Good Afternoon. ’Tis the season for record highs, at least if you’re silver, copper, or Amazon’s Trainium chips. While traders rehearse for a potential Fed cut and OpenAI adds another trophy to the shelf, North American trade diplomacy is still stuck on the naughty list. Let’s unwrap today’s stories.

—Rosie, Wyatt, Evan & Conor

🔥 What’s Hot: 🔥

🥶 What’s Not: 🥶

1. Bond Yields Climb as Markets Brace for Fed Decision

The News: Global bond yields pushed higher Thursday, with Japan’s 10-year yield hitting 1.941%, its highest level since 2007, after BOJ Governor Kazuo Ueda signaled uncertainty over how many more rate hikes may be needed. In the U.S., the 10-year Treasury rose to ~4.11% following a sharp, unexpected drop in weekly jobless claims and a retreat in planned corporate layoffs. The S&P 500 spent most of the day flat before inching higher into the close, while Dollar General jumped on solid earnings and Kroger slipped after reporting a quarterly loss.

Why It Matters: Higher yields mean more expensive mortgages, car loans, and corporate borrowing, just as the Fed is widely expected to cut rates next week, an unusual moment where easing expectations meet rising long-term borrowing costs. For markets, Japan’s yield surge underscores how global rate normalization is tightening financial conditions beyond the Fed’s control. And with the October and November jobs reports delayed by the government shutdown, investors are flying into the December 10 Fed meeting with patchier labor data than usual, amplifying uncertainty around the path of rates.

What to Watch: Whether long-term yields keep drifting up despite an expected Fed cut, how BOJ signaling ripples through global risk assets, and how investors treat delayed U.S. labor data once it finally drops.
Source: wsj.com

2. Silver Charges Toward $60 as Weak Jobs Data Fuels Fed Cut Hopes

The News: Silver spiked to an intraday record of $59.66/oz Wednesday before settling near $58, doubling in value year-to-date and easily outpacing gold’s 60% rise. The rally accelerated after ADP reported that U.S. private employers shed 32,000 jobs in November—the biggest drop in more than 2.5 years and far below the +10,000 expected. Markets now peg the odds of a December 9–10 Fed rate cut at 89%, up sharply from 67% a month ago, boosting non-yielding assets like silver.

Why It Matters: For consumers, soaring silver means higher prices for electronics, solar panels, and jewelry, since the metal is a key industrial input. For investors, the surge reflects both macro momentum and real supply stress: global silver is heading for a fifth straight deficit, Shanghai Futures Exchange inventories are at a 10-year low. Record ETF holdings, now roughly 510 million ounces, show investors piling in just as physical tightness deepens.

What to Watch: Whether silver cleanly breaks the $60 psychological ceiling, how Friday’s jobs report shapes Fed expectations, and whether ETF inflows continue at this pace.
Source: reuters.com

3. Trump Signals Possible Exit From USMCA

The News: President Trump may move to withdraw from the USMCA next year, U.S. Trade Representative Jamieson Greer told Politico, calling withdrawal “always a scenario” despite the pact’s structure encouraging members to remain through 2036. Greer also said Trump is weighing separate bilateral negotiations with Canada and Mexico, arguing the two economies warrant different treatment. The comments landed as Canadian business leaders urged Washington to preserve the agreement that governs nearly $2 trillion in annual trade.

Why It Matters: A USMCA exit, or even credible threat, could mean higher prices on cars, food, and consumer goods, plus renewed uncertainty for the 13 million U.S. jobs tied to North American trade. For businesses, the risk of fractured supply chains returns just as automakers, farms, and manufacturers are still adjusting from the last tariff cycle. Politically, the remarks inject volatility into the 2026 mandatory review, where failure to extend the pact could shift it into annual renewal purgatory through 2036. Markets and multinational operators will price in higher regulatory and cost risk if bilateral talks replace the trilateral framework.

What to Watch: Carney’s meeting with Trump at Friday’s World Cup draw, whether U.S.–Mexico talks sideline Canada again, and any signals from industry about accelerated reshoring or contingency planning. If this turns into NAFTA renegotiation 2.0, wear a seatbelt, it could be a bumpy ride.
Source: politico.com

4. Amazon Says Its Trainium Chips Are Now a Multibillion-Dollar AI Business

The News: Amazon CEO Andy Jassy said AWS’s homegrown AI chip, Trainium2, has reached a multibillion-dollar revenue run rate, with 1M+ chips in production and 100,000+ companies using it, making it the dominant engine behind Amazon’s Bedrock AI platform. At re:Invent, AWS unveiled Trainium3, which is 4× faster and more energy-efficient than its predecessor. AWS execs also disclosed that Anthropic alone is driving massive demand, using more than 500,000 Trainium2 chips inside Amazon’s new Project Rainier supercluster to train future Claude models.

Why It Matters: Cheaper, faster AI training chips directly influence model costs, API pricing, and how quickly startups and enterprises can deploy generative AI. Amazon is positioning itself as the only credible alternative to Nvidia’s runaway GPU dominance—critical as supply constraints persist and training costs balloon. AWS’s strategy mirrors its cloud playbook: build proprietary tech with stronger price-performance and bundle it tightly with its platform, locking in marquee customers like Anthropic. If Trainium keeps scaling, it could reshape who controls the economics of the AI stack.

