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MARKET WRAPS

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Opening Call:

European stock futures traded higher early Thursday. Asian stock benchmarks were mixed; the dollar weakened and Treasury yields were down; oil futures fell and gold rose.

Equities:

Stock futures in Europe were tracking higher as markets parsed the results of the U.S. midterm elections.

"The Democratic sweep of both the House and Senate at the U.S. midterm election represents a meaningful shift in the political landscape and has triggered an unwind of part of the political and geopolitical risk premium embedded in markets," said Lloyd Chan, senior currency analyst at MUFG.

"We do not believe the outcome of the U.S. mid-term elections will prompt significant policy changes or lead to a major market reaction in the short to medium term," said Luca Paolini, Chief Strategist at Pictet Asset Management.

Focus today is on the Bank of England's policy meeting, which is widely expected to vote to lift its key bank rate to 4% from 3.75%.

Forex:

The U.S. dollar weakened. The dollar had already been falling in recent days as polls ahead of the elections had anticipated decent gains for the Democrats with the potential of a sweeping victory, although further losses could be limited.

"We do not expect the election result to mark a start of more persistent dollar weakness," Danske Bank analyst Kirstine Kundby-Nielsen said.

The outcome improves predictability in U.S. fiscal policy, lowers the risk of deficit-increasing policy changes over the next two years, and sets guardrails for Trump's political nominations which look positive for the dollar over the medium-term, Kundby-Nielsen said.

Bonds:

Treasury yields were lower following the Democratic Party's victory in the U.S. midterm elections.

Expect fiscal tightening in 2027 versus 2026 with little chance of new fiscal stimulus while capex depreciation, tariffs, and defense spending likely come under heightened scrutiny, said George Bory, Chief Investment Strategist for Fixed Income at Allspring Global Investments.

Higher taxes are unlikely in the near term, but the Democrats may start to lay the groundwork for 2028. "The deficit could shrink next year which would be good for bond investors."

Energy:

Oil prices continued to fall early Thursday after declining over 8% overnight on rising hopes for an end to the Middle East conflict.

"We feel that a huge amount of geopolitical risk premium has been extracted from the oil market in just three sessions," Ritterbusch & Associates said.

Still, ANZ analysts think the market reaction is unwarranted as there are risks of escalation in the conflict. "There appears no end in sight to Iran's control of the Strait of Hormuz, which has constrained oil flow." Exports of crude oil from the Persian Gulf averaged 17.1 million barrels a day in October, according to ship-tracking data, down from September, they said.

Metals:

Gold was higher. The U.S. midterm election results sent Treasury yields lower, boosting the appeal of the precious metal, ANZ research analysts said.

However, analysts note that investors expect a more constrained fiscal outlook under a Democratic win, which could erode support for gold in the long term.

Copper gained. There are competing forces influencing the market as investors digest the U.S. midterm election results and weigh them against the supportive long-term fundamentals of the base metal, said Ole Hansen, head of commodity strategy at Saxo.

The long-term outlook remains positive for copper prices, but the election outcome could trigger a prolonged period of consolidation as traders reassess tariff risks, inventory flows and the U.S. demand outlook, Hansen added.

TODAY'S TOP HEADLINES

The BOE Hasn't Hiked Rates Since the Iran War Started. Why That's About to Change.

The Iran war has become too big of a problem for monetary policymakers to ignore, and it looks like the Bank of England will be next to hike interest rates.

The BOE's monetary policy committee is widely expected to vote to lift its key bank rate to 4% from 3.75% on Thursday. That would mark the first time it has raised borrowing costs since August 2023.

The Election Day Revolt That Threatens America's AI Boom

The biggest names in America's artificial-intelligence boom gathered at the San Francisco Opera House on election night for a show hosted by Nvidia CEO Jensen Huang.

They were there to see "The Marriage of Figaro." But over wine and passed hors d'oeuvre, executives in tuxedos buzzed about an emerging threat to their industry, people in attendance said: election results were coming in overwhelmingly against the massive build-out of computing capacity that Silicon Valley is counting on to power its future.

France's Riots Were Fueled by an 'Ultra Left' Faction That Lives Off-the-Grid

BUSSIERE-BOFFY, France-A convoy of heavily armed tactical police arrived at dawn last month in this hamlet deep in the French countryside, where cows and horses graze near camper vans belonging to people who lead itinerant, off-the-grid lives.

They broke down the front door of a stone house and arrested a slender 34-year-old environmental activist named Hodei Ciarra Docampo. He was suspected of helping set a fire that ripped through the neo-Renaissance city hall of Limoges, in one of the most shocking acts of destruction during the protests that have roiled France over the past month.

The Billions of Dollars in Orders Complicating an End to U.S. Aid to Israel

Israel has ordered billions of dollars worth of American military hardware beyond what the U.S. has committed to paying for, illustrating how hard it would be to phase out Washington's funding for the country.

The U.S. has already pledged nearly $7 billion in annual U.S. military aid over the next two years. Beyond 2028, Israel would need approximately $10 billion to pay for outstanding orders as of April 1, according to a State Department document sent to Congress and reviewed by The Wall Street Journal. It's unclear how much that amount might have changed since then.

Meta President Says Midterm Results Will Make Building Data Centers Harder

Getting data centers built is "going to be harder" after the midterm elections, said Meta Platforms President Dina Powell McCormick-but perhaps not as hard as it now appears.

Speaking at the WSJ Tech conference on Wednesday, Powell McCormick said "many different factors" played into the Democrats' widespread victories, with data center opposition front and center in many campaign ads and exit polls.

Arm Holdings Sales Climb 27% on AI Demand

Arm Holdings recorded 27% growth in revenue in its fiscal second quarter, as artificial intelligence demand fuels growth.

The semiconductor company posted a profit of $130 million, or 12 cents a share, compared with $238 million, or 22 cents a share, a year earlier.

Write to singaporeeditors@dowjones.com

Expected Major Events for Thursday 06:45/SWI: Oct Unemployment

07:00/GER: Sep Manufacturing orders

07:00/GER: Sep Manufacturing turnover

07:00/NOR: 3Q Labour force survey

07:45/FRA: Sep Industrial production index

08:00/CZE: Sep Retail trade

09:00/UK: Oct UK monthly car registrations figures

09:00/ITA: Sep Retail Sales

09:00/NOR: Norges Bank monetary policy decision

09:30/UK: Oct S&P Global UK Construction PMI

10:00/EU: Sep PPI

10:00/CYP: Oct CPI

12:00/UK: UK interest rate decision

13:30/CZE: Czech interest rate decision

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November 05, 2026 00:15 ET (05:15 GMT)

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