Markets enter November upbeat. Global bourses climbed on strong corporate earnings and calmer trade relations, lifting U.S. futures and most exchanges. That tone matters now because this week brings a Supreme Court hearing on the legality of broad tariffs and OPEC+ moves that could reshape oil supply expectations. In the short term investors will watch earnings flow, U.S. manufacturing surveys and Treasury yields. Over the long term rising corporate leverage tied to an AI capex boom, underlined by Meta Platforms (NASDAQ:META) selling $30 billion of bonds, may compete with government borrowing. Regional contrasts are clear, with Asia showing weak factory readings while Western markets gain on profit momentum.
Market backdrop and immediate drivers
World markets opened November in an upbeat mood, reacting to a mix of buoyant corporate earnings and signals of calmer trade relations. Wall Street index futures pointed higher ahead of the U.S. session, while Treasury yields edged lower from Friday highs and the dollar nudged up to three month highs. Crude prices held steady after OPEC+ agreed a small rise in output for December and then paused increases for the first quarter of next year. That decision met market expectations while also providing an element of surprise, and it leaves oil markets watching for demand cues and geopolitical risks.
Investor attention is concentrated on a cluster of near term events that can move sentiment quickly. U.S. manufacturing surveys from S&P Global and ISM will give fresh readings for October. The Supreme Court will hear arguments on the legality of sweeping tariffs on Wednesday. And corporate earnings continue to shape the story with a third quarter that now looks stronger than early in the year suggested.
Earnings strength is driving risk appetite, but leverage is creeping
Corporate America delivered an impressive third quarter overall. LSEG data shows estimated annual profit growth for the S&P 500 running at almost 14 percent for Q3. That pace is five percentage points faster than a month ago and better than the outlook investors expected at the start of the year. The upgrade in profit growth helps explain why markets were willing to look past softer factory surveys in Asia.
However, the earnings glow comes with a cautionary note on funding. Big tech spending on artificial intelligence has accelerated capital expenditure plans. That push appears to be drawing on debt markets as well as corporate cash. Meta Platforms (NASDAQ:META) last week issued about $30 billion of bonds to help fund AI investment. This move highlights a potential competition for capital between large corporates and the U.S. Treasury. If more companies follow suit the result could be upward pressure on corporate leverage and an additional layer of demand for fixed income markets.
Policy, legal risks and central bank signals to watch
Policy and legal events are central to the near term picture. The U.S. Supreme Court will consider whether the administration overstepped its authority in imposing broad global tariffs under a 1977 emergency law. A ruling against the current approach could create a temporary hiatus in how tariffs are implemented and even raise the prospect of rebates for some firms. Administration officials say alternate legal routes exist to maintain at least some measures, but the hearing injects uncertainty into trade policy just as firms digest recent talks between the U.S. and China.
At the Fed front, some bank presidents expressed discomfort with easing on Friday. That contributed to traders pricing about a 68 percent chance of a 25 basis point cut in December. Treasury Secretary Scott Bessent said parts of the U.S. economy, notably housing, may already be in recession because of high rates and urged the central bank to move faster. Those comments keep attention fixed on how policy makers will weigh growth and inflation risks while markets price potential rate moves.
Global trade, manufacturing and regional contrasts
Asia’s manufacturing hubs showed weakness in October as weak U.S. demand and tariff frictions dented factory orders across the region. Those readings contrast with stronger profit trends in the United States, producing a bifurcated backdrop for global growth expectations. After last week’s meeting between the U.S. president and China’s leader the White House said China would lift export controls on rare earths and end probes into U.S. chip firms. At the same time the U.S. administration signaled restrictions on the most advanced chips from Nvidia (NASDAQ:NVDA) for some overseas markets.
Those trade moves carry both immediate and longer run implications. In the near term easing of some controls can support supply chains and reduce headline trade risk. Over time restrictions on advanced technology flows and export controls can shape investment decisions in semiconductors and related sectors.
Commodities, earnings calendar and what to watch in trading
Energy markets are responding to both OPEC+ messaging and conflict related strains on Russian oil. Western refiners have enjoyed stronger margins because attacks on Russian oil infrastructure have tightened certain supply channels. That headwind to volumes for some exporters has supported refining profits and helped blunt concerns over a burgeoning supply glut.
The U.S. earnings calendar for the coming session includes a mixed set of names that can add to market nuance. Palantir (NYSE:PLTR) and Eastman Chemical (NYSE:EMN) are among the companies reporting, with a broader slate that includes Clorox (NYSE:CLX), IDEXX Laboratories (NASDAQ:IDXX), Progressive (NYSE:PGR), ON Semiconductor (NASDAQ:ON), Coterra Energy (NYSE:CTRA), Diamondback Energy (NASDAQ:FANG), The Williams Companies (NYSE:WMB), Loews (NYSE:L), Vertex Pharmaceuticals (NASDAQ:VRTX), Hologic (NASDAQ:HOLX), Pinnacle West (NYSE:PNW), SBA Communications (NASDAQ:SBAC), Public Service Enterprise Group (NYSE:PSEG), Simon Property Group (NYSE:SPG) and Realty Income (NYSE:O).
Traders should watch how earnings outside the red hot AI cohort influence broad equity sentiment. Stocks that beat on cash flow and guidance could sustain the optimistic start to November. Conversely elevated corporate bond issuance to fund capex would be an important signal for fixed income, given the potential for overlap with Treasury funding needs.
For the trading session ahead the tone looks constructive but sensitive. A stronger than expected run of corporate reports and reassuring manufacturing data would reinforce Friday’s gains. A contrary Supreme Court outcome on tariffs or a sharp move in yields would quickly recalibrate risk appetite. Markets are pricing a cautious path for policy easing. The interaction between heavy AI investment, shifting trade policy and central bank signals will be the core story to watch as the month begins.
