Alphabet's latest leap - up over 4% before markets opened - was set off by an unusual twist in Silicon Valley's increasingly tangled web: Meta, normally a fierce rival, is reportedly weighing billions in spending on Google's AI chips. The partnership would begin with chip rentals next year and stretch to hardware for Meta's data centres by 2027. 

Broadcom, a supplier to Alphabet's AI-chip ambitions, climbed too. Nvidia and AMD - normally the sector's unshakeable titans - slipped nearly 4% as Google appeared to position itself for a more heated contest in the race for AI dominance. Alphabet's stock has now surged close to 70% this year and is flirting with a $4 trillion valuation.

The Nasdaq, meanwhile, just enjoyed its best day in half a year as investors bought tech names after weeks of fretting about excessive valuations and ballooning AI budgets. For now, the fear of an AI bubble has given way to the broader enthusiasm of a sector that refuses to slow down. 

The most reassuring noises this week came not from chipmakers but from the Federal Reserve. A chorus of dovish remarks - from John Williams, Christopher Waller and even Mary Daly - has convinced traders there is now an 80% chance of a December rate cut, up from about 40% just days ago. 

The incoming data will test this optimism. Retail sales and consumer confidence for September and November, respectively, will shed light on how robust the American shopper remains amid tariff-driven price pressures and headline-grabbing layoffs. A delayed producer-price report, feeding directly into the Fed's preferred inflation gauge, adds another layer of suspense.

If the readings are soft, the soft-landing narrative stays intact. Too soft, and whispers of stagflation creep in.

Consumer behavior will be decisive as the holiday season kicks in. Early signs are mixed. Kohl's soared 22% after raising its profit forecast for the second time this year. Best Buy, too, nudged up after lifting its outlook. But Burlington Stores stumbled when quarterly sales fell short.

The pressure is enormous: the few days between Thanksgiving and Cyber Monday can make or break annual ledgers. Investors will also parse earnings from Abercrombie & Fitch, Analog Devices, Autodesk, Dell, HP Inc. and Workday, hoping to determine whether America's shoppers remain confident.

Oil prices dipped, though not dramatically, helped earlier by risk-on sentiment and expectations of a December Fed cut. Sanctions are tightening around Russian exports, widening discounts for crude destined for India. Gold, caught between steady yields and a strong dollar, remains trapped in a familiar range. Even bitcoin joined the party, climbing toward the $90,000 level. 

Markets have begun to tentatively price in progress on a Ukraine peace deal. That remains fragile. Donald Trump is pushing for a settlement shaped in large part by a 28-point plan drafted by Steve Witkoff and Jared Kushner, assembled mid-flight after their success mediating a Gaza ceasefire.

In Asia-Pacific, Japan's market resumed trading slowly after a public holiday. The Nikkei 225 closed flat, showing little enthusiasm for the US tech rebound. China proved more responsive, with the CSI 300 gaining a solid 0.9%, while the Hang Seng added a more modest 0.2%. South Korea, which often tracks the Nasdaq closely, remained cautious too: the KOSPI edged up just 0.3%. India and Australia each eked out a 0.1% rise. In Europe, leading indicators are bearish, while US futures are hovering just below zero.

Today's economic highlights:

On today's agenda: the FHFA House Price Index, the Conference Board Consumer Confidence, pending home sales, and the Richmond Fed Manufacturing Index. See the full calendar here.

  • Dollar index: 100,022
  • Gold: $4,118
  • Crude Oil (BRENT): $61.84 (WTI) $57.35
  • United States 10 years: 3.99%
  • BITCOIN: $87,425

In corporate news:

  • Meta is seeing strong interest in its AI-powered Ray-Ban smart glasses ahead of the holidays, as U.S. sales of smart glasses triple year-over-year and consumer demand continues to rise.
  • Klarna announced KlarnaUSD, its first dollar-backed stablecoin, aimed at cross-border payments and faster transactions, with full rollout expected in 2026.
  • Best Buy raised its annual forecast and reported strong holiday demand and robust third-quarter computing and gaming sales, boosted by the launch of Nintendo's Switch 2.
  • Analog Devices posted a 26% year-over-year revenue increase and nearly doubled quarterly profit, driven by growth in industrial and communications segments.
  • eBay is under investigation by French prosecutors for allegedly selling illicit goods on its platform following a watchdog's report.
  • Alibaba reported a 53% drop in net profit due to intense competition in food delivery, but its AI and cloud segments saw strong growth, lifting investor sentiment.
  • Cirsa swung to a third-quarter profit and raised its annual earnings guidance, planning selective M&A activity to finish 2025.
  • Spotify is planning to raise U.S. subscription prices in Q1 2026, its first increase in the country since July 2024, as part of its global pricing strategy.
  • NIO narrowed its Q3 net loss amid record monthly deliveries and improved margins, forecasting a strong Q4 with up to 125,000 vehicle deliveries.
  • Alphabet is in talks to sell AI chips to Meta, potentially challenging Nvidia's dominance in data-center processors.
  • Domino's Pizza Group CEO Andrew Rennie resigned as the company halts plans for a second brand acquisition and delays its capital markets day.
  • Dangote partnered with Honeywell to expand refining capacity to 1.4 million barrels per day by 2028, aiming to become the world's largest refinery operator.
  • Zoom raised its annual forecast on strong demand for AI tools supporting hybrid work and announced a $1 billion share repurchase expansion.
  • Burlington Stores reported Q3 adjusted EPS of $1.80 and 1% same-store sales growth, reaffirming its outlook for modest sales gains this fiscal year.
  • Amazon is expanding its AI and data center capabilities with significant investments, including a $15 billion expansion in Indiana and a $50 billion project for U.S. government clients.
  • Agilent Technologies exceeded fourth-quarter revenue estimates with $1.86 billion, driven by strong demand for lab and medical diagnostic equipment.
  • Keysight reported strong Q1 results due to sustained AI data center demand.

Analyst Recommendations:

  • Accenture Plc: Baptista Research downgrades to hold from outperform and reduces the target price from USD 282.20 to USD 279.20.
  • Avalonbay Communities, Inc.: Barclays upgrades to overweight from market weight and reduces the target price from USD 229 to USD 216.
  • Camden Property Trust: Barclays downgrades to market weight from overweight and reduces the target price from USD 127 to USD 118.
  • Dell Technologies Inc.: Aletheia Capital Limited downgrades to hold from buy.
  • Estee Lauder: Rothschild & Co Redburn downgrades to sell from neutral and reduces the target price from USD 83 to USD 70.
  • Exact Sciences Corporation: Canaccord Genuity downgrades to hold from buy and raises the target price from USD 85 to USD 105. 
  • Albemarle Corporation: HSBC maintains its hold recommendation and raises the target price from USD 87 to USD 117.
  • Applovin Corporation: Daiwa Securities maintains its outperform rating and raises the target price from USD 455 to USD 585.
  • Dillard's, Inc.: JP Morgan maintains its underweight recommendation and raises the target price from USD 411 to USD 524.
  • Dupont De Nemours: Deutsche Bank maintains its buy recommendation and reduces the target price from USD 90 to USD 46.
  • Inspire Medical Systems, Inc.: Leerink Partners maintains its market perform recommendation and raises the target price from USD 94 to USD 127.
  • Symbotic Inc.: Cantor Fitzgerald maintains its overweight recommendation and raises the target price from USD 60 to USD 82.
  • The Tjx Companies: President Capital Management Corp maintains its buy recommendation and raises the target price from USD 138 to USD 168.