Global financial markets saw sharp volatility on Thursday, with U.S. trading starting on a strong note as a higher Unemployment Rate, upbeat earnings from Nvidia and Walmart, and renewed optimism in the Artificial Intelligence (AI) sector lifted early sentiment. However, momentum reversed mid-day, sending risk assets into the red. The Nasdaq Composite Index swung dramatically from a 2.0% gain to more than a 2.0% loss, while mixed Federal Reserve (Fed) commentary and a second review of recent data reinforced expectations of no December rate cut, boosting the U.S. Dollar (USD) and weighing on the broader mood despite supportive geopolitical news.
U.S. data added to concerns about labor market softness. Nonfarm Payrolls (NFP) rose to +119K in September, versus +50K expected, recovering from a revised -4K prior reading. The Unemployment Rate reached 4.4%, the highest since November 2021, versus 4.3% expected, while Average Hourly Earnings held at 3.8% Year-over-Year but slowed to 0.2% for September. Initial Jobless Claims dropped to 220K from 228K, and the Philadelphia Fed Manufacturing Survey Index improved sharply to -1.0 from -12.8. These mixed signals increased uncertainty around December policy expectations and briefly softened the U.S. Dollar (USD), giving risk assets a modest lift, before the risk aversion amplified.
Fed officials maintained a cautious tone. Cleveland Fed President Beth Hammack said cutting rates risks prolonging inflation. Chicago Fed President Austan Goolsbee noted inflation has stalled at 3%, still above the 2% target. Fed Governor Lisa Cook said not all market volatility is harmful, while Philadelphia Fed President Anna Paulson stressed the need to balance weakening labor momentum with lingering inflation risks. As a result, market odds for a December rate cut fell below 40%, down from 80% earlier in the month.
Global political and trade headlines added further layers to market sentiment. U.S. Treasury Secretary Scott Bessent again called for more Fed rate cuts.
China’s Commerce Minister Wang told the U.S. ambassador that China raised concerns about tariffs, export controls, and investment restrictions.
Ukrainian President Volodymyr Zelenskyy said he agreed to work on a U.S. draft peace plan.
In a separate development, four people were charged with smuggling Nvidia AI chips to China using fake documents and third-country shipping, prompting renewed calls for a U.S. chip-tracking law.
Donald Trump expanded tariff exemptions for Brazilian food imports, eliminating a 40% levy on items such as coffee, orange juice, and beef, retroactive to November 13, to counter voter frustration with high grocery prices.
In Europe, Eurozone consumer confidence fell to -14.2 versus -14.0 expected, while EU Trade Commissioner Maroš Šefčovič said the bloc is exploring equity stakes, offtake deals, and joint investments in Australian resource projects, with fresh momentum in efforts to revive the Australia-EU–EU trade agreement early next year.
Japan introduced a significant new stimulus. Prime Minister Sanae Takaichi confirmed Japan may issue bonds if needed, but expects total Japanese Government Bond (JGB) issuance to remain below last year’s level. The Cabinet approved a 21.3 trillion-yen stimulus package, including 17.7 trillion yen in fresh spending and 11.7 trillion yen dedicated to price relief through subsidies and cash support, marking the largest supplemental spending since the pandemic.
Japan’s October exports rose 3.6% Year-over-Year, imports increased, and the trade deficit narrowed. The preliminary Japan Manufacturing Purchasing Managers’ Index (PMI) for November improved to 48.8 from 48.2 but remained in contraction, while the November Core Consumer Price Index (CPI) held at 3.0%, above the Bank of Japan’s (BoJ) 2% target.
Finance Minister Satsuki Katayama said Japan expects its debt-to-GDP ratio to edge lower despite the extra budget and reaffirmed that FX intervention remains an option under the Japan–U.S. agreement.
BoJ Governor Kazuo Ueda said the weak yen is raising import costs but that inflation should converge toward the target in the latter half of next fiscal year, with rate hikes to continue if conditions evolve as expected.
In the UK, consumer confidence fell to -19 from -17 ahead of the upcoming budget, matching the weakest reading since May and highlighting pressure on retailers.
Australia’s preliminary November PMIs showed Manufacturing at 51.6, Services at 52.7, and Composite at 52.6, though these had limited impact on AUD amid risk-off flows. Canada’s October Produce Price Index climbed 1.5% versus 0.3% expected.
