US Inflation Week. UK Business Confidence Collapses. A Bitcoin Bust?

Baltic Dry Index. 2583 +23       Brent Crude 63.17

Spot Gold  4253            US 2 Year Yield 3.54 +0.07  

US Federal Debt. 38.356 trillion

US GDP 31.613 trillion.

Arbitrary government power is being multiplied daily by the now practically unchallenged assumption that wherever there is any problem of any kind to be solved, government is the agency to step in and solve it.

Henry Hazlitt

Normally December is a good month in the stock casinos as the professional money management sharks dress up stocks and stock indexes for the all important money sharks year-end bonuses.

But I suspect this time round it’s different. In December 2025 it’s probably time to join Berkshire Hathaway in selling stocks to lock in 2025 profits and raise cash ahead of an AI crash in 2026.

Stock futures are little changed after major U.S. indexes snap five-day win streaks: Live updates

Updated Mon, Dec 1 2025 6:20 PM EST

Stock futures are relatively flat Monday night after a weak start to December trading.

Futures tied to the Dow Jones Industrial Average were barely changed. The S&P futures and Nasdaq 100 futures also were hovering near the flatline.

The major U.S. indexes began the week in the red, ending five-day win streaks on Monday. Risk-off sentiment has pressured the bull market in recent weeks as worries of persistent inflation, elevated valuations and returns on artificial intelligence spending weigh on investors.

The slump in cryptocurrencies intensified during the previous session as bitcoin dropped 6% and recorded its worst day since March. Crypto stocks Coinbase and Robinhood each declined more than 4%. November’s standout “Magnificent Seven” stock, Google parent Alphabet, took back some gains and fell 1.7%, while other tech heavyhitters Palantir and Broadcom also declined. Gold prices and bond yields rose, meanwhile.

Although November was a downbeat month for tech stocks, and saw both the S&P 500 and 30-stock Dow eke out small gains, investors are watching for catalysts that could lead to a year-end rally.

Traders are currently optimistic that the Federal Reserve will announce an interest rate cut on Dec. 10 at conclusion of its next policy meeting. Markets are pricing an 87.6% chance of a cut during the upcoming meeting, which is much higher than the odds from mid-November, according to the CME FedWatch tool.

“Bulls still enjoy a strong tailwind from technical and fundamental factors as we approach year-end. On the technical front, December remains a strong seasonal month, fund flows have been steady, risk metrics have improved, the S&P 500 has surged back above the 50-day moving average, breadth has improved, yet sentiment remains historically weak,” said Mark Hackett, chief market strategist at Nationwide. “The bear’s argument relies on concern over the sustainability of the AI buildout and elevated valuations.”

December tends to be a strong month for the broader market. The S&P 500 averages a gain of more than 1% in December, making it the third-best month of the year for the benchmark in records going back to 1950, according to the Stock Trader’s Almanac.

Stock market today: Live updates

South Korea auto stocks rise after U.S. Commerce Secretary confirms tariffs lowered to 15%

Published Mon, Dec 1 2025 6:40 PM EST

Shares of South Korean auto companies rose Tuesday after U.S. Secretary of Commerce Howard Lutnick confirmed that lower U.S. auto tariffs of 15% on South Korea would retrospectively come into effect, starting Nov. 1.

“We are also removing tariffs on airplane parts and will ‘un-stack’ Korea’s reciprocal rate to match Japan and the EU,” Lutnick said, according to an X post by the U.S. Department of Commerce.

Carmakers Hyundai Motor and Kia Corp rose nearly 5% and 3%, respectively.

South Korea’s Kospi jumped 1.02%, while the small-cap Kosdaq was down 0.13%.

South Korea’s headline inflation in November rose 2.4% year on year, according to government data Tuesday, exceeding the 2.35% rise expected by economists in a Reuters poll. Core inflation, which strips out prices of fresh food and energy, rose 2% from a year earlier.

The latest figure is unchanged from October’s inflation rate, supporting the case for the central bank to keep interest rates on hold. The Bank of Korea had kept rates unchanged at 2.5% for a fourth straight meeting last Thursday.

Benchmark indexes in the broader Asia-Pacific region mostly rose Tuesday.

Japan’s benchmark Nikkei 225 index added 0.54%, and the Topix index was up 0.44%. The financials, energy and basic materials sectors led gains on the index.

Among the top movers on the Nikkei 225 was industrial robot maker Fanuc, which was up 5.86%. NGK Insulators, which manufactures diesel particulate filters, advanced as much as 6%, and electrical equipment company Fujikura added 2.29%.

Yields on the 10-year Japanese Government Bonds rose to 1.88%, the highest since June 2008, amid growing speculation of an interest rate hike by the central bank as soon as this month.

Meanwhile, yield on the 20-year JGB rose to 2.915%, the highest since 1999, and yield on the 30-year JGB rose to an all-time high of 3.411%.

