Stock Market Update

The S&P 500 futures currently trade two points below fair value.

Equity indices in the Asia-Pacific region were mostly lower Tuesday, registering modest losses on a lack of buyer conviction ahead of Wednesday's closely watched FOMC decision. The Reserve Bank of Australia kicked things off Tuesday, voting unanimously to leave its cash rate unchanged at 3.60%, as expected; however, it was a more hawkish-minded decision, as RBA Governor Bullock reportedly said in the Q&A that rate hikes would need to be considered if inflation remains persistent. Japan had a JGB 5-yr auction that was met with okay demand. Finance Minister Katayama conveyed an intervention-minded tone, saying the action in the bond market is being closely monitored and that FX moves are concerning. The Bank of Korea, aiming to stabilize rising rates, is making its first bond purchase since 2022. Separately, China's President Xi talked up the idea of reinforcing growth momentum, while President Trump said he is going to allow NVIDIA to ship its H200 chips to approved customers in China, with 25% of any sales going to the U.S.

• In economic data:
  • Japan's M2 Money Stock 1.8% yr/yr (expected 1.4%; prior 1.6%); November Preliminary Machine Tool Orders 14.2% (prior 16.8%)
  • Australia's November NAB Business Confidence 1 (prior 6); October Building Approvals -6.4% m/m (expected -6.4%; prior 12.0%)

---Equity Markets---

• Japan's Nikkei: +0.1%
• Hong Kong's Hang Seng: -1.3%
• China's Shanghai Composite: -0.4%
• India's Sensex: -0.5%
• South Korea's Kospi: -0.3%
• Australia's All Ordinaries: -0.4%

Major European indices are mixed, with buyers and sellers lacking conviction ahead of key central bank decisions this week and next. The FOMC is expected to announce a "hawkish cut" on Wednesday. The BOE and ECB have policy meetings next week. France has a key vote today on its social security budget; the UK registered some relatively weak retail sales heading into the holiday season; and ThyssenKrupp is down over 7% after its FY26 adjusted EBIT guidance failed to live up to stronger expectations.

• In economic data:
  • Germany's October Exports 0.1% m/m (expected -0.2%; prior 1.5%) and Imports -1.2% m/m (expected 0.2%; prior 3.1%)
  • UK's November BRC Retail Sales Monitor 1.2% (expected 2.6%; prior 1.5%)

---Equity Markets---

• STOXX Europe 600: -0.1%
• Germany's DAX: +0.3%
• UK's FTSE 100: flat
• France's CAC 40: -0.5%
• Italy's FTSE MIB: +0.3%
• Spain's IBEX 35: +0.1%