Closing Recap 

Wall Street kicked off the new week with a powerful rally, as a significant breakthrough in Washington to end the record-long government shutdown unleashed a wave of risk appetite. The tech-heavy Nasdaq led the charge, surging over 2.25% as investors piled back into the AI and mega-cap names that were sold off last week. The positive sentiment was broad-based, with advancers outpacing decliners by a 2:1 margin. The U.S. dollar was mixed, but the big story was in commodities, where gold skyrocketed over 2.7% to break decisively above the $4,100 level. Crude oil and cryptocurrencies also participated in the rally, with Bitcoin rebounding strongly as the “risk-on” mood took hold. 

Key Takeaways 

• Shutdown Deal Fuels Rally: A Senate vote to advance a bill to end the 41-day government shutdown was the primary catalyst for a broad-based rally in risk assets. A key Senate vote has cleared the path for the government to reopen, with a final House vote expected within 36 hours.
• Nasdaq Soars on Tech Rebound: The Nasdaq jumped over 2.25%, with the “Magnificent Seven” and other AI-related stocks leading the sharp recovery from last week’s losses. 
• Gold Skyrockets Past $4,100: The precious metal had its best day in weeks, surging $112 to settle at $4,122 an ounce as dip-buyers returned with force amid a more favorable risk environment. 
• Crypto Recovers with Risk Assets: The cryptocurrency is seeing a modest rebound, but sentiment remains extremely fragile after a brutal October and a recent flash crash that saw over $1.3 billion in liquidations. The shutdown news improved sentiment and alleviated near-term market stress. 
• Soft UK Jobs Data Boosts BoE Rate Cut Bets: The British pound came under pressure after a weak UK employment report saw the probability of a December rate cut from the Bank of England jump to over 80%. 
• Yen Weakens as Takaichi Pushes Dovish Agenda: The Japanese Yen is back under pressure, with USD/JPY pushing above 154.00, as new Prime Minister Takaichi continues to signal a pro-stimulus, dovish policy agenda and pressure the Bank of Japan to remain accommodative.
• Michael Burry Issues New AI Warning: Famed investor Michael Burry took to “X” to warn of potential accounting fraud among “hyperscalers” related to the depreciation of Nvidia chips, adding a note of caution to the AI euphoria. 
• Markets Brace for Data Deluge: With the government set to reopen, markets are now preparing for a flood of seven weeks’ worth of delayed economic data, which could introduce significant volatility in the days ahead.

Market Overview

The market’s resilience was on full display once again on Monday. After a sharp, multi-day pullback last week, Wall Street started the new week with a powerful rally. The trading week began with a powerful risk-on wave, driven by the long-awaited breakthrough to end the government shutdown. After 41 days, the Senate’s 60-40 vote to advance a funding bill was the green light investors had been waiting for, effectively stopping the economic bleeding and removing a major source of market uncertainty. The reaction was immediate and decisive. The tech and AI stocks that had been under pressure from valuation concerns last week led the charge, with the Nasdaq posting its 10th consecutive positive Monday. 

Index	Up/Down	%	Last
DJ Industrials	381.44	0.0081	47368
S&P 500	103.67	0.0154	6832
Nasdaq	522.64	0.0227	23527
Russell 2000	22.82	0.0094	2455

The improved sentiment was not just about the shutdown; dovish weekend comments from Fed Governor Miran calling for a 50 bps cut in December also helped fuel the rally. However, a significant undercurrent of caution remains. Famed “Big Short” investor Michael Burry issued a detailed warning about what he sees as potential accounting irregularities among major tech companies, alleging they are understating depreciation on their massive AI infrastructure investments to artificially boost earnings. 

This, combined with data showing U.S. credit card delinquencies at their highest level since 2011, serves as a stark reminder of the risks lurking beneath the surface of the headline rally. With the government reopening, the market will soon be hit with a torrent of delayed economic data, which will provide the first clear look at the economy’s health in nearly two months and could dramatically reshape the narrative.

Economic Calendar 

With U.S. bond markets closed for the Veterans Day holiday, today’s session is light on U.S. data. The main event was the UK employment report, which has significant implications for the Bank of England’s next move. Data Released Earlier / Overnight: 

• UK Employment Report (Sep/Oct): A soft report across the board. The ILO unemployment rate rose to 5.0% (vs. 4.9% exp), employment change fell by -22k (vs. 0k exp), and October payrolls dropped by -32k. The data sent the probability of a December BoE rate cut soaring to over 80%. 
• Australian Consumer Confidence (Nov): The Westpac survey jumped a massive 12.8% to 103.8, the first move into net optimism in nearly four years. 

