“Stocks Fall as Fed, AI Earnings Shake Global Markets”
Source: Global Finance News
Reporter: MD Rubel Islam
Published: Dec -10 , 2025 — 8:10 PM (GMT+6)
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| “Global markets wobble as Fed decisions, AI earnings, and commodity surges drive uncertainty across stocks, currencies, and metals.” |
Detailed News”
- Stocks Recoil as Fed Signals Shake Global Markets
- Global Stocks Fall Ahead of Fed Decision & AI Earnings
- Volatility Surges as Global Stocks Recoil Before Fed & AI Earnings
Stocks Recoil as Fed Uncertainty and AI Earnings Shake Global Markets
Global stocks fell sharply as investors reacted nervously to the upcoming Federal Reserve decision and rising concerns around AI earnings from major technology players. Market volatility increased across Europe, Asia, and the United States as traders reassessed risk, repositioned portfolios, and braced for potential surprises from the Fed’s dot plot forecast. With the S&P 500 under pressure, U.S. futures moving lower, and Treasury yields climbing, investors are adjusting expectations for rate cuts, inflation, and market growth. At the same time, AI-related stocks—especially Oracle and Broadcom—are facing valuation pressure ahead of earnings. Together, these forces are driving one of the most uncertain periods in recent months.
Global Stocks Lose Momentum — Investors Brace for High Volatility
Global stock markets started the week weaker as fear and uncertainty spread across investor sentiment. European stocks opened lower, Tokyo markets turned red, and U.S. futures showed early declines. The combination of rate uncertainty, rising Treasury yields, and a volatile dollar index created a challenging environment. Momentum funds, which drove major gains earlier in the year, reversed positions quickly, leading to sharp intraday swings across major indices. Market participants are now waiting to see whether December’s typical “Santa Rally” can still materialize despite worsening macroeconomic signals. For now, fear outweighs optimism.
Key Reasons Behind the Market Recoil
The primary source of fear comes from the uncertainty surrounding the Fed’s next move. Investors widely expect a 25 basis point rate cut, but the real concern lies in what comes after. The Fed may not commit to more cuts in 2025, especially if inflation proves sticky or the economy remains strong. This lack of clarity is enough to trigger risk-off behavior across global markets. AI earnings jitters are adding further pressure, as overstretched valuations could collapse if results disappoint. Rising Treasury yields make equities less attractive, while currency volatility adds complications for multinational companies. Overall, markets are reacting to a broad mix of financial stress indicators.
Fed Rate Cut, Dot Plot, and Jerome Powell — The Market’s Biggest Trigger
The Federal Reserve will deliver its highly anticipated rate decision soon, and global markets are on edge. Investors believe there is an almost 90% chance of a 25 bps cut, but what comes next is unclear. The Fed’s dot plot, which outlines policymakers’ expectations for future rates, is expected to show fewer cuts than markets have priced in. If the dot plot signals only one rate cut in 2025, stocks may fall sharply. If it shows two or three, markets could rally strongly. Jerome Powell’s wording will also have tremendous influence, as even subtle tones—hawkish or dovish—can shift billions of dollars instantly.
What Jerome Powell Might Signal
Powell could take three possible tones in the press conference. If he suggests inflation progress has stalled, markets will likely drop. If he adopts a neutral stance and says the Fed is being cautious, stocks may recoil but remain stable. A dovish tone, hinting that more cuts are possible if economic weakness grows, could spark a strong rally. Investors will analyze every line of Powell’s remarks, focusing on terms like “inflation progress,” “financial stability,” and “policy flexibility.” The Fed’s communication will decide the market direction for the next several weeks.
Currency Market Shock — Yen Hits Record Low as Dollar Swings
The currency market is experiencing intense turbulence as the Japanese yen crashes to record lows while the dollar index jumps erratically. Treasury yields are rising at a fast pace, attracting investment away from the yen. Japan’s central bank remains committed to its loose monetary policy, widening the rate differential with the United States. This is causing investors to dump yen in favor of higher-yielding assets. Meanwhile, the euro and the British pound are fluctuating sharply as markets reevaluate interest rate expectations across Europe. Currency instability is now adding another layer of risk to global markets.
Why the Yen is Collapsin
The yen has weakened for several reasons. Strong U.S. Treasury yields make American assets more attractive, causing heavy outflows from Japan. The Bank of Japan remains hesitant to increase interest rates, maintaining ultra-easy monetary policy. Rising global uncertainty also pushes investors toward the dollar rather than the yen, reversing traditional safe-haven behavior. These combined forces pushed the yen to a historic low, raising concerns about imported inflation and potential government intervention. For now, the yen remains vulnerable until the BOJ takes significant action.
