US markets soared on Wednesday, with the Dow Jones Industrial Average closing above 45,000 for the first time, while the S&P 500 and Nasdaq Composite reached record highs. A robust rally in tech shares, driven by strong earnings reports from Salesforce and Marvell Technology, powered the gains, underscoring renewed investor confidence. The upbeat market performance came despite mixed economic data, with private payrolls falling short of expectations and investors eagerly awaiting Friday’s key labour market report.

Key Takeaways:

  • Dow Posts First Close Above 45,000: The Dow Jones Industrial Average surged 308 points, or 0.7%, to close at 45,000.85, achieving a historic milestone. Strong earnings from Salesforce, which jumped 9%, and Marvell Technology, which soared 24% after exceeding earnings expectations and issuing robust guidance. 
  • S&P 500 and Nasdaq Hit Record Highs: The S&P 500 climbed 0.6% to a record 5,602.24, lifted by strong performances across key sectors. The Nasdaq Composite advanced 1.3% to close at an all-time high of 18,372.15, with gains driven by solid earnings from companies like Marvell Technology and Salesforce. 
  • Private Payrolls Disappoint Ahead of Key Jobs Report: ADP data revealed that private payrolls grew by only 146,000 in November, significantly below the 163,000 expected and marking a decline from October’s upwardly revised 184,000. Job creation was led by education and health services (+50,000) and construction (+30,000), while manufacturing lost 26,000 jobs. Smaller businesses, with fewer than 50 employees, reported a loss of 17,000 jobs. Investors are now focused on Friday’s nonfarm payrolls report, which is projected to show 214,000 new jobs in November, potentially shedding light on the Federal Reserve’s next policy moves.
  • European Markets Rise Amid Political and Economic Uncertainty: European stocks ended broadly higher, with the pan-European Stoxx 600 up 0.38%. Germany’s DAX gained 215 points (+1.08%) to close at 20,085.5, driven by strength in industrials. France’s CAC 40 climbed 0.66%, even as the French government faced a vote of no confidence, plunging the eurozone’s second-largest economy into political uncertainty. Italy’s FTSE MIB rose 0.75%, while the UK’s FTSE 100 lagged, dropping 0.28% to 8,335.81 as weak UK Services PMI data of 50.8 pointed to slowing economic growth. In the eurozone, the HCOB composite PMI for November came in at 48.3, slightly above forecasts of 48.1, yet still indicating contraction. 
  • Asian Markets Mixed Amid Global Uncertainty: Asian markets reflected a cautious tone on Wednesday. Japan’s Nikkei 225 ended nearly flat at 39,276.39, while the Topix fell 0.47% to 2,740.6, as investors digested weak global cues. In China, the CSI 300 dropped 0.54% to 3,930.56, while Hong Kong’s Hang Seng Index declined 0.1% to 19,730 amid subdued market sentiment. Australia’s S&P/ASX 200 fell 0.38% to 8,462.6, as third-quarter GDP data showed slower-than-expected growth, weighed down by high borrowing costs and persistent inflation. South Korea’s Kospi tumbled 1.44% to 2,464.00, and the Kosdaq dropped 1.98% to 677.15 as political instability surrounding President Yoon Suk Yeol’s brief martial law decree and its subsequent reversal rattled markets. The Bank of Korea announced measures to stabilise liquidity and foreign exchange markets, including deploying a 10 trillion won stabilisation fund if needed.
  • 10-Year Treasury Yields Fall as Data Reflects Slowing Economy: The yield on the 10-year Treasury fell 4 basis points to 4.18%, while the 2-year yield dipped 5 basis points to 4.124%, reflecting market reactions to weaker-than-expected data. The ADP report showing slower private payroll growth and a deceleration in ISM Services PMI to 52.1 from 56 in October contributed to investor caution. Market participants are now closely watching Friday’s jobs report for further indications of the economy’s trajectory and the Federal Reserve’s policy outlook.
  • Oil Prices Dip as OPEC+ Decision Looms: Brent crude declined $1.05 (-1.43%) to $72.57 per barrel, while West Texas Intermediate dropped $1.08 (-1.6%) to $68.84 per barrel. Market focus shifted to the upcoming OPEC+ meeting, where an extension of production cuts is expected. Despite the dip, a larger-than-expected draw in US crude stockpiles earlier in the week provided some support to prices.

