Has a new Fed chair been chosen?

Key data to move markets today

EU: Spanish and Italian HCOB Services PMI, French and German HCOB Composite and Services PMIs, Eurozone HCOB Composite and Services PMIs, Eurozone PPI, and speeches by ECB Chief Economist Philip Lane and President Christine Lagarde
UK: S&P Global Composite and Services PMIs and a speech by Bank of England External Member Catherine Mann
USA: ADP Employment Survey, S&P Global Composite and Services PMIs, ISM Service Employment Index, ISM Services New Orders Index, ISM Services PMI, and ISM Services Prices Paid
CHINA: Rating Dog Services PMI 

US Stock Indices

Dow Jones Industrial Average +0.39%
Nasdaq 100 +0.84%
S&P 500 +0.25, with 8 of the 11 sectors of the S&P 500 down

US equity indices were up on Tuesday as traders await economic data releases later this week including the ADP Employment Survey today, Initial jobless claims numbers on Thursday and the Core PCE Deflator, the Fed’s favoured inflation gauge, on Friday. The Nasdaq composite rose 137.75 points, or +0.40%, to 23,413.67. The Dow Industrials was +0.39%, or 185.13 points, to 47,474.46, while the S&P 500 advanced 16.05 points or +0.25% to 6,828.68. 

In corporate news, Cloudflare shares were up after Barclays launched coverage on the infrastructure software company with an overweight rating and a $235 price target.

According to a Reuters report citing five Iraqi official sources, Exxon Mobil has approached the Iraqi oil ministry to express its interest in buying Russian firm Lukoil's majority stake in the giant West Qurna 2 oilfield. Exxon had been the operator of the neighbouring West Qurna 1 project before exiting last year. In October, Exxon signed a non-binding agreement with Iraq to help it develop its giant Majnoon oilfield and expand oil exports, marking the US major's return to the country.

Boeing’s CFO Jay Malave told a UBS conference that he expects the company to generate positive cash flow in 2026 after an expected negative $2 billion cash outflow this year. It would be the first time the company has generated positive cash flow since 2023, according to LSEG data, and would be a significant reversal in the planemaker’s finances as it prepares to boost monthly production rates of its passenger aircraft.

According to Bloomberg news, Novo Nordisk is planning a large study of its next-generation obesity shot CagriSema in children, a sign the drugmaker is pressing forward with the compound despite disappointing results in other trials.

Procter & Gamble’s shares hit their lowest point in two years after its finance chief issued a warning about the health of the American economy.

S&P 500 Best performing sector

Industrials +0.87%, with Boeing +10.15%, Generac Holdings +4.08%, and JB Hunt Transport Services +3.34 %

S&P 500 Worst performing sector

Energy -1.28%, with Expand Energy -3.17%, EQT -3.17%, and Targa Resources -2.76%

Mega Caps

Alphabet +0.29%, Amazon +0.23%, Apple +1.09 %, Meta Platforms +0.97%, Microsoft +0.67 %, Nvidia +0.86%, and Tesla -0.21%

Information Technology

Best performer: Intel +8.65%
Worst performer: Sandisk -2.29%

Materials and Mining

Best performer: Linde +0.41%
Worst performer: Packaging Corporation of America -5.26%

European Stock Indices

CAC 40 -0.28%
DAX +0.51%
FTSE 100 -0.01%

According to LSEG I/B/E/S data, third quarter earnings are expected to increase 7.2% from Q3 2024. Excluding the Energy sector, earnings are expected to increase 7.5%. Third quarter revenue is expected to decrease 1.1% from Q3 2024. Excluding the Energy sector, revenues are expected to increase 0.2%. Of the 280 companies in the STOXX 600 that have reported earnings to date for Q3 2025, 54.3% reported results exceeding analyst estimates. In a typical quarter 54% beat analyst EPS estimates. Of the 335 companies in the STOXX 600 that have reported revenue to date for Q3 2025, 47.8% reported revenue exceeding analyst estimates. In a typical quarter 58% beat analyst revenue estimates.

During the week of 8 December, five companies are expected to report quarterly earnings.

Commodities

Gold spot -0.558% to $4,204.85 an ounce
Silver spot +0.78% to $58.415 an ounce
West Texas Intermediate -1.15% to $58.64 a barrel
Brent crude -1.14% to $62.45 a barrel

Spot gold fell -0.558% to $4,204.85 an ounce on Tuesday as investors took profits following a six-week high in the previous session.

Silver was +0.78% to $58.415 per ounce. It has risen over 100% year-to-date.

Oil prices declined 1% on Tuesday as markets weighed faltering Russia-Ukraine peace hopes against fears of oversupply.

Brent crude futures settled 72 cents lower, or -1.14%, at $62.45 a barrel. WTI crude was down 68 cents, or -1.15%, to $58.64 a barrel. Both benchmarks advanced more than 1% Monday.

