Trump optimistic on trade; US stock futures rebound; key earnings week ahead.

"TACO" is Here? Trump Signals Trade Relations Will "Eventually Improve"

Following President Trump's statement that trade relations will "eventually improve," U.S. stock index futures rose on Monday, rebounding from Friday's sell-off. Trump hinted on his social media platform that he might not follow through on previous threats regarding tariffs, which had caused a significant market downturn. He reassured investors, stating, "No need to worry, everything will eventually improve!"

Market Reactions

• Vice President Vance echoed Trump's sentiment over the weekend, and U.S. Trade Representative Tai expressed expectations for market stabilization in the coming week.

• These comments may encourage investors to return to the market after the recent sell-off.

China's Response to Tariffs

The Chinese Ministry of Commerce stated that its export controls on rare earths are not a ban but a legal measure. The spokesperson emphasized that using high tariffs as threats is not the right approach to engage with China. China remains open to dialogue to resolve concerns and maintain stable trade relations.

Pentagon Expands Strategic Reserves

The Pentagon is accelerating its efforts to expand the national strategic reserves, with a $1 billion plan led by the Defense Logistics Agency. This initiative aims to secure new sources of minerals to meet defense product demands.

• U.S. rare earth producers like USA Rare Earth (USAR) have seen stock prices rise over 180% this year, while MP Materials (MP) surged over 400%.

U.S. Government Shutdown and Military Pay

Trump has ordered the Defense Secretary to use available funds to ensure military salaries are paid during the government shutdown. However, this has raised concerns among Republican leaders about potential impacts on other defense projects.

Silver Market Liquidity Crisis

In London, silver prices have reached unprecedented premiums compared to New York futures, leading to a liquidity crisis. Traders holding short positions are struggling to find deliverable metal, resulting in high costs to defer settlements.

Upcoming Earnings Reports

The new earnings season kicks off this week, with major banks like JPMorgan Chase (JPM), Goldman Sachs (GS), and Bank of America (BAC) expected to report strong third-quarter results due to a robust recovery in investment banking.

U.S. Stock Market Decline

The U.S. stock market experienced a significant drop on Friday, reminiscent of early April. The S&P 500 fell 2.71%, while the Nasdaq Composite dropped 3.56%, marking the largest single-day declines since April.

• Notable declines included Nvidia down 4.89% and Apple down 3.45%.

Tesla's Shareholder Meeting

Tesla (TSLA) announced a shareholder meeting on November 6 to vote on key proposals, including CEO Elon Musk's compensation plan.

SoftBank's $5 Billion Loan

SoftBank Group (SFTBY) is negotiating a $5 billion loan backed by its shares in Arm Holdings (ARM) to fund investments in OpenAI. This move is supported by Arm's strong market performance this year.

Warner Bros. Discovery Rejects Acquisition Offer

Warner Bros. Discovery (WBD) has rejected an acquisition proposal from Paramount Skydance (PSKY), citing the offer as too low.

Qualcomm Investigation

China's market regulator has launched an investigation into Qualcomm (QCOM) regarding its acquisition of Autotalks, which was completed without proper notification.

CoreWeave Executives Cash Out

Executives at CoreWeave (CRWV) have sold over $1 billion in stock since the end of the IPO lock-up period, reflecting the company's significant stock price increase.

Hong Kong Stock Market Movements

Recent trading saw significant net selling of Hong Kong stocks, with notable purchases in Xiaomi (01810.HK) and substantial sell-offs in SMIC (00981.HK).

Conclusion

As the market navigates through these developments, investors are closely watching the implications of trade relations, government actions, and upcoming earnings reports.