FX Today:

  • EUR/USD Holds Near Key Support as Eurozone Data Offers Mixed Signals: EUR/USD traded near 1.0514 on Wednesday, struggling to recover from recent declines amid a contraction in Eurozone business activity. The HCOB composite PMI came in at 48.3 for November, slightly above forecasts of 48.1 but still signalling contraction, keeping the pair under pressure. Immediate support lies near the 50-period SMA at 1.0511, with further downside targets at 1.0500 and the psychological level of 1.0450. Resistance is positioned at 1.0550, with any move above this level potentially opening a path toward 1.0600. The broader trend remains bearish unless the pair decisively clears its resistance levels.
  • GBP/USD Weakens Amid Poor UK Services Data: GBP/USD hovered near 1.2703, weighed down by a disappointing UK Services PMI reading of 50.8 for November, the lowest since October 2023. The pair struggled to reclaim key resistance at 1.2800, which aligns with the 50- and 100-period SMAs, underscoring ongoing bearish momentum. Support lies at 1.2650, with a break below this level exposing the pair to further downside toward 1.2550. On the upside, a sustained move above 1.2800 could signal a potential recovery toward 1.2900.
  • AUD/USD Slides as Economic Concerns Persist: AUD/USD remained under pressure, trading near 0.6439 following weaker-than-expected third-quarter GDP data in Australia. The report highlighted slowing growth due to high borrowing costs and sticky inflation, weighing on the Australian dollar. The pair faces immediate resistance at 0.6485, with the 50-period SMA acting as a ceiling. A break below 0.6400 could accelerate losses toward 0.6350. On the upside, a recovery above 0.6500 is necessary to alter the bearish outlook and signal potential stabilisation.
  • Gold Steady Amid Key Resistance Levels: Gold (XAU/USD) remained stable near $2,650 on Wednesday, consolidating after a recent rebound from $2,560. The metal faced resistance near $2,678, the 50-period SMA, which aligns with its broader upward trend since mid-year. Support was positioned at $2,646, boosted by the 200-period SMA, providing a cushion against downside risks. A break above $2,678 could drive gold toward $2,750, reaffirming the continuation of its uptrend. However, failure to hold above current levels could see prices retest support at $2,600, keeping the metal in a consolidation phase until a decisive breakout occurs.

Market Movers:

  • Marvell Technology Soars on Strong Guidance: Marvell Technology (MRVL) surged 24% on Wednesday after reporting third-quarter adjusted EPS of $0.43, beating the consensus estimate of $0.41. The company also issued robust fourth-quarter guidance, forecasting adjusted EPS in the range of $0.54-$0.64, above the market’s expectation of $0.52. 
  • Salesforce Rallies on Solid Earnings: Salesforce (CRM) gained 9% after posting fiscal third-quarter revenue of $9.44 billion, exceeding consensus estimates of $9.35 billion. The company also raised its fiscal 2025 revenue forecast to a range of $37.8 billion-$38.0 billion, with the midpoint surpassing market expectations of $37.86 billion. 
  • Pure Storage Jumps on Upbeat Revenue Forecast: Pure Storage (PSTG) climbed 21% after reporting third-quarter revenue of $831.1 million, beating analysts’ estimates of $814.8 million. The company raised its fiscal 2025 revenue forecast to $3.15 billion, up from its previous estimate of $3.10 billion, with the new midpoint exceeding the consensus of $3.13 billion. 
  • Roku Rises on Takeover Speculation: Roku (ROKU) advanced 9% after Needham & Co. highlighted the company as a potential takeover target. The speculative buying lifted the stock despite broader challenges in the media and streaming sectors.
  • Foot Locker Slumps on Lowered Guidance: Foot Locker (FL) tumbled 8% after reporting third-quarter adjusted EPS of $0.33, missing the consensus estimate of $0.41. The company also slashed its full-year adjusted EPS forecast to a range of $1.20-$1.30, down from the previous guidance of $1.50-$1.70, signalling ongoing challenges in the retail sector.
  • Energy Stocks Decline as Oil Prices Fall: Devon Energy (DVN), Halliburton (HAL), and Marathon Petroleum (MPC) dropped more than 3% as oil prices fell sharply. Brent crude slipped $1.05 (-1.43%) to $72.57 per barrel, while WTI crude dropped $1.08 (-1.6%) to $68.84 per barrel. Exxon Mobil (XOM), Occidental Petroleum (OXY), and Diamondback Energy (FANG) also posted losses of over 2% as traders awaited the outcome of Thursday’s OPEC+ meeting.

As markets closed on a high note, the Dow Jones Industrial Average crossed the historic 45,000 mark, gaining 308 points, while the S&P 500 and Nasdaq Composite reached record highs, fuelled by robust earnings from Salesforce and Marvell Technology. Mixed signals from economic data, including weaker-than-expected private payrolls growth and falling Treasury yields, added a cautious tone ahead of Friday’s key labour market report. European and Asian markets showed varied performances, with political turmoil in South Korea and slowing economic momentum in the eurozone contributing to regional uncertainty. Meanwhile, energy stocks declined as oil prices dipped, and gold consolidated near $2,650, reflecting ongoing market volatility. Investors now turn their focus to the Federal Reserve’s next steps and the impact of upcoming economic data on global markets.