Launch Pad

Clear as mud. After contending with a government shutdown, agencies in the U.S. are releasing long-awaited economic data. First up were the jobs numbers which showed job growth in November, with NFP increasing by 64,000, slightly exceeding expectations. The unemployment rate, however, rose to 4.6%, which was higher than forecast and reinforces signs of a cooling labour market. The BLS also reported that payrolls fell by 105,000 in October, a decline economists largely anticipated after September’s unexpected gain. The retail numbers also painted a mixed picture, with U.S. retail sales essentially flat in October, as declines in motor vehicle purchases and lower gasoline receipts offset gains in other areas. While overall sales missed expectations, spending excluding autos and gas rose 0.5%, and the closely watched control-group measure jumped 0.8%, the strongest increase in four months, signaling firmer underlying consumer demand heading into the holiday season. Gains were led by department stores and online retailers, while restaurant spending slipped, highlighting a consumer environment supported mainly by higher-income households amid ongoing cost-of-living pressures. 

M&A activity rebounded this year, with deals totaling $4.5 trillion, up ~40% from last year. This marks the second-biggest deal year on record as companies pursued mega-deals amid easing interest rates and a friendlier regulatory climate. The boom included a record number of transactions above $30 billion, including Union Pacific’s acquisition of Norfolk Southern, Anglo American’s takeover of Teck Resources, and Netflix’s bid for Warner Bros. No surprise, tech and AI-driven deals also played an outsized role this year, helped by strong equity markets, Wall Street financing, and capital from the Middle East. Still, concerns around AI valuations, geopolitical tensions, and trade risks could trigger market volatility, potentially slowing deal momentum in the months ahead. 

Investors are becoming more optimistic that EM carry trades will continue to perform well into next year after delivering their strongest returns since 2009, helped by low currency volatility, a weakening U.S. dollar, and wide interest-rate differentials between developed and emerging economies. Central banks in developed markets, including the Fed, are widely expected to keep borrowing costs relatively low, supporting demand for higher-yielding emerging-market currencies like the Brazilian real, Colombian peso, South African rand, and Mexican peso. While lower volatility and easing U.S. monetary policy will support the strategy, some investors remain cautious that crowded trades, potential spikes in currency swings, or unexpected shifts in U.S. growth or inflation could impact returns. 

Home sales across Canada declined in November, falling 10.7% year over year and 0.6% lower from October. The national average sale price dropped 2% to $682,219, while the MLS Home Price Index fell 3.7% from a year earlier. Although the BoC’s decision to hold rates at 2.25% is seen by some as a green light for activity to pick up next year, others argue buyers remain held back by affordability pressures, economic uncertainty, and depleted savings. Analysts expect prices to stay under pressure in markets such as B.C. and Ontario, with modest gains elsewhere. And while pent-up demand could support gradual improvement in sales, many expect any meaningful rebound to be slow and uneven and something that will not materialize until late next year. 

Who needs sleep anyways? Stock markets in the U.S. are moving closer to near-round-the-clock weekday trading, with exchanges such as Nasdaq seeking approval to trade up to 23 hours a day and the NYSE laying similar groundwork. While that sounds great for those night owls out there, many major Wall Street banks remain cautious. While those in favour argue extended hours would benefit global investors by allowing faster reactions to news outside U.S. market times, banks and market experts warn of significant costs, thin overnight liquidity, wider spreads, higher volatility, and complex risk-management challenges that could require tens of billions of dollars in new investment with uncertain near-term returns. Although some firms see long-term demand and are preparing to participate, many institutional players expect adoption to be gradual, with meaningful liquidity and profitability likely emerging only several years after launch.  

That’s one way to boost your population. China is set to impose a new 13% sales tax on condoms, birth control pills, and contraceptive devices starting next year as part of broader efforts to counter declining birth rates, an aging population, and a shrinking workforce. The policy accompanies pro-natal measures such as tax exemptions for childcare and eldercare services, longer maternity leave, proposed paid paternity leave, and annual cash allowances of about $500 per child. The measures come amid high child-care costs, a weak job market, and historically low fertility, with births roughly half of what they were a decade ago. The new tax changes are more symbolic, with many doubting it will materially affect fertility trends while public health experts warn it could have unintended consequences. 

Copper inched lower as a risk-off mood set in across markets ahead of U.S. jobs data that could steer the debate about the extent of future interest-rate cuts. Copper has rallied by about a third this year, setting a series of records and on course for its strongest annual showing since 2009. The surge has been underpinned by supply snarls at some of the world’s biggest mines, as well as expectations that the Trump administration may impose a tariff on refined metal. The trade concerns have drawn copper inventories into the world’s biggest economy, tightening conditions elsewhere. Goldman Sachs just upgraded its copper-price forecast for next year, saying that potential U.S. curbs on imports are seen as less likely in the first half, allowing a window for shipments ahead of any restriction.