Global Markets Rally as Wall Street Enters Second Week of Q3 Earnings Season

Global markets opened the week strong, rising on Sunday night as investors moved into the second week of Q3 earnings season on Wall Street. Optimism was fueled by Donald Trump’s move to ease tariff pressures and improving investor sentiment.

Wall Street Rises Ahead of Earnings Reports Futures for major U.S. indexes edged higher:

🔹 Dow Jones Industrial Average +0.2% (+84 points)

🔹 S&P 500 +0.2%

🔹 Nasdaq 100 +0.3% According to CNBC, traders are closely watching upcoming inflation data and key earnings reports.

President Donald Trump helped calm markets after reports confirmed that he removed dozens of products from his reciprocal tariffs and is considering lifting duties on hundreds more. “A 100% tariff on Chinese goods wouldn’t be sustainable,” Trump told reporters last week. Within the administration, there’s growing agreement that items not produced in the U.S. should face lower import costs — a remark that eased tensions and helped restore confidence after last week’s sell-off triggered by new tariff threats.

Europe Follows Wall Street Higher – Banks Lead the Rebound European markets joined the rally on Monday morning after a volatile week driven by U.S. banking concerns.

The pan-European Stoxx 600 index climbed 0.8%, reversing Friday’s 0.95% decline.

Key markets:

🔹 FTSE 100 (UK) +0.5%

🔹 DAX (Germany) +1.1%

🔹 CAC 40 (France) +0.7%

🔹 FTSE MIB (Italy) +1.43% Bank stocks led the recovery, with Banco Sabadell rising 4.4% and BPER Banca up 4%. The rebound helped stabilize global sentiment ahead of a week full of key economic data. “Europe is catching its breath again. Positive signals from the U.S. and solid banking results are restoring risk appetite,” said Matthew Hornbach, head of rate strategy at Morgan Stanley.

Bond Yields Fall Below 4% as Investors Seek Safety Demand for safe-haven assets pushed U.S. Treasury yields lower.

The 2-year Treasury yield fell below 3.4%, its lowest level since 2022, while the 10-year yield briefly touched 3.93% before rebounding to 4%. It’s only the third time since April the benchmark yield has dropped below 4%. The move reflects a mix of uncertainty, weak job data, and high equity valuations. The Bloomberg Treasury Index is up 6.6% year-to-date, marking its best performance since 2020.

Hornbach noted: “Investors should say goodbye to 10-year yields above 4%. A prolonged government shutdown could extend the bond rally.”

Gold and Silver Rebound as Rate Cut Bets Strengthen Commodity markets remained active as traders weighed demand for precious metals against shifting rate expectations. Spot gold rose 0.3% to $4,259 per ounce, while December futures gained 1.4% to $4,273.

Despite a sharp 1.8% drop on Friday, gold is still up over 60% year-to-date, recently hitting an all-time high of $4,378. Silver climbed 0.6% to $52.18 per ounce, platinum advanced 2%, and palladium slipped 0.2%. Analysts attribute the rally to central bank purchases, strong ETF inflows, geopolitical tensions, and global dedollarization. Meanwhile, the U.S. Dollar Index (DXY) traded around 98.4, helping gold and silver regain ground.

Markets Bet on Fed Rate Cuts Investors remain confident that the Federal Reserve will cut interest rates at its October 29 meeting, with another reduction likely in December, according to CME’s FedWatch data. Friday’s inflation report is expected to show core CPI holding steady at 3.1%, which is unlikely to alter the Fed’s dovish tone. “The Fed is clearly signaling its intent to support growth and ease credit market pressure,” said a CME strategist.

Outlook: Optimism Returns — But Fragile Global markets are off to a strong start this week, but analysts caution that optimism remains fragile.

Any renewed tariff tensions, weaker earnings, or surprise inflation data could quickly reverse the trend. For now, investors are encouraged by signs that the trade war rhetoric is softening — and that Trump’s shift in tone could open the door to a new phase of market recovery.

#TRUMP , #WallStreet , #stockmarket , #GlobalMarkets , #Tariffs

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