AI Search: Chip selloff eases, dollar idles as markets await US CPI
Top story
The global chip selloff eased, letting Asian shares edge higher and lifting sentiment across tech-heavy markets. The dollar languished and gold held firm, with attention fixed on the upcoming US CPI print and a heavy slate of Fed speakers. The tension underneath: a recovering tech narrative running alongside persistent policy uncertainty in multiple directions at once.
Asia Pacific
Chinese shares found support on strong September trade data showing double-digit export growth. Seoul shares rebounded on the tech recovery, though the policy backdrop turned more hawkish — the Bank of Korea signaled restrictive policy will persist, and the president said a near-term rate increase may be unavoidable, weighing on Korean equity exposure. Australian markets continued absorbing hawkish Reserve Bank minutes reiterating openness to further cash rate increases, leaving Australian equities lower. Singapore's central bank held policy steady while trimming its core inflation outlook, supporting Singaporean equities. Japan's corporate goods price growth cooled, but sharply elevated import prices kept the global policy picture ambiguous, with Japanese equities modestly higher. The IMF flagged sluggish Philippine growth and higher unemployment, with market reports reinforcing expectations for another rate hike, pressuring Philippine assets.
Europe
ASML lifted its fourth-quarter sales outlook and narrowed its 2026 revenue range on stronger-than-expected AI-driven demand, lending support to Dutch equities near record levels. The UK told a different story: a more cautious Bank of England rate outlook, paired with a lending survey showing tighter mortgage supply and weaker household demand, kept UK equities slightly lower. France remained the region's sore spot — the IMF sharply downgraded its growth outlook to just 0.4% for 2026, weighing on French equities and luxury exposure. Switzerland saw mixed signals: new mid-term targets from a major healthcare name supported the market, while lawmakers advanced a liquidity-backstop fee that would likely fall on a single large bank, alongside a tougher foreign-unit capital ring-fence backed by the upper chamber. Spain's headline inflation accelerated sharply to 4.9%, pressuring Spanish equities.
North America
US markets opened cautiously. Chip stocks extended their slide even as the broader global selloff eased, and big bank earnings told a mixed story — some lenders beat on profit while others missed on revenue, with several bank stocks sagging despite headline beats. Away from the banks, a data center chip boost lifted one major chipmaker, an analyst upgrade supported an energy major, and a healthcare company sank despite beating expectations. In Canada, shrinking September payrolls reinforced expectations the Bank of Canada will stay on hold.
Latin America
Brazilian equities slipped after a senator announced support for a constitutional amendment cutting the maximum workweek from 44 to 40 hours without permitting wage cuts — a labor-cost question now sitting squarely in front of the market. Argentina's September inflation confirmed a mild acceleration, pressuring Argentine exposure. The IMF projected Colombia's growth slowing through 2027, leaving Colombian equities lower.
Market reaction
- Equities: Asian shares edged higher; Dutch equities near record levels; UK, French, Spanish, Korean, Australian, Brazilian, and Argentine equities modestly to sharply lower; US markets opened cautiously.
- Dollar: languished.
- Gold: held firm ahead of US inflation data.
- Oil: choppy, as traders weighed the US-Russia diesel deal against Middle East supply risks following a strike near Saudi oil infrastructure that triggered a contained fire with no extraction disruptions.
- Treasuries: long-duration bonds found support as Japan's cooling producer price growth kept global policy paths ambiguous.
- Egypt and Israel stood out, with IMF upgrades — including recovering Suez Canal traffic showing a tenfold surge in large container transits — supporting both markets.
Policy / macro
Central banks dominated the tape. The Fed speaker slate and CPI print loom over the US session. The Bank of Korea's restrictive stance and the president's rate-hike comments kept Korean borrowing costs in focus. Hawkish RBA minutes signaled openness to further increases. The BoE's more cautious outlook contrasted with the RBA and BOK. The Bank of Canada looks set to stay on hold after weak payrolls. Singapore held steady with a trimmed inflation outlook. Russia said its diesel export deal with the US is not directly tied to Ukraine peace talks, with the policy continuing to support Russian diesel flows.
What this news leaves open
- Will the US CPI print and Fed speakers resolve or deepen the ambiguity in global policy paths?
- Can the chip recovery hold if US chip stocks continue sliding while Dutch equipment demand strengthens?
- How will Switzerland's capital-rule escalation and bank fee affect its largest lender's structure and competitiveness?
- Does Brazil's proposed workweek amendment advance, and what would it mean for corporate labor costs?
- Will Middle East supply risks or the US-Russia diesel deal set the direction for oil from here?
- Can France's growth trajectory stabilize after the IMF's sharp downgrade?
Sources
Ezbrisk weighs each event against the market reaction and publishes a verdict with an overreaction reading. How the methodology works