Markets Brace for Fed Decision and Earnings as Oil Keeps Investors Cautious

Asian shares fell and Europe was set to open higher on Monday as oil prices and inflation worries framed a week of Fed policy and heavy US earnings. Chip volatility, AI financing and gold below $4,000 added to the picture.

Maz Vantage ·

Markets start the week cautious

Asian equities were mostly lower on Monday, tracking a negative Friday on Wall Street, as higher oil prices, global inflation worries and uncertainty around the Middle East conflict weighed on sentiment, with traders also wary ahead of upcoming interest-rate decisions (Nasdaq/RTTNews). Indian shares opened lower on the same mix of elevated oil prices and caution before the Federal Reserve's decision, due later in the week (Nasdaq/RTTNews). European stocks were expected to open higher as oil prices retreated, with attention on several central bank decisions including the Fed's meeting (Nasdaq/RTTNews).

Wall Street: earnings season intensifies

More than a third of S&P 500 companies are due to report earnings this week. One strategist quoted by MarketWatch described sentiment as "cautious to negative" and said it "could be a tricky week" (MarketWatch). Combined with the Fed meeting, this makes the coming days a test of how investors weigh corporate results against inflation and rate expectations. For background, the Fed published the minutes of its September 15-16 meeting earlier this month (Federal Reserve).

Technology and AI

Chip shares have been volatile: the PHLX Semiconductor Index fell 6.7% on October 22, its worst day since June 23 (Nasdaq). Separately, Nvidia's CFO has framed the revenue opportunity per gigawatt of AI capacity as roughly $18 billion with Hopper, $25 billion with Blackwell and $40 billion with the upcoming Vera Rubin generation (Nasdaq). The scale of AI spending also shows in financing: Elon Musk said SpaceX secured a $40 billion debt deal for its growing AI chip-rental business (MarketWatch), and Anthropic said it could spend up to $750 billion on AI compute, of which $450 billion is already committed to contracts that cannot be cancelled (Nasdaq).

Commodities

Oil is central to the market mood. Investing.com's technical commentary notes WTI crude consolidating below $103.50 resistance (Investing.com) and Brent testing cloud support after what it calls a parabolic top (Investing.com). Gold slipped below $4,000 per ounce (Investing.com).

Trade and corporate investment

The White House will ease tariffs on some Canadian goods from October 30, including certain machinery, while placing tariffs on others (BBC). Volkswagen plans a $4 billion Audi SUV factory in the United States, creating 4,500 jobs in Georgia, even as it cuts jobs at home (The Guardian).

What to watch

The Fed's decision later this week, the first wave of big-company earnings, and the direction of oil prices are the main drivers flagged in today's coverage.

Sources