Australia’s ASX/S&P 200 rose 0.12%.

Hong Kong’s Hang Seng Index added 0.49% at the open, while mainland China’s CSI 300 declined 0.17%. Shares of Alibaba Group climbed nearly 3% in Hong Kong, rising for a third straight session, after the tech giant launched its Quark artificial intelligence glasses in China on Nov. 27.

India’s Nifty 50 opened 0.22% lower, and the BSE Sensex index fell 0.37%. Bajaj Housing Finance was among the top losers on the Nifty 50, falling more than 8%, after its parent company Bajaj Finance said it was offloading up to 2% of its stake in the subsidiary.

U.S. equity futures were little changed during Asian hours after all three key benchmarks snapped five-day gain streaks as a crypto sell-off dented market sentiment.

The S&P 500 lost 0.53% to end at 6,812.63, while the Nasdaq Composite shed 0.38% to finish at 23,275.92. The Dow Jones Industrial Average pulled back by 427.09 points, or 0.9%, to settle at 47,289.33.

Overnight, bitcoin plunged around 6% to trade below $86,000, denting investor sentiment and pressuring the broader stock market. It was trading at $86,866.49 as of 9:30 a.m. Tuesday (8:30 p.m. ET Monday) Singapore time. The digital currency has struggled to stay above $90,000 since it fell below that level late last month for the first time since April.

Other crypto-related stocks, including Coinbase and Strategy, also fell in Monday’s session in U.S. trading hours.

Shares of artificial intelligence-related names, Broadcom and Super Micro Computer lost more than 4% and 1%, respectively, indicating more profit-taking in the sector.

Asia-Pacific markets: Crypto sell-off, Nikkei 225, Hang Seng Index

Bitcoin logs its worst day since March

Published Mon, Dec 1 2025 2:30 AM EST

Bitcoin and ether fell sharply on Monday, as the recent sell-off in cryptocurrencies resumed.

Bitcoin was last seen at about $85,894.03 at 04:19 p.m. ET, a 6% slide. Ether dropped 8.4% to hit $2,776.39.

Solana had fallen more than 9%, and was last seen below $125, while other closely watched tokens were also in the red.

In Asia, a statement by the People’s Bank of China on Saturday warning of illegal activities relating to digital currencies heaped pressure on Hong Kong-listed shares of digital assets-related companies, which retreated during Monday’s session.

The fresh slide in digital assets chimes with a broader risk-off sentiment at the start of a new month.

Ben Emons, founder and CIO of Fedwatch Advisors, said that people remain “nervous” following the recent bitcoin sell-off, adding that Monday’s reversal has broadly been attributed to a $400 million exchange liquidation.

Speaking with CNBC’s “Squawk Box Europe” on Monday, he highlighted the sizable leverage across bitcoin exchanges, which is up to 200x in some instances. With an estimated $787 billion outstanding leverage in perpetual crypto futures, against some $135 billion outstanding in ETFs, “you can do the math,” Emons said.

“There is still a lot of leverage in bitcoin out there. We can expect to some more of these liquidations if bitcoin prices don’t get off the lows from here,” he added.

Monday’s dip came on the back of a sharp sell-off in October, which also moved the stock market, Emons said, with bitcoin showing greater correlation with certain indexes including the Nasdaq.

“It’s predominantly retail driven, that’s the worrying part of it, because retail reacts very differently than institutional [investors],” he said, noting the decentralized nature of crypto exchanges and opaque nature of the asset class.

“That is something to reckon with going forward from here, as more and more leverage is used in this space.”

More

Bitcoin logs its worst day since March

In other (UK) news.

Business confidence drops to post-pandemic lows after Budget

Monday 01 December 2025 6:00 am 

Business confidence in bosses’ own organisations fell to the lowest level in over five-and-a-half years after the Budget, a leading survey has suggested, as the absence of growth policies in Rachel Reeves’ statement dampened leaders’ moods. 

The Institute of Directors’ monthly survey indicated bosses were fearing for the worst after last Wednesday’s much-anticipated event, with key metrics about businesses’ performances dropping to five-year lows. 

After the Budget was delivered, business confidence in organisations’ own growth sharply dropped to -20 from -5 in a survey held before the statement. 

This was the second-lowest reading since April 2020, a month into the first lockdown.

The set of data gathered after last Wednesday provides another damning assessment of Reeves’ Budget after the Office for Budget Responsibility (OBR) said none of the growth-focused policies in the statement would boost output. 

Growth predictions were also downgraded across the entire forecast period, which is likely to keep businesses on edge about their prospects. 

In its headline metric, overall business confidence about the UK economy in a snap poll after the Budget barely changed, inching up by one point from -73 to -72, demonstrating the sense of peril directors are left in.  

Budget fails to ease cost expectations

IoD researchers also showed that revenue expectations fell into negative territory at -8, which was the lowest reading since September 2020 while the net balance for investment intentions dropped to -39, the second lowest reading on record after May 2020. 

