country's consumer-price index rose 0.7% from a year earlier last month, surpassing October's 0.2% increase and marking the second straight month of improvement, data released by the National Bureau of Statistics showed Wednesday. A poll of economists by The Wall Street Journal had predicted the index to rise 0.8%.
Asia Shows Economic Resilience in Year of Tariffs, But Growth Set to Slow, ADB Says
SINGAPORE-Asia's economies have fared better than expected in a year dominated by U.S. tariff threats but growth will slow next year, the Asian Development Bank said.
A surprisingly strong showing by India-Asia's third-largest economy-offset a deceleration in China, the ADB said as it raised its 2025 growth forecast for the region.
Venezuela's Machado Won't Collect Peace Prize in Person, Says Nobel Official
Venezuela's María Corina Machado won't collect the Nobel Peace Prize in person at Wednesday's ceremony in Oslo, the head of the Norwegian Nobel Institute said, despite the opposition leader having signaled she would brave the trip to Norway and the risk of being forced into exile that came with it.
Institute head Kristian Berg Harpviken told Norwegian broadcaster NRK Wednesday that she wasn't in Norway and wouldn't appear at the event. He added it was unclear whether Machado would make it to Oslo at all.
Russian and Chinese Bombers Fly Joint Patrol Close to Japan
TOKYO-Russian and Chinese bombers flew near Japan and South Korea in a joint patrol Tuesday that Tokyo described as a show of force, adding further strain to the worst diplomatic crisis in years between Tokyo and Beijing.
The military exercise, which Russian state media said lasted around eight hours, comes amid a series of Chinese reprisals against Tokyo over remarks last month by Japanese Prime Minister Sanae Takaichi suggesting that Japan might be dragged into any conflict over Taiwan, the self-ruled island that Beijing claims as its own.
America Has a New Ally in Syria and Wants Israel to Get on Board
TEL AVIV-Israel's aggressive posture toward the new government in Syria has emerged as a rare point of disagreement with Washington, where President Trump wants a quick resolution to the two countries' decades-old tensions.
After the collapse of Bashar al-Assad's regime a year ago, Israel carved out a 155-square-mile area inside Syria that it still holds. Since then, it has carried out arrests, seized weapons and conducted frequent airstrikes in the south of the country. Over the summer, Israel struck Syria's military headquarters in Damascus in what it said was an effort to defend the Druze minority, which has strong ties to Israel, from sectarian attacks.
Trump Touts Economy in Pennsylvania Speech, Blaming Democrats for Rising Costs
President Trump touted the performance of the economy under his administration as he delivered the first of what is likely to be several speeches to address voters' concerns about affordability, telling a Pennsylvania crowd Tuesday night that the Biden administration was to blame for rising prices.
"They gave you high prices, they gave you the highest inflation in history, and we're giving you, we're burning those prices down rapidly," Trump said of Democrats. For nearly two hours, he listed what he called his successes in his first 10 months in office and also meandered into several issues away from the economy, such as national security, immigration policy and attacks on his predecessor, former President Joe Biden.
Trump Pushes Ukraine to Accept Peace Deal, Saying It Is Losing
President Trump dialed up pressure on Ukraine to swiftly accept a U.S.-designed peace plan, hardening his position toward the embattled country and its European backers, who insist U.S. security guarantees are vital to a peace deal.
Exacerbating tensions between Europe and Washington, Trump lambasted European leaders as weak and said Russia holds the cards in any peace negotiation with Ukraine.
Write to pierre.bertrand@wsj.com
TODAY IN CANADA
Earnings:
D2L Inc. 3Q
Evertz Tech Limited 2Q
Major Drilling Group International Inc. 2Q
TerraVest Industries 4Q
Economic Indicators $(ET)$:
0945 Bank of Canada interest rate announcement
Stocks to Watch:
North West Co. 3Q Sales C$634.3M; 3Q Same-Store Sales Down 1.7%; 3Q EPS C$0.82
Air Transat: Reaches Tentative Agreement With Pilots Union; Agreement Eases Risk of Strike; Deal With Union Marks 'Complete Overhaul' of Collective Agreement; Agreement Will Be Submitted for Ratification by Union Members in Coming Days; Priority Now Is to Quickly Restore Operations to Normal
Canacol Energy Enters Into Agreement With Ad Hoc Group of Holders of Its 5.75% Senior Unsecured Notes Due 2028 for Debtor-In-Possession Financing; DIP Financing Will Bear Customary DIP Interest and Fees, Mature June 30, 2026; DIP Financing Will Be Secured by Court-Ordered Super-Priority Charge Over All of the Company's and Its Operating Subsidiaries' Assets; DIP Financing Proceeds Will Be Used to Fund Operations and Restructuring Costs; DIP Financing Proceeds Will Also Go Toward Facilitating Renewal or Replacement of Required Letters of Credit
Other News:
Distressed Funds Snap Up First Brands' Top Loans to Drive Debt Restructuring
Expected Major Events for Wednesday
09:00/ITA: Oct Industrial Production
12:00/US: 12/05 MBA Weekly Mortgage Applications Survey
13:30/US: 3Q Employment Cost Index
14:45/CAN: Bank of Canada interest rate announcement
15:30/US: 12/05 EIA Weekly Petroleum Status Report
19:00/US: Nov Monthly Treasury Statement of Receipts and Outlays of the U.S. Government
19:00/US: Federal Reserve economic projections
19:00/US: U.S. interest rate decision
23:50/JPN: 4Q Business Outlook Survey
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Expected Earnings for Wednesday
ADF Group Inc (DRX.T) is expected to report $0.22 for 3Q.