The U.S. Dollar Index (DXY) closed Thursday near a two-week high after a five-day climb before retreating slightly on Friday. Stronger USD weighed on Gold and kept EURUSD on a five-day decline before a mild rebound. GBPUSD recovered from a two-week low but remains on course for its first weekly loss in three. USDJPY halted its five-day rally after slipping from a 10-month high. AUDUSD and NZDUSD remain near their lowest levels in three and seven months, respectively. USDCAD steadied at weekly highs, crude oil fell to a one-month low for a third straight session, and both Bitcoin (BTC) and Ethereum (ETH) declined to multi-month lows.
EURUSD stalled its five-day winning streak after rebounding from a two-week low, as mixed European data and a reassessment of Federal Reserve (Fed) expectations prompted Euro sellers to pause. Hopes for earlier Ukraine–Russia peace progress, supported by fresh comments from Ukrainian President Volodymyr Zelenskyy, also helped limit the pair’s downside, while a corrective pullback in the U.S. Dollar (USD) from a two-week high following a five-day rise added to the recovery.
GBPUSD extended its rebound from a two-week low, staying firm for a second day, even as weaker United Kingdom Consumer Confidence and caution ahead of the November 26 United Kingdom budget kept traders on guard.
USDJPY eased from a 10-month high, breaking its five-day uptrend as Japan’s stimulus package, repeated verbal intervention, and hawkish Bank of Japan (BoJ) signals supported the Japanese Yen. However, the pullback remains limited and could quickly reverse if upcoming U.S. data prints stronger than expected.
AUDUSD and NZDUSD both halted their two-day losing streaks but showed limited recovery momentum, weighed by mixed domestic data and worries that the U.S. Dollar (USD) could quickly reverse its latest pullback after today’s U.S. PMI figures. Meanwhile, USDCAD retreated from a two-week high and posted its first daily loss in three sessions, even as it ignored weaker crude oil prices—Canada’s key export—while traders awaited Canada’s retail sales and housing data.
WTI crude oil, Bitcoin, and Ethereum extended their declines for a third straight session as broad risk aversion and technical breakdowns deepened the pullback. Crude oil faced additional pressure from hopes of an earlier end to the Ukraine–Russia war, expectations of higher supply, and concerns about weakening oil demand.
Crypto markets remained under stress after Owen Gunden, one of the world’s largest individual Bitcoin holders, fully exited his position by selling around 11,000 Bitcoin worth roughly $1.3 billion between October 21 and November 20, including a final transfer of 2,499 Bitcoin to the Kraken exchange. His departure removes a major long-term holder and adds near-term supply pressure amid fading retail sentiment.
Even strong Artificial Intelligence (AI) catalysts could not stabilize equity markets. Nvidia posted exceptional results, and Google launched its highly anticipated Gemini 3 Artificial Intelligence model alongside a new image model, briefly lifting the sector. Walmart also maintained an upbeat outlook for holiday consumer spending, and higher unemployment typically raises expectations for future rate cuts. However, equities still sold off sharply, with Nvidia reversing a 6% gain into a 3% loss as the Nasdaq Composite Index turned deeply negative. Asian equities across the Asia-Pacific (APAC) region followed the global downturn despite Japan’s fresh stimulus efforts.
Gold has fallen in three of the past five sessions and continues to struggle to uphold its traditional safe-haven appeal as a stronger U.S. Dollar (USD) and renewed hawkish Federal Reserve (Fed) expectations weigh on sentiment. The metal also reflects bearish technical signals and a lack of supportive news from China, even though both China and Japan have announced stimulus measures to shore up their economies. Even so, a two-month support level is limiting further downside in XAUUSD and keeping buyers cautiously optimistic on both a monthly and yearly basis.
As markets look ahead, preliminary November Purchasing Managers’ Index (PMI) readings, mid-tier U.S. and Canadian data, and Federal Reserve (Fed) speeches will dominate the calendar.
Following Thursday’s sharp shift from optimism to risk-off sentiment, the U.S. Dollar (USD) is expected to remain firm amid a hawkish Federal Open Market Committee (FOMC) bias ahead of December. This environment could continue to weigh on risk assets like equities and cryptocurrencies, while Gold may struggle under the stronger Greenback, suggesting Wall Street could close the week under pressure.
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