Trading session preview: inflation softness, central bank moves and corporate drama set tone
Markets start the session on cautious footing after a week of mixed macro data, big corporate headlines and fresh central bank moves. Micron Technology (NASDAQ:MU) surged on a bullish profit outlook, while U.S. core CPI slowed to 2.6 percent year on year, the weakest since March 2021. That soft print and revised payrolls from a 43 day government shutdown are reshaping short term rate cut expectations. Globally, the Bank of Japan tightened policy while the Bank of England eased further. Energy flows and major deals add near term volatility with longer term implications for supply chains and corporate strategy.
Market snapshot and immediate drivers
Equity markets rallied late in the week as Micron Technology (NASDAQ:MU) jumped roughly 16 percent on a stronger than expected profit forecast. That move lifted market sentiment and helped U.S. indexes finish higher on Thursday. The rally matters now because it can prompt position adjustments at the start of the trading week and influence sector rotation into semiconductors and tech names.
However, the broader macro picture remains noisy. Core U.S. consumer price inflation for November printed 2.6 percent year on year. That is the slowest pace since March 2021. This softer reading increased market odds for Federal Reserve rate cuts earlier next year. Yet most economists have questioned the accuracy of the print because the 43 day government shutdown forced the Bureau of Labor Statistics to change collection methods. Traders will weigh the headline reaction against these caveats.
Employment data and policy uncertainty
November payrolls showed 64,000 jobs added, above consensus that expected a weaker print following October’s large drop. The unemployment rate rose to 4.6 percent, a four year high. Both figures matter for the immediate Fed narrative. Stronger employment would argue for a more gradual easing path, while higher unemployment could support earlier rate relief.
Methodology changes tied to the government shutdown complicate interpretation. The BLS adjustments introduce uncertainty about data comparability. As a result, market participants may place more weight on a series of upcoming releases rather than any single report. That makes the coming sessions likely to be driven by headlines and revisions as much as by fresh economic reads.
Central bank moves around the world
Policy divergence increased during the week. The Bank of Japan raised its policy rate by 25 basis points to 0.75 percent, its highest in thirty years. The move signals a shift away from ultra easy conditions in Japan. Still, the yen weakened and commentators warned that modest tightening may not be enough to pull the currency out of intervention risk territory. Currency markets will be sensitive to follow through from Tokyo.
In contrast, the Bank of England cut its policy rate to 3.75 percent from 4.0 percent, marking the sixth cut since August 2024. The BoE noted weaker inflation and what looks like stagnation in growth. Markets will watch whether the BoE has more to do if real rates continue to tighten. The European Central Bank left its main rate at 2.0 percent and suggested its easing cycle is likely over. This mix of moves means global policy directions are uneven and will influence capital flows across regions.
Energy, commodities and geopolitical headlines
Brent crude futures tumbled nearly 3 percent to trade below 59 dollars a barrel on Tuesday, their weakest since early 2021. That drop reflected growing optimism about a possible peace deal in Ukraine and expectations of rising global supply. Prices briefly rebounded after a statement that President Donald Trump ordered a blockade of sanctioned oil tankers into and out of Venezuela. Oil traded lower again by Friday.
Beyond geopolitics, the more enduring driver appears to be supply. Reports flagged a pickup in global oil supplies both on land and at sea. For markets, that suggests the near term price trajectory may hinge more on logistics and inventory developments than on headline risk alone. Regional demand patterns also matter. Asia looks set to import less U.S. crude, coal and liquefied natural gas this year, which will affect flows into key hubs and pressure benchmark pricing.
Japan reduced fossil fuel generation to its lowest level in over a decade as nuclear output recovered in 2025. That moves the regional energy equation and could change Asian demand for LNG and coal going forward.
Corporate dealmaking and market structure
Mergers and strategic shifts kept deal news at the front of markets. Warner Bros Discovery (NASDAQ:WBD) rejected a 108.4 billion dollar hostile proposal from Paramount Global (NASDAQ:PARA). That rebuff underscores how pricing, control and governance battles can reshuffle media sector valuations and strategic priorities. Separately, a 6 billion dollar all stock deal was announced combining Trump Media with TAE Technologies, backed by Google linked interests. Deals of this size can affect small cap liquidity and investor attention.
ByteDance moved to sign binding agreements to transfer control of U.S. TikTok operations to a group of investors including Oracle (NYSE:ORCL). That development could ease regulatory pressure and alter the competitive field in social media and ad spending. In energy corporate news, BP (NYSE:BP) surprised markets by appointing Meg O’Neill to replace Murray Auchincloss as chief executive. The choice places BP at a strategic crossroads and renews speculation about whether the company will expand organically, pursue acquisitions or become a takeover target.
What to watch in the session ahead includes reactions to the CPI and payroll caveats, follow through in semiconductor stocks after Micron’s forecast, and swings in oil prices driven by supply updates and geopolitical headlines. Central bank statements and any clarification on BLS methodology will also be market moving. Volatility may be elevated early in the week as traders assess which signals carry through into positioning for 2026.
All commentary here is informational and not investment advice. Markets can respond quickly to new information and traders should watch primary data releases and central bank commentary for updates.
