EMEA Morning Briefing: Tech Rout Continues
MARKET WRAPS
Watch For:
Eurozone retail trade, Germany industrial production; trading updates for Daimler ã 겨차, IAG, Next, EDP, Rightmove
Opening Call:
European stock futures were lower after Asia stocks broadly sold off. U.S. Treasury yields were flat, the dollar strengthened. Gold fell and oil rose.
Equities:
European equity futures fell as investors continued to further digest the results of U.S. midterm elections, with the Nasdaq falling into correction territory as a tech-stock selloff wiped out an estimated $2.5 trillion in total market value.
Market price action reflects a classic flight-to-safety move, said Masahiko Loo, chief fixed income strategist at State Street Investment Management.
While the blue wave in the U.S. raises the prospect of greater scrutiny around data centers and AI infrastructure, it does not signal the end of the AI investment cycle, he said. "Corporate investment, strategic competition and demand for compute remain intact."
Loo expects market volatility to settle as markets refocus on longer-term fundamentals, with looming release of U.S. non-farm payrolls likely the nearest catalyst.
"History also argues against over reacting to election headlines, with the S&P 500 having not declined in the 12 months following a U.S. midterm election since 1930," he added.
Forex:
The U.S. dollar strengthened against major currencies. Diminishing risk appetite amid the U.S. tech-stocks selloff overnight--driven by earnings and postelection fears about curbed data-center development--might weigh on sentiment.
The technology selloff appears to reflect a reassessment of the AI investment outlook and a positioning-driven liquidation, said Commerzbank Research analysts.
Bonds:
The yield on U.S. Treasurys were flat. "The bottom in yields is hard to call here from here," said Jack Chambers, interest rate strategist at ANZ.
"The U.S. growth story is still strong right now, and at some point investors should expect that to offset concerns about the possibility of future AI regulation," he said, adding that those themes will be the key market tension for a while yet.
Energy:
Oil prices rose to conclude a volatile week. Hopes that the U.S. midterm result could lead to a resolution in the Middle East led to a sharp selloff, but oil regained ground as markets reassessed the initial reaction.
Traders appear to think the selloff looks overdone, said ANZ research analysts.
Tensions across the Middle East remain elevated, with Saudi Arabia issuing alerts of potential danger in Red Sea oil export Yanbu, they added.
Metals:
Gold prices were lower amid better risk sentiment. Central banks added a net 321 tons of gold to their reserves in 3Q, according to the World Gold Council.
Meanwhile, Goldman Sachs maintains a long-term constructive view on the structurally strong central bank demand, but lowered its end-2026 gold forecast to $4,150 an ounce from $4,650 an ounce on the implications of the Fed's hawkish shift in recent months for positioning.
Copper fell as weakness in technology stocks weighed on sentiment in the copper market.
Investors were concerned that demand may be negatively impacted by any slowdown in the data center buildout, ANZ said.
However, there continue to be signs of tightness in the physical market in China given output cuts at Chinese smelters due to weak margins, ANZ added.
TODAY'S TOP HEADLINES
Wall Street Gets $2.5 Trillion AI Reality Check With Historic Rout of Tech Stocks
Two days after the midterm elections swept a bloc of artificial-intelligence skeptics into power, the new reality slammed into Wall Street.
Thursday's stock-market wipeout left few corners of the tech sector unscathed. Asian chip makers, Texas power producers, New Jersey cloud-computing providers, Silicon Valley software makers, contractors and data-center developers all tumbled, often in unison, in a selloff that appeared to feed on itself as the day wore on.
The Birkin Fund Cashing In on the Hermès Luxury-Resale Market
Investors have looked to capitalize on the rising prices of hard-to-find Rolex watches and rare French wine. A new fund offers the prospect of profiting by flipping exclusive Hermès handbags.
Luxus, a New York-based asset-management firm, recently closed the first of three funds. The $1 million fund netted a nearly 24% return on several-dozen bags over a 15-month span.
AI Companies Scramble to Navigate a World Hostile to Data Centers
The dust from the midterms had hardly settled Wednesday when OpenAI leaders began reckoning with an urgent question: would the outcome make it harder to secure the vast amounts of computing power the company needs to keep growing?
During a Q&A with employees, OpenAI Chief Executive Sam Altman fielded questions about data centers and public sentiment on AI, according to people familiar with the matter. A day earlier, a wave of data-center opposition had helped candidates promising to freeze development win statehouses in Texas, Georgia, Ohio and Michigan-all major states for data-center sites.
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Expected Major Events for Friday 00:01/UK: Oct BRC-Sensormatic IQ Footfall Monitor
05:30/NED: Sep Consumer Spending
07:00/GER: Sep Industrial Production Index
07:00/ROM: Sep Retail trade
07:00/DEN: Sep Industrial production & new orders
07:00/UK: Oct Lloyds House Price Index
07:00/NOR: Sep Industrial Production Index
07:30/HUN: Sep Retail Sales
07:45/FRA: 3Q Flash estimate of job creation
07:45/FRA: Sep Foreign trade
07:45/FRA: Sep Balance of payments
08:00/CZE: Sep External trade
08:00/CZE: Sep Industry, Construction
08:00/AUT: Oct Wholesale Price Index
08:00/SPN: Sep Industrial Production
08:00/SVK: Sep Internal trade, incl Wholesale & Retail
08:00/SWI: Oct SNB foreign currency reserves
08:00/SWI: Oct Consumer Sentiment Index
09:00/ICE: Oct External trade, preliminary figures
10:00/EU: Sep Retail trade
10:00/GRE: Sep External Trade (provisional data)
10:00/MLT: Sep Industrial Production Index
11:00/FRA: Sep OECD CPI
11:00/IRL: Oct Irish Live Register latest monthly figures
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(END) Dow Jones Newswires
November 06, 2026 00:15 ET (05:15 GMT)
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