Today’s Economic Calendar: 

• European Session: German ZEW Economic Sentiment survey, though it is unlikely to be a major market mover. 
• U.S. Session: An extremely light calendar with only low-tier Redbook and NFIB data. 
• The U.S. stock market is open, but the bond market is closed for Veterans Day. 

Asset Class Spotlight: FX, Commodities, Bonds & Crypto

It was a banner day for precious metals. Gold prices soared an incredible $112, or 2.72%, to settle at $4,122 an ounce, as the improved risk sentiment and renewed Fed rate cut speculation emboldened dip-buyers. Silver also jumped 4.5% to its highest level in weeks. Crude oil prices bounced off their morning lows, with WTI settling up 0.64% at $60.13 a barrel, supported by the broad risk-on mood. 

Asset	Up/Down	Unit / % Change	Last
WTI Crude	0.38	0.0064	60.13
Gold	112.2	0.0272	4122
EUR/USD	-0.0004	-0.0003	1.1561
USD/JPY	0.59	0.0038	153.99
Bitcoin	2,000+	1.9%+	105,000+
10-Year Note Yield	0.015	0.0037	0.04108

The currency market saw the British pound come under pressure following weak data, while the Japanese yen continued to be weighed down by domestic policy signals. 

• GBP/USD: The Pound is the biggest loser in the G10 space. The pound slumped following the soft UK jobs report, with GBP/USD falling sharply to 1.3120 as the unemployment rate hit a four-year high. The data has strongly tilted the scales in favor of a December rate cut from the Bank of England, creating a significant headwind for the currency. The market is now pricing in an 81% chance of a December rate cut from the Bank of England, a significant headwind for Sterling. A large $1.6B options expiry at the 1.3100 level looms as a major target for bears.
• EUR/USD: The euro edged lower around 1.1560 as the dollar gained on shutdown resolution hopes. The pair remains in a consolidative phase after last week’s declines, with the market awaiting fresh catalysts from either the ECB or the upcoming deluge of U.S. data. 
• USD/JPY: The pair climbed towards 154.40, its highest since February. The yen is underperforming as Japan’s Economy Minister offered only feeble verbal intervention against yen weakness, reinforcing the market’s view that policymakers are comfortable with the current dovish policy stance. 

Cryptocurrencies: The crypto market participated in the relief rally. Bitcoin recovered strongly along with other risk assets, trading above the $105,000 level as bargain hunters stepped in after the recent sharp sell-off. Traders are now looking ahead to December, which has historically been a strong month for Bitcoin, in hopes of a “Santa Claus Rally.” Treasuries: U.S. Treasury yields were little changed, with the 10-year yield holding around 4.11%. The U.S. bond market is closed today for the Veterans Day holiday, limiting any significant moves. A strong 3-year note auction on Monday failed to move markets. 

Looking Ahead 

The market’s immediate focus will be on the final passage of the government funding bill through the House, which now appears to be a formality. Once the government officially reopens, the main event will be the release of a backlog of critical economic data. The September jobs report is expected within days, but October’s inflation and employment figures could take weeks, potentially leaving the Fed with an incomplete picture ahead of its crucial December 10th meeting. In the meantime, traders will be watching a slate of AI-related earnings this week for clues on whether the tech rally has further to run.

What to Watch

• The Shutdown Endgame: The main driver of this week’s optimism is the prospect of the government reopening. Traders will be watching for the final House vote, which is expected within 36 hours. A successful resolution will allow for the release of six weeks of backlogged economic data. 
• The BoE’s Dovish Shift: The soft UK jobs report has tipped the scales firmly in favor of a December rate cut from the Bank of England. This is a major new narrative for the Pound, and traders will be watching to see if the sell-off in GBP/USD accelerates. 
• “Abenomics 2.0” and the Yen: The political landscape in Japan is now a primary driver for the Yen. PM Takaichi’s clear dovish stance is a powerful headwind for the currency. The market will be watching to see if this narrative can push USD/JPY to new multi-year highs. 
• Burry’s AI Warning: Michael Burry’s detailed thesis on potential accounting fraud related to AI chip depreciation is a significant new risk for the tech sector. While the market is currently ignoring it, this is a story that could gain traction, especially if upcoming earnings from Nvidia show any signs of weakness.