Note: As of 5 pm EST 2 December 2025

Currencies

EUR +0.12% to $1.1624
GBP -0.04% to $1.3211
Bitcoin +5.3% to $91,039.2
Ethereum +6.82 % to $2,980.9

The euro edged up after data showed eurozone inflation was slightly higher than expected, accelerating to 2.2% in November from October’s 2.1%. Core inflation, which excludes more volatile energy, food, alcohol and tobacco prices, was at 2.4% in November, unchanged from the previous month. The euro was +0.12% to $1.1624. This small rise is unlikely to concern the ECB as inflation is still close to the 2% target.

The British pound was relatively flat on the day, edging down -0.04%, to $1.3211 after having touched its highest level in a month on Monday. The pound is likely to remain range-bound as traders weigh the implications of cuts that are expected from the Federal Reserve and the Bank of England.

The dollar regained ground against the yen on Tuesday, recovering from Monday's selloff, even as expectations for a December rate hike by the Bank of Japan remained. 

The dollar was +0.24% higher against the yen at 155.845, after hitting a two-week low on Monday, following a sale of 10-year Japanese government bonds that drew the strongest demand since September.

Fixed Income

US 10-year Treasury -0.8 basis points to 4.086%
German 10-year bund +0.4 basis points to 2.753%
UK 10-year gilt -0.4 basis points to 4.477%

US Treasuries yields were flat to modestly lower Tuesday as markets awaited next week's Fed decision. A 25 bps rate cut is largely priced in and the focus is expected to be on any guidance about future policy moves.

During afternoon trading, the 10-year Treasury yield was -0.8 bps to 4.086%, after hitting a nearly two-week high earlier in the session.

The yield on the 30-year Treasury edged down -0.1 bps to 4.744%, while the two-year yield — sensitive to shifts in interest rate expectations — was -2.5 bps to 3.510%.

The Treasury yield curve steepened, with the spread between the two-year and 10-year yields at 57.6 bps, up from 54.2 bps on Monday. 

The curve showed a bull-steepening pattern, a scenario in which shorter-dated yields are falling much faster than those on long maturities. This reflects expectations that the Fed will be cutting rates.

According to CME Group's FedWatch Tool, Fed funds futures traders are pricing in a 89.2% probability of a 25 bps rate cut at December FOMC meeting, higher than the prior week’s 85.2% and the 63.0% probability assigned a month ago. Traders are currently expecting 21.8 bps of cuts by year-end. Market participants are awaiting Friday's release of the Personal Consumption Expenditures Index, the Fed's preferred inflation gauge, which may further solidify expectations for the Fed’s policy path. 

Despite inflation in the eurozone coming in at 2.2% in November, slightly up from October’s 2.1%, yields hardly moved. The yield on Germany’s 10-year bonds was +0.4 bps to 2.753%. On the long end, the German 30-year yield was +0.6 bps to 3.392%. The yield of Germany's two-year bond was +0.2 bps to 2.059%.

The yield spread between Italian and German bonds was 71.9 bps. The Italian 10-year bond was +0.8 bps to 3.472%.

The yield on the UK 10-year gilt was -0.4 bps to 4.477%.

Note: As of 4 pm EST 2 December 2025.

Global Macro Updates

Has Trump already chosen? President Donald Trump stated on Tuesday that he would be announcing his choice to succeed Jerome Powell as head of the Federal Reserve early next year. Jerome Powell’s term as Fed Chair expires in late May. During a televised cabinet meeting, Trump said his search for a Fed chair was “down to one”. About 10 candidates are thought to have been considered, but it appears that the President seems to be favouring Kevin Hassett, currently Chair of the National Economic Council, for the role. He has endorsed the President’s import tariffs and calls for lower interest rates. 

During the meeting President Trump also said Treasury Secretary Scott Bessent - who has led the search process - does not want the top Fed job. He consulted Bessent and Commerce Secretary Howard Lutnick for a new Fed chair. Although Polymarket has given Hassett a 7 in 10 chance of receiving the nomination to replace Jerome Powell, there may still be a surprise. Other supposed finalists have included Fed Governors Christopher Waller and Michelle Bowman, former Fed Governor Kevin Warsh and BlackRock’s Rick Rieder.

The administration had previously signalled the nomination could come before Christmas.

While every effort has been made to verify the accuracy of this information, EXT Ltd. (hereafter known as “EXANTE”) cannot accept any responsibility or liability for reliance by any person on this publication or any of the information, opinions, or conclusions contained in this publication. The findings and views expressed in this publication do not necessarily reflect the views of EXANTE. Any action taken upon the information contained in this publication is strictly at your own risk. EXANTE will not be liable for any loss or damage in connection with this publication.