Morning Brew October 30 2026

Good morning. October is ending on a defensive note. Investors are shifting their focus from the scale of the AI build-out to the returns it can generate, with disappointing technology earnings spilling into Asian markets. Bonds, the yen and the Swiss franc are finding support, but precious metals and crypto are not sharing in the flight to safety.

Equities: AI returns come under scrutiny

United States — Thursday close: The Nasdaq 100 fell 1.4% to around 29,400, while the S&P 500 and Dow both slipped 0.3%, to roughly 7,720 and 52,340. Healthcare, real estate and consumer staples outperformed as investors moved towards defensive sectors.

Big Tech — overnight: Alphabet fell about 13% in regular trading and edged lower after hours, erasing around $500 billion in market value as heavy AI investment pushed cash flow negative. Intel then plunged roughly 23% after hours and Amazon fell about 7%. Nasdaq 100 futures were down around 1.9% in early Asian trading. These overnight moves are separate from Thursday’s cash-market closes.

Other US movers: Caterpillar dropped around 10%, while Ford gained about 12% after beating revenue expectations. Starbucks slipped roughly 2% after hours, with international weakness overshadowing stronger US comparable sales.

Europe — Thursday close: European shares held up better, supported by corporate earnings and reports of progress towards an Iran peace deal. The Stoxx 600 rose 0.8% to around 649, the DAX gained 1.3% to 26,040, the CAC 40 added 1.1% to 7,970 and the FTSE 100 rose 0.3% to around 10,720. Kongsberg jumped about 13%, Adidas gained roughly 6%, and Novartis and Sandoz rose around 2% and 4%. Haleon fell as much as 14% after cutting its sales-growth outlook following restrictions on Centrum vitamin sales in China.

Asia — Friday morning: Selling spread across technology and chip stocks. South Korea’s Kospi fell more than 3%, taking its October decline to nearly 16%, while Japan’s Nikkei lost over 2% and was heading for a monthly fall of about 5%. China’s CSI 300 was on course for its largest monthly decline in a decade. Asian trading snapshot

Macro and central banks: strong growth, unfinished inflation fight

United States: Thursday’s advance GDP estimate showed annualised third-quarter growth of 3.4%, up from 2.2% in the second quarter, supported by investment and consumer spending. September headline PCE inflation rose to 3.6% year on year and core inflation to 3.1%. Weekly jobless claims fell to 194,000, reinforcing the picture of low layoffs. The Fed held rates at 3.75%–4.00% on Wednesday, but these releases offer little basis for declaring victory over inflation. One important distinction: quarterly PCE inflation slowed even as September’s annual reading accelerated.

Japan: The Bank of Japan left rates unchanged on Friday and signalled that underlying inflation was broadly at its 2% target, keeping a December hike in view. Tokyo’s core inflation remained above target. The additional market-sensitive development was the BOJ’s plan to accelerate sales of its equity exchange-traded fund holdings next year, adding pressure to Nikkei futures.

Euro area: The ECB held rates on Thursday but kept a possible December increase in focus as energy costs threaten to feed into broader inflation. Christine Lagarde also announced that she will leave on 7 February 2027, ahead of her scheduled October departure, to speak more freely on issues beyond monetary policy. The succession process has begun; the announcement itself prompted little market reaction.

Trade: a constructive Swiss–China development

Switzerland and China are due to sign an upgraded free-trade agreement in Beijing today during Guy Parmelin’s meeting with Xi Jinping. The agreement aims to improve market access for Swiss goods and investment while strengthening environmental and labour standards—a constructive counterpoint to the wider shift towards protectionism. Signing should not be confused with immediate entry into force.

Bonds, currencies and commodities

Bonds: US Treasuries rallied as risk appetite weakened. The 10-year yield fell more than 7 basis points to around 4.9%, taking its October decline to roughly 37 basis points—the biggest monthly drop since December 2023. The two-year yield fell more than 8 basis points to about 4.6%, with markets trimming expectations for further Fed hikes.

FX: The yen and Swiss franc benefited from the defensive tone. USD/JPY was around 157.2, USD/CHF near 0.821 and EUR/USD around 1.119. These are indicative early-session readings, not live quotes

Oil: Prices rose on Friday and were heading for a fourth consecutive monthly gain. An attack on a tanker in the Strait of Hormuz underlined continuing supply risks from the Middle East conflict, even as diplomatic efforts remain a potential counterweight.

Gold: The metal remained under pressure and was heading for a second consecutive monthly decline. My focus is the $4,000 support area: dip-buying has helped before, but the month-end close will be an important test : Silver fell 1.6% to around $52 an ounce, platinum lost 1.9% to roughly $1,460 and palladium slipped 1.4% to about $992. All three were heading for weekly and monthly declines.

Binance became the victim of the biggest ever Crypto heist

Binance estimated the impact of its security breach at around $6.3 billion, potentially the largest crypto theft on record. Around $3 billion in affected assets has been frozen, and the exchange has pledged to cover losses. TRM Labs and Chainalysis linked the attack to a North Korean state-sponsored group. Crucially, frozen funds are not the same as recovered funds; returning assets may require legal proceedings and coordination with issuers and exchanges. Bitcoin hit a six-week low before recovering to around $78,200 in the early-session snapshot. My watchpoints are the restoration of normal withdrawals, the pace of asset recovery and whether exchange outflows remain orderly. The story is not just about crypto prices—it is also a test of custody, liquidity and confidence. 

What I am watching

Today: Whether the technology sell-off broadens beyond AI-related names, whether the Treasury rally holds, and whether gold can defend $4,000. Updates from Binance and developments around Middle East energy supplies could move sentiment quickly. 

Next week: The US midterm elections, labour-market releases and another round of major earnings will test both the growth outlook and confidence in the AI investment cycle. Efforts to resolve the Middle East conflict remain a key variable for oil and inflation. In Switzerland we are expecting Inflation update on Tuesday

• Friday, 30 October 2026
  Macro: Euro-area flash Q3 GDP and preliminary October inflation; U.S. Q3 Employment Cost Index; month-end flows.
  Central banks: Bank of Japan rate decision and Outlook Report.
  Corporate earnings: Sanofi, AstraZeneca and BP; ExxonMobil, Chevron and AbbVie.

  
  Monday, 2 November 2026
  Macro: China manufacturing PMI; Germany retail sales; U.S. ISM Manufacturing PMI.
  Corporate earnings: Apple, Palantir, Vertex Pharmaceuticals, Marriott and Estée Lauder.
  
  Tuesday, 3 November 2026
  Macro: Swiss CPI; New Zealand Q3 employment report, released late evening CET.
  Central banks: Reserve Bank of Australia rate decision, Statement on Monetary Policy and press conference.
  Politics: U.S. midterm elections.
  Corporate earnings: AMD, Amgen, Arista Networks, Pfizer and Eaton.
  
  Wednesday, 4 November 2026
  Macro: China services PMI; U.S. ADP employment report and ISM Services PMI.
  Corporate earnings: Novo Nordisk, Toyota, Qualcomm, Arm, McDonald’s and Uber.
  
  Thursday, 5 November 2026
  Macro: Australia trade balance; U.S. initial jobless claims.
  Central banks: Bank of England rate decision and Monetary Policy Report.
  Corporate earnings: Sony, ConocoPhillips, Cloudflare, Parker-Hannifin and Southern Company.
  
  Friday, 6 November 2026
  Macro: Euro-area retail sales; U.S. nonfarm payrolls, unemployment rate and average hourly earnings; Canada employment report; preliminary University of Michigan consumer sentiment.
  Corporate earnings: Moderna, Humana, Enbridge and Brookfield Asset Management.