Market Volatility Ahead of Fed Minutes: Technology Stocks in Decline

Current Status of Global Markets

Technology stocks on U.S. exchanges experienced significant fluctuations last week. On Friday, the Nasdaq 100 fell by 0.4%, facing selling pressure in technology-oriented stocks. One notable drop was observed in Palantir Technologies Inc.; the company’s shares declined by 7.5% due to allegations of flaws in their battlefield communication system. However, Palantir denied the allegations.

Performance of the S&P 500

Despite this, the S&P 500 index posted a small gain, maintaining the longest winning streak since July. The index has gone through 114 trading sessions in a row without a 5% decline. U.S. 10-year Treasury yields dropped by 6 basis points throughout the week, and the Bloomberg Dollar Index finished the week with a loss of 0.4%.

Rally in Asian Markets

Asian markets showed an increase this morning, led by Japan. The election of the ruling LDP leader Sanae Takaichi heightened expectations for fiscal stimulus, creating the perception that the BOJ would refrain from interest rate hikes. Following this development, Japanese stocks gained value, and the yield curve steepened.

Changes in Yen and Dollar Rates

The Yen fell to record low levels against the euro, while the dollar/yen exchange rate rose above 150. Long-term Japanese bonds continued to experience significant losses amid intervention concerns. The Nikkei 225 soared to a record high with a 3.7% increase, while the two-year bond yield declined to 0.9%. Investors have reduced expectations for BOJ interest rate hikes.

Developments in the Cryptocurrency Market

Bitcoin set a new record with strong support from U.S. stocks. Analysts predict that increased safe-haven searches in the markets following the possible U.S. government shutdown could impact Bitcoin.

Decisions of OPEC+ and Crude Oil Prices

OPEC+, with the agreement of leaders Saudi Arabia and Russia, decided on a modest increase in daily oil production in November. Despite this positive news, oil prices showed slight increases. Additionally, gold prices surpassed the $3,900 per ounce level, reaching a new peak.

Conclusion

Overall, markets are trying to find direction in preparation for the upcoming release of the Fed meeting minutes. The dollar/TL was trading at around 41.69 in the morning hours.