Headcount expectations falling to -29, near levels seen during the pandemic, could also alarm Labour officials given they have made growing the UK economy their central mission in government. 

The Budget statement, which was focused on curbing the cost of living and setting the conditions for lower borrowing costs, failed to dramatically ease cost expectations as the net balance reading remained high at 82. 

Firms said employment taxes and business taxes were among the top three factors hampering activity, with the UK’s poor economic conditions topping the list. 

Anna Leach, chief economist at the IoD, said the fact that four in five business leaders viewed the Budget negatively meant it was “no surprise” that confidence metrics remained at near-record lows. 

“The message from this Budget is that work remains to be done to lift the UK’s growth prospects,” Leach said. 

“The immediate outlook for business investment and employment has weakened further, and that will require further attention.”

At the end of last week, the Lloyds Bank business barometer, which has tended to offer more sympathetic readings of business confidence, showed hiring intentions and trading prospects among organisations dropping in November. 

Its survey said business confidence had dropped over the course of the month, though it remained above long-term averages. 

Business confidence drops to post-pandemic low after Budget

Global Inflation/Stagflation/Recession Watch.

Given our Magic Money Tree central banksters and our spendthrift politicians, inflation now needs an entire section of its own.

It is possible to increase paper-money income to any amount by debasing the currency. But real income can only be increased by working harder or more efficiently, saving more, investing more, and producing more.

Henry Hazlitt

How sticky is US inflation?

Market Questions is the FT’s guide to the week ahead

30 November 2025

Figures on US inflation for September will finally be published on Friday, just a few days before policymakers at the Federal Reserve take their hotly anticipated December decision on interest rates.

The figures — long delayed by the federal government shutdown — are expected to show the headline price index of personal consumption expenditures rising 0.3 per cent month on month in September, according to a Reuters poll of economists, in line with the rate in August. Year on year, the PCE price index is expected to have risen 2.8 per cent, up slightly from 2.7 per cent in August.

The Reuters poll shows core PCE inflation — the central bank’s preferred measure, as it excludes volatile food and energy prices — holding steady at 0.2 per cent month on month and 2.9 per cent year on year, unchanged from August.

“The Fed will look at it as a definitive December cut confirmation,” said Florian Ielpo, head of macro at Lombard Odier. But, he added, “the stickiness of the print” will be a hint to investors as to how long the Fed will keep rates unchanged in the first half of 2026, if a quarter-point cut is confirmed on December 10.

Analysts at Barclays expect core PCE inflation to continue “firming” over the next few months due to the upward pressure of tariffs on consumer prices, after “slow progress on disinflation recently”.

Although annual inflation remains above the Fed’s 2 per cent target, traders are pricing in a roughly 80 per cent chance of a cut of 0.25 percentage points at the December meeting, with another two quarter-point cuts priced in by about the middle of next year, according to levels implied by futures markets. Rachel Rees

Could inflation data nudge the ECB from its ‘good place’? Investors and central bankers seem comfortable that European monetary policy is in a “good place”, as ECB president Christine Lagarde recently put it. Traders are almost unanimous that rates will stay on hold in December, and indeed most expect the ECB’s policy rate to remain at 2 per cent for the next year.

That said, both groups will be watching Eurozone inflation next week for signs of any wobble. Economists polled by Reuters expect inflation to have remained unchanged at 2.1 per cent year on year in November, close to the central bank’s 2 per cent target.

But minutes from the ECB’s October meeting show that the “two-sided” risks to inflation were a central topic of conversation. According to the minutes, policymakers agreed that “the outlook for inflation continued to be more uncertain than usual on account of the still volatile global trade policy environment”. 

For now, though, it seems unlikely that such uncertainty will emerge in the November print. Salomon Fiedler, economist at Berenberg, said the ECB remained in a “good spot” and that inflation prints deviating just a few tenths of a percentage point around the 2 per cent target would be “within the allowable margin of error”.

“We see no good reason for the ECB to shift its monetary policy stance,” Fiedler said, adding that his conviction was confirmed by the inflation prints of Eurozone countries including Germany, France and Italy, which were published ahead of the wider bloc’s print. Emily Herbert

More

How sticky is US inflation?

Covid-19 Corner

This section will continue only occasionally when something of interest occurs.

 

Technology Update.

With events happening fast in the development of solar power and graphene, among other things, I’ve added this section. Updates as they get reported.

Chinese EV batteries, caveat emptor. Approx. 16 minutes.

The Chinese E-Bike Fire Epidemic They Don’t Want You to Know About

The Chinese E-Bike Fire Epidemic They Don’t Want You to Know About

Next, the world global debt clock. Nations debts to GDP compared.

World Debt Clocks (usdebtclock.org)

When the government makes loans or subsidies to business, what it does is to tax successful private business in order to support unsuccessful private business.

Henry Hazlitt