Adobe Inc $(ADBE)$ is expected to report $4.29 for 4Q.
Amtech Systems Inc (ASYS) is expected to report $-0.03 for 4Q.
AstroNova Inc (ALOT) is expected to report for 3Q.
BMTC Group Inc (GBT.T) is expected to report for 3Q.
Chewy Inc $(CHWY)$ is expected to report $0.12 for 3Q.
Culp Inc $(CULP)$ is expected to report $0.23 for 2Q.
DLH Holdings Corp (DLHC) is expected to report $0.02 for 4Q.
Daktronics Inc (DAKT) is expected to report $0.27 for 2Q.
Electrovaya Inc (ELVA.T) is expected to report $0.05 for 4Q.
Evertz Technologies (ET.T,EVTZF) is expected to report $0.18 for 2Q.
Hall of Fame Resort & Entertainment Co $(HOFV)$ is expected to report for 3Q.
JJill Inc $(JILL)$ is expected to report $0.56 for 3Q.
Kewaunee Scientific Corp $(KEQU)$ is expected to report for 2Q.
Major Drilling Group International Inc (MDI.T,MJDLF) is expected to report $0.26 for 2Q.
Nordson Corp $(NDSN)$ is expected to report $2.73 for 4Q.
Office Properties Income Trust $(OPITS)$ is expected to report for 3Q.
Oracle Corp $(ORCL)$ is expected to report $1.20 for 2Q.
Oxford Industries Inc $(OXM)$ is expected to report $-1.00 for 3Q.
Photronics Inc $(PLAB)$ is expected to report $0.47 for 4Q.
Planet Labs PBC $(PL)$ is expected to report $-0.08 for 3Q.
Rafael Holdings Inc $(RFL)$ is expected to report for 1Q.
Rev Group Inc $(REVG)$ is expected to report $0.74 for 4Q.
Skillsoft Corp $(SKIL)$ is expected to report for 3Q.
Synopsys Inc $(SNPS)$ is expected to report $-0.24 for 4Q.
Transcontinental Inc - Class A (TCL.A.T,TCL.B.T,TCLAF) is expected to report for 4Q.
Uranium Energy Corp (UEC) is expected to report for 1Q.
Vail Resorts Inc (MTN) is expected to report $-5.00 for 1Q.
VersaBank (VBNK.T) is expected to report $0.25 for 4Q.
Wall Financial Corp (WFC.T) is expected to report for 3Q.
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ANALYST RATINGS ACTIONS
Confluent Cut to Hold From Overweight by Deutsche Bank
Alexander & Baldwin Cut to Neutral From Overweight by Piper Sandler
Colgate-Palmolive Raised to Outperform From Sector Perform by RBC Capital
Confluent Cut to Hold From Buy by Canaccord Genuity
Confluent Cut to Hold From Buy by Needham
Confluent Cut to Market Perform From Outperform by Raymond James
Confluent Cut to Neutral From Buy by DA Davidson
Confluent Cut to Neutral From Buy by UBS
Confluent Cut to Perform From Outperform by Oppenheimer
Confluent Cut to Sector Perform From Outperform by RBC Capital
FMC Corporation Cut to Underweight From Equal-Weight by Barclays
Gogo Cut to Market Perform From Outperform by William Blair
Intel Raised to Outperform From Hold by KGI Securities
Lyell Immunopharma Raised to Buy From Neutral by HC Wainwright & Co.
Norwegian Cruise Line Cut to Neutral From Buy by Goldman Sachs
RPM International Raised to Outperform From Sector Perform by RBC Capital
Sallie Mae Cut to Equal-Weight From Overweight by Morgan Stanley
Sallie Mae Cut to Sell From Buy by Compass Point
Synopsys Raised to Buy From Neutral by Rosenblatt
Vertiv Holdings Cut to Peer Perform From Outperform by Wolfe Research
Warner Bros. Discovery Cut to Neutral From Buy by Seaport Global
This article is a text version of a Wall Street Journal newsletter published earlier today.
(END) Dow Jones Newswires
December 10, 2025 06:08 ET (11:08 GMT)
Copyright (c) 2025 Dow Jones & Company, Inc.
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