Broadcom Soars on OpenAI Deal; Markets Look to Q3 Bank Earnings

The euro slipped against the U.S. dollar on Monday, with EUR/USD down 0.31% as renewed trade friction between Washington and Beijing boosted demand for the greenback. Political turbulence in France further weighed on the single currency, compounding pressure on the Eurozone outlook.

The U.S. dollar strengthened after President Trump renewed trade tensions by threatening 100% tariffs on Chinese imports starting November 1, in response to China’s new export and port restrictions. He later softened his stance, assuring on Truth Social that relations with China would “be fine” and emphasizing cooperation over conflict.

The euro also faced headwinds from growing political instability in France after President Emmanuel Macron reappointed Sébastien Lecornu as Prime Minister. Opposition leaders Marine Le Pen and Éric Ciotti quickly responded with a no-confidence motion aimed at toppling the newly formed government, adding another layer of uncertainty for investors.

Investors are now turning their attention to upcoming speeches from Federal Reserve Chair Jerome Powell and ECB President Christine Lagarde later this week, seeking clues on the future direction of monetary policy.

On the Eurozone front, key releases this week include Germany’s Harmonized Index of Consumer Prices (HICP) and remarks from ECB board member Mario Cipollone.

In the U.S., the University of Michigan’s Consumer Sentiment Index edged lower to 55.0 from 55.1, slightly above expectations. Inflation expectations for one year dipped to 4.6%, while the five-year outlook held steady at 3.7%, signaling modest progress in inflation perceptions.

Gold prices soared to fresh record highs on Monday, breaking above $4,100 per ounce for the first time as investors sought safety amid renewed U.S.–China trade tensions and growing expectations of U.S. interest rate cuts. Silver also surged to an all-time high, supported by the same bullish momentum.

The precious metal has now gained 56% year-to-date, having crossed the $4,000 mark just last week. A combination of geopolitical uncertainty, monetary easing expectations, and robust central bank demand are the key drivers of the rally.

Tensions between Washington and Beijing resurfaced on Friday after U.S. President Donald Trump reignited trade disputes, ending months of relative calm between the world’s two largest economies.

Meanwhile, traders are pricing in a 97% chance of a 25-basis-point rate cut at the Federal Reserve’s October meeting, and a 100% probability of another cut in December, according to the FedWatch tool. Gold, a non-yielding asset, typically benefits in lower interest rate environments.

Oil prices climbed on Monday after confirmation that U.S. President Donald Trump will meet with Chinese President Xi Jinping later this month, easing fears of renewed trade friction between the world’s two largest economies. The reassurance helped crude benchmarks recover from five-month lows hit late last week.

Both benchmarks had fallen around 4% on Friday, their lowest close since May, after Trump threatened to cancel the planned summit with Xi and to impose steep new tariffs on Chinese imports.

On Monday, U.S. Treasury Secretary Scott Bessent said the meeting remains scheduled to take place in South Korea in late October, noting there had been “substantial communications” between Washington and Beijing over the weekend.

Oil prices, which have been volatile this year amid shifting trade headlines, found support as hopes for renewed dialogue helped stabilize market sentiment.

Further gains in crude were capped by progress toward peace in the Middle East. Palestinian militant group Hamas released the final 20 Israeli hostages on Monday under a U.S.-brokered ceasefire deal.

President Trump called the development the “historic dawn of a new Middle East” following two years of conflict in Gaza. However, traders remained cautious, waiting for confirmation that the ceasefire will hold before factoring it into longer-term oil price expectations.

U.S. stocks closed sharply higher on Monday, lifted by gains in Broadcom and other chipmakers after President Donald Trump adopted a softer stance on trade relations with China, easing investor concerns that rattled markets last week.

AI-related technology stocks led the rebound. Broadcom surged nearly 10% after announcing a partnership with OpenAI to produce the startup’s first in-house artificial intelligence processors. Other semiconductor names also advanced, with Nvidia up 2.8%, Micron Technology gaining more than 6%.

Monday’s rally followed a steep selloff on Friday, when the S&P 500 and Nasdaq posted their biggest weekly losses in months after Trump threatened new 100% tariffs on Chinese goods and potential export controls on U.S. software beginning November 1.

Over the weekend, Trump appeared to dial back his rhetoric, saying relations with China “will all be fine” and emphasizing that the U.S. did not seek to “hurt” Beijing. China responded by blaming Washington for the tensions but stopped short of introducing fresh countermeasures.

Earnings season begins Tuesday, with JPMorgan Chase, Goldman Sachs, Citigroup, and Wells Fargo set to report quarterly results. Investors will be watching closely for signs of how tariffs and trade disruptions are affecting corporate profits.

Due to the ongoing U.S. government shutdown, official economic data releases remain delayed, making corporate earnings a key barometer of economic health.