FISG Daily Market Wrap 9th November

Asian Markets Rebound as Geopolitical Risks and AI Uncertainty Persist

Asian equities recovered from their steepest selloff in more than 18 months, supported by renewed buying interest in technology shares and measures introduced by Taiwan's authorities to restore investor confidence. The MSCI Asia Pacific Index rose 1.9% after falling 3.9% on Friday. Taiwan's Taiex surged 4.9%, while Japan's Nikkei 225 gained 2.3%. US equity futures also advanced, with S&P 500 futures up 0.4% and Nasdaq 100 contracts gaining 0.1%. The rebound followed a volatile week in which concerns over tighter US AI regulation triggered heavy losses across regional technology stocks. Taiwan's Taiex ended a seven-session losing streak, while Taiwan Semiconductor Manufacturing and MediaTek both gained at least 4%. Chinese and Indian shares also attracted renewed demand as investors rotated away from markets more heavily exposed to AI-related valuations. Nvidia remained in focus after reports that its board was investigating whether CEO Jensen Huang had been targeted in a foreign espionage plot. The headlines initially pushed Nasdaq 100 futures lower before sentiment recovered. Separately, reports concerning Huang's personal life added to the scrutiny surrounding the chipmaker. Bond markets moved in the opposite direction as demand for safe-haven assets eased. US Treasuries fell for a second consecutive session, with the 10-year yield rising one basis point to 4.87%. The Treasury market has also attracted attention following the Democratic victory in the US midterm elections, with investors reassessing the potential implications for government borrowing and fiscal policy. Oil extended its largest weekly decline since April 2020 as traders weighed diplomatic efforts to end the US-Iran conflict against continued regional attacks. Iran's Foreign Ministry spokesperson Esmaeil Baghaei said the country's two-day proposal remains the most reasonable option on the table and confirmed that an International Atomic Energy Agency visit to Bushehr had taken place in recent days. He also stressed that pressure from Washington should not undermine Iran's bilateral relations with Iraq. Meanwhile, a fire at Russia's Kirishi refinery was reported to have been brought under control. The Persian Gulf remains a key focus for energy markets, as investors assess whether diplomatic initiatives can reduce the risk of further disruption to oil supplies. The recent decline in crude prices reflects hopes of de-escalation, although continued attacks leave the outlook uncertain. Elsewhere, the European Commission's Economy Commissioner Valdis Dombrovskis warned that the European economy faces significant uncertainty and downside risks. Japan confirmed that it intervened in currency markets three times over the summer to support the yen, including a coordinated operation with the United States. In Australia, central bank officials warned that growing AI-related investment could add to economic demand and complicate efforts to control inflation. New Zealand's dollar strengthened after the incumbent National Party emerged from the weekend election with a potential path back to government. The latest rebound offers some relief after a difficult week for global equities, but investor confidence remains fragile. Markets are balancing renewed demand for technology shares against regulatory uncertainty, geopolitical developments and changing expectations for global interest rates. Developments in the Persian Gulf and the sustainability of the AI investment cycle remain central to the outlook. FISG Daily Market Wrap provides a concise view of the forces moving global markets, helping investors stay informed and better prepared for what comes next. FISG — Interstellar Group