Silver Hits Record High — Momentum Funds Drive an Explosive Rally
Silver prices shocked global markets by hitting an all-time high of $61.61 per ounce. This dramatic surge is driven primarily by momentum funds and algorithmic trading systems reacting to strong buying patterns. The metal’s industrial demand is surging due to rising use in solar energy, electric vehicles, semiconductor manufacturing, and data centers. The Silver Institute released a bullish outlook, predicting stronger demand in the coming decade. All of these factors combined triggered rapid buying, pushing silver to record-breaking levels within days.
Why Silver is Outperforming Gold and Other Metals
Silver is benefiting from both investment demand and industrial expansion. Solar energy installations worldwide are increasing rapidly, requiring significant amounts of silver. Electric vehicle production is rising, and EV batteries use silver as a conductive material. AI data centers and cloud infrastructure require high-performance components, boosting silver demand further. Momentum funds detected these trends early and accelerated buying through automated strategies. As a result, silver has outpaced gold, copper, and other key metals in recent weeks, making it one of the strongest commodity performers.
Gold Prices Stable Near Record Levels — Investors Await Fed Clarity
Gold remains close to its record highs near $4,200 per ounce, supported by geopolitical uncertainty and central bank purchases. Unlike silver, gold has not surged aggressively but remains stable due to strong safe-haven demand. Investors are waiting for the Fed decision before making large moves. Inflation figures remain uncertain, and fears of market volatility are keeping gold prices supported. Several countries continue to accumulate gold for long-term reserves, further strengthening the metal’s position in global markets.
Why Gold is Not Falling Despite Market Pressure
Gold is holding strong for three main reasons. First, central banks around the world are stockpiling gold, increasing structural demand. Second, market volatility is encouraging investors to shift funds into safe-haven assets. Third, uncertainty around inflation and interest rates is preventing large sell-offs. While not rallying like silver, gold remains one of the most stable assets during this turbulent period. Its behavior suggests investors expect prolonged economic uncertainty worldwide.
Oil Prices Edge Higher as Iraq Restores Production — Brent Crude Under Pressure
Oil markets saw slight gains as Iraq restored production at the West Qurna 2 oilfield, operated by Lukoil. The increase in supply capped potential price rallies, keeping Brent crude under mild pressure. Global demand remains weak due to slow economic activity in China and Europe. The United States is showing mixed signals, with some indicators pointing to weaker consumption. For now, oil prices remain range-bound, with supply increases balancing demand weakness.
Key Forces Driving Oil Market Movement
Four major factors are influencing oil prices. First, Iraq’s restored production is adding fresh supply to global markets. Second, weak demand from major economies is preventing prices from rising significantly. Third, geopolitical tensions remain moderate, reducing risk premiums. Fourth, the potential Fed rate cut could influence energy demand projections. Overall, the oil market is stable but vulnerable to rapid shifts based on global economic performance.
AI Earnings and Tech Sector Risk — Oracle & Broadcom in the Spotlight
AI stocks are facing growing pressure as investors worry about earnings from Oracle and Broadcom. These companies are now considered essential indicators of the broader AI landscape. High AI valuations mean even a slight earnings miss could trigger sharp declines across the tech sector. Cloud spending trends and capital expenditure (capex) intentions are key data points investors want to see. Any signal of slowing growth may spark widespread selling.
Why the AI Sector Faces Elevated Risk
The AI sector is vulnerable due to extreme valuations, heavy investment requirements, and rising competition. Cloud infrastructure costs are increasing, reducing profit margins for companies scaling AI operations. If Oracle or Broadcom reduce their capex outlook or offer conservative forecasts, investors may reposition out of AI stocks. At the same time, global demand for AI remains strong, but revenue timing remains uncertain. This mismatch creates high volatility for AI-related equities.
Economic Data Delays and Government Shutdown Risks Add to Uncertainty
The possibility of a U.S. government shutdown has added further pressure to the markets. Key reports such as payroll data and inflation figures may be delayed if government operations slow down. Investors rely heavily on these reports to understand economic health. Without them, market uncertainty increases dramatically. The delay in economic signals means investors must rely on incomplete data and market behavior, raising the risks of volatility spikes.
Market Outlook — What Investors Should Watch Next
The next seven days will be critical for global financial markets. The Fed’s rate decision and dot plot will shape expectations for months. AI earnings from Oracle and Broadcom will determine whether the tech sector continues to lead or undergoes a correction. Treasury yields must stabilize for stocks to recover. Silver and gold trends will signal future commodity market strength. Oil supply and demand will guide energy market movements. Together, these factors will determine global market momentum.
Final Thoughts — A Make-or-Break Week for Global Markets
Investors should closely monitor Treasury yields, Fed guidance, AI earnings, and commodity price shifts. Markets are in a highly sensitive state, where small changes in policy language or earnings forecasts can lead to large price swings. Staying informed and understanding macroeconomic signals is essential f
or navigating the next wave of market volatility. The coming week could define how global markets move into the new year.
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