Global markets rally on US-China trade optimism and Argentina election surge. Stocks climbed to fresh highs as reports of a preliminary US-China trade framework gave investors breathing room, while Argentina’s convincing mid-term victory for President Javier Milei’s ruling party sparked a sharp local relief rally. Short term, markets took risk on, lifting equities, local bonds and the peso. Over the longer term, questions remain about whether policy moves and external support translate into sustained stability in Argentina and whether the US-China agreement avoids the false starts seen earlier this year. The headlines matter now because upcoming central bank meetings and a packed data and earnings calendar could either reinforce or test the current optimism.
Global equity momentum: AI optimism and trade headlines lift indexes
Tech gains and broad advances push benchmarks to new highs
World shares moved higher on the back of renewed optimism over US-China trade talks and continued investor enthusiasm for tech. Japan’s Nikkei passed 50,000, and major markets in Brazil, Europe and the United States also recorded gains. China saw a 10-year high in its equity measures, contributing to the global advance. Key individual movers included Qualcomm NASDAQ:QCOM, which jumped about 11 percent, Super Micro Computer NASDAQ:SMCI up roughly 7 percent, Tesla NASDAQ:TSLA rising 4 percent and Nvidia NASDAQ:NVDA up about 3 percent. The technology sector advanced around 2 percent while consumer discretionary lagged slightly.
Bond market signals were mixed. US yields rose two basis points and auction demand showed pockets of strength. The two-year Treasury auction drew the largest share of direct bids since 2012, and the five-year sale was described as going well. Volatility measures have compressed, with the MOVE index closing at a four-year low under 69.00 on Friday, a sign that bond traders are pricing in calmer near-term conditions.
Argentina’s relief rally: markets surge after Milei’s mid-term win
Peso, bonds and stocks spike on electoral clarity and external support
Argentina produced one of the most dramatic local market moves. President Javier Milei’s ruling party achieved a convincing victory in mid-term elections and local assets rallied sharply. The peso initially leapt more than 10 percent before settling up roughly 4 percent for the session. Local bonds rallied about 15 percent and equities surged near 20 percent. The scale of the move reflects both political clarity and recent financial support from Washington, which has been a significant factor in market sentiment.
In the short term, the result eased an immediate tail risk for investors with Argentine exposure and triggered a broad re-rating of local assets. Over time, market participants will watch whether reforms and external assistance create a more stable funding and policy environment. The question is whether the relief rally converts into durable credit market improvements or whether volatility will return once initial euphoria fades.
Central bank week: the Fed takes center stage
Major meetings set to reinforce the dovish tone that has propped up equities
Investors head into a busy central bank week with the Federal Reserve expected to cut rates by 25 basis points on Wednesday. The Bank of Canada, Bank of Japan and European Central Bank also meet, though the Fed is the only one widely expected to move this week. Markets have largely priced in a Fed cut, which helps explain part of the risk-on stance. Commentaries suggest the overall tone from these meetings will likely lean dovish, supporting equity gains that have been in place since April and bolstered by enthusiasm for AI.
While central bank communications will be scrutinized for guidance on the timing and magnitude of future easing, investors are also balancing the potential for policy to remain accommodative against economic data that could complicate the path forward. The combination of expected easing and strong earnings or data surprises could keep risk appetite elevated. Conversely, any hawkish signals or stronger than expected macro prints could temper sentiment quickly.
Commodities, FX and near-term market movers to watch
Metals, oil, auctions and key data could sway flows in the next session
Commodities reflected the risk-on mood but also the supply decisions shaping commodity markets. Gold fell about 3 percent and slipped back below $4,000 per ounce, while silver dropped roughly 4 percent. Oil eased as OPEC plans another output increase, pressuring crude prices despite the broad equity advance. In FX markets, the US dollar index slipped slightly and the Australian dollar was the largest G10 mover, up around 0.6 percent.
Market participants should also watch a string of events that could move sentiment tomorrow. Economic releases include South Korea GDP for the quarter and advance German consumer confidence for November. US data to monitor includes consumer confidence for October. Treasury supply is also significant with $44 billion of seven-year notes on offer, and recent auction dynamics have shown appetite variations. On the corporate side, earnings come from high-profile names that can change sector tone. Reports to watch include Amazon NASDAQ:AMZN, Visa NYSE:V, Sysco NYSE:SYY, UPS NYSE:UPS and UnitedHealth NYSE:UNH, among others. These reports will feed into the broader narrative about earnings momentum and how much of current market strength rests on fundamentals versus sentiment.
The headlines this morning delivered a blend of political clarity and diplomatic progress that encouraged investors to increase risk exposure. However, the situation contains elements of déjà vu on US-China trade negotiations and questions about the durability of Argentina’s rally. Short-term flows are favoring risk assets, but the upcoming central bank decisions, data releases and corporate results will provide a much clearer view of whether this environment can be sustained into the coming weeks. For now, markets are pricing in more time for risk assets to breathe and for policy makers to keep conditions supportive.