What to Watch: How quickly Trainium3 adoption ramps, whether Trainium4’s promised interoperability with Nvidia GPUs attracts more enterprise workloads, and if AWS can convert OpenAI from a GPU-only tenant into a Trainium customer. If Amazon really starts peeling business off Nvidia, then expect a rebalancing in the AI stock evaluations.
Source: techcrunch.com

5. Copper Jumps to Record Highs as Supply Squeezes Tighten

The News: Copper futures surged past $11,500 per metric ton on December 3, an all-time high, after withdrawals from LME warehouses topped 50,725 tonnes, pushing stocks to 105,275 tonnes, the lowest since July. Prices are now up 30% this year. The rally comes despite Goldman Sachs warning the breakout is “unlikely to last,” projecting a 500,000-ton global surplus in 2025 and no true shortage until 2029.

Why It Matters: Copper’s spike filters into electrical wiring, appliances, EVs, and construction, meaning cost pressures may hit everything from homebuilding to data centers. Supply disruptions across top producers, Ivanhoe Mines, Glencore, and Codelco, all trimmed 2025–2026 output forecasts after seismic events, flooding, and operational setbacks. Meanwhile, tariff jitters are shifting flows to the U.S., where Trump’s 50% copper tariffs on semi-finished products could expand by 2026. Still, Goldman expects prices to trade between $10,000–$11,000 next year, even as long-term demand (and a projected deficit) could push copper to $15,000 by 2035.

What to Watch: Whether tight inventories keep overriding bearish surplus forecasts, how tariff policy shapes 2026 trade flows, and if producers can restore disrupted capacity. And with silver and gold hogging the spotlight this week, copper clearly didn’t want to miss out on the attention.
Source: economies.com

1. Saudi Arabia Slashes Oil Prices to Five-Year Low as Surplus Builds

The News: Saudi Aramco cut the price of its benchmark Arab Light crude for Asia by 80 cents, setting it at a 60-cent premium to the Oman/Dubai benchmark—its lowest level since January 2021. Traders had expected only a 30-cent reduction, making the move a sharp surprise. The cuts mirror a deepening global glut: the IEA forecasts a 2.4M bpd surplus this year, widening toward 4.09M bpd by 2026. Saudi Arabia also lowered prices 60–70 cents across other grades as OPEC+ pauses production hikes into early 2026.

Why It Matters: Lower crude prices are a win for consumers—think cheaper gasoline, jet fuel, and shipping costs—but a strain on oil-producing governments whose budgets rely on high prices (Saudi Arabia needs roughly $91/barrel to break even). For markets, the move signals intensifying competition for Asian buyers, who take ~80% of Saudi seaborne exports. Persistently weak prices (down 12% YoY) could pressure energy stocks and capex plans just as global producers face oversupply.

What to Watch: Whether other OPEC+ members follow with their own price cuts; how Brent and WTI react to the surplus narrative; and whether seasonal demand in Q1 2026 provides any floor. If not, expect more discounts and possibly a return of intra-OPEC market-share battles.
Source: arabnews.com

2. OpenAI Buys Polish Founded Start-up to Tighten Its AI Training Stack

The News: OpenAI has agreed to acquire Neptune, a startup specializing in monitoring and debugging tools used during AI model training. Neptune, which previously partnered with OpenAI on a shared metrics dashboard, will wind down its external services as its tech becomes fully integrated into OpenAI’s internal training workflows. Deal terms were undisclosed, but the acquisition adds to a busy M&A year for OpenAI, which has already purchased io ($6B+), Statsig ($1.1B), and Software Applications Incorporated.

Why It Matters: The move strengthens OpenAI’s training infrastructure at a time when model complexity and training costsare exploding. By bringing Neptune’s tooling in-house, OpenAI gains deeper visibility into model behavior, potentially speeding up development cycles and improving reliability. For developers and enterprises relying on frontier models, better debugging and performance monitoring could mean more stable APIs and faster iteration. It also signals OpenAI’s strategy: acquire the tools it needs to scale rather than build everything from scratch.

What to Watch: How quickly Neptune’s tools appear inside OpenAI’s training and evaluation pipelines; whether other AI labs follow with similar infrastructure buys; and what this means for independent MLOps startups as model training consolidates around a few giants. With OpenAI on a shopping spree, the market for AI infra looks ripe for more rollups.
Source: cnbc.com

3. Global Stocks Rise as Markets Bet on December Fed Rate Cut

The News: Global equities pushed higher Thursday as investors priced in an 89% chance of a Fed rate cut at next week’s December 9–10 meeting—up from 67% a month earlier. The S&P 500 opened +0.24%, the Dow +0.01%, and optimism accelerated after U.S. jobless claims plunged to 191,000, the lowest since September 2022. Initial claims dropped by 27,000, beating expectations and easing fears of labor-market deterioration while still supporting the case for easier policy.

Why It Matters: For markets, the shift toward looser policy has fueled a broad risk rally from megacap tech to small caps as investors wager on a supportive macro backdrop. Abroad, Europe’s FTSE 100 (+0.2%), DAX (+0.8%), and CAC 40 (+0.4%) climbed, while Japan’s Nikkei jumped 2.33%, led by tech. Still, analysts warn sentiment could flip fast if the Fed’s tone turns cautious.

What to Watch: How the Fed pairs its decision with updated economic projections and whether Chair Powell signals one cut or a cutting cycle. Also watch volatility around wage data and services inflation heading into year-end. And if markets want a Santa rally, they’d better hope Powell doesn’t play Grinch.
Source: marketscreener.com

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