The infoshot to help kick-start your week
AI worries dominate markets again
Another AI related stock sell-off effected most major indexes last week with the S&P, FTSE, Nikkei and Shanghai Stock Exchange all finishing lower.
The head of Alphabet, Sundar Pichai, added to worries about the growth of AI investment. During an interview with the BBC on Tuesday, he said there is some “irrationality” in the AI boom, and that, if the bubble bursts, “no company is going to be immune, including us”.
The next day, the world’s largest company, Nvidia, released their long-awaited earnings report for Q3. Markets initially reacted positively to the press release headlines. They showed sales grew 62% year on year to a higher than expected $57bn and profits just beat expectations to reach $31.9bn. In the initial press release, CEO Jensen Huang said, “Blackwell sales are off the charts, and cloud GPUs are sold out.” However, all Nvidia’s Wednesday share price gains were wiped out on Thursday after analysts digested the full 10-Q (financial report required by the US Securities & Exchange Commission). The report raised further question marks about loans to partners and showed a significant increase in the number of finished goods on their inventory list.
US markets did rebound slightly on Friday after some data that was delayed by the government shutdown showed the US unemployment rate had risen from 4.3% to 4.4% in September, increasing the likelihood of an interest rate cut in December.
Trump has friendly meetings with two contrasting figures
In the White House, Trump hosted Crown Prince Mohammed bin Salman on Wednesday. Prince Mohammed announced Saudi Arabia is planning to increase its US investments from the $600bn pledged during Trump’s visit in May to $900bn. He said they have a “huge demand” for AI chips and there was talk about a deal to transfer nuclear technology to the Gulf state. Nothing was signed and no timeline was given for the spending. To put the figure in perspective, the Saudi’s sovereign wealth fund is worth $900bn. During his first term, Trump announced a $450bn investment deal with the Saudis, but actual trade and investment flows between 2017 and 2020 amounted to less than $300bn.
Trump ended the week with a very different political guest meeting him in the White House, New York mayor-elect Zohran Mamdani. Despite harsh words from both sides in the past such as Trump calling Mamdani a “100% communist lunatic” and Mamdani labelling Trump a “despot”, the two appeared to get on amicably as they bonded over how to tackle New York’s, and the wider American “affordability” crisis.
Nikkei falls 2.3% as Japan-China tensions turn into a trade war
On top of the global AI investment boom worries, the Nikkei was also hit by escalating tensions between Japan and China. When speaking to parliament a few weeks ago, new Prime Minister Sanae Takaichi said Chinese action against Taiwan could prompt a Japanese military response. The statement immediately raised objections from Beijing that have since developed from a war of words to a trade war over the last couple of weeks. Ten days ago, China issued a no-travel advisory for Japan, targeting their tourism sector (7.5 million Chinese tourists visited Japan between January to September this year) and last week they banned Japanese seafood. Diplomats from both sides met in Beijing on Tuesday but the meeting appeared to do little to ease tensions.
On Friday, Takaichi unveiled her ¥21.3tn ($135.4bn) stimulus package to increase growth and protect people from higher prices. It’s the biggest Japanese stimulus package since Covid. Takaichi will be hoping it can offset the damage done by Trump’s tariffs, and boost investment in key areas like AI, semiconductors, defence and shipbuilding.
UK inflation drops to 3.6% ahead of Wednesday’s Budget
The latest UK inflation data from the Office for National Statistics (ONS) showed inflation fell from 3.8% to 3.6% in October. Rachel Reeves welcomed the news before adding she was, “determined to do more to bring prices down”. The inflation decrease increases the likelihood of an interest rate cut in December.
Coming Up:
- UK Autumn Budget Statement, Wednesday 26 November 2025 at 10:00
- US Jobless Claims, Wednesday 26 November 2025 at 13:30
- German CPI, Friday 28 November at 13:00
Notice:
For regulated financial advisers and investment professionals only, Copia does not provide financial advice, and the contents of this document should not be taken as such. The performance of each asset class is represented by certain Exchange Traded Funds available to UK investors and expressed in GBP terms selected by Copia Capital Management to represent that asset class, as reported at previous Thursday 4:30pm UK close. Reference to a particular asset class does not represent a recommendation to seek exposure to that asset class. This information is included for comparison purposes for the period stated but is not an indicator of potential maximum loss for other periods or in the future.
