US, Asian Markets Rise on Fed Cut Bets, Earnings, Bitcoin Rebound

December 3, 2025 at 07:11 UTC

5 min read

US and Asian stock market charts rising with Bitcoin price above $90K, reflecting Fed cut optimism

Key Points

Global stock markets, including major US and Asian indexes, showed gains amid growing expectations of a Federal Reserve interest rate cut in December.
Key US economic data releases this week, especially the ADP private payrolls report and the core PCE inflation index, are closely watched for clues on Fed policy direction.
Strong corporate earnings from technology and retail sectors, including Marvell, CrowdStrike, American Eagle, and MongoDB, supported market optimism.
Bitcoin rebounded above $90,000, boosting sentiment in crypto-linked stocks and contributing to risk appetite recovery.

Market Gains Fueled by Fed Rate Cut Expectations and Economic Data Anticipation

Global equity markets experienced a positive session as investors positioned ahead of key US economic data and the Federal Reserve's upcoming policy meeting. US stock indexes, including the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite, closed higher on Tuesday, recovering from a prior selloff. The Dow rose approximately 0.4%, the S&P 500 gained 0.2%, and the Nasdaq increased by 0.6%, with the S&P 500 and Nasdaq reaching multi-week highs. Asian markets were mixed but generally positive, with Tokyo's Nikkei 225 advancing 1.6% and South Korea's Kospi rising 1.2%, driven by strong technology sector performance. Conversely, Chinese markets declined slightly following weaker factory activity data. Investors' focus centered on the Federal Reserve's December 10 meeting, with markets pricing in nearly a 90% probability of a 25 basis point rate cut. This optimism was supported by reports that President Donald Trump's economic adviser Kevin Hassett is the frontrunner to succeed Jerome Powell as Fed Chair in May 2026, potentially signaling a dovish policy stance. However, some Fed officials remain divided on balancing inflation concerns with labor market softness, suggesting the possibility of a 'hawkish cut.' The upcoming ADP private payrolls report and the core Personal Consumption Expenditure (PCE) index, the Fed's preferred inflation gauge, are expected to provide critical insights influencing the central bank's decisions.

Corporate Earnings and Sector Performance Boost Market Sentiment

Robust earnings reports from key companies bolstered investor confidence amid the cautious macroeconomic backdrop. Technology and retail sectors led gains, with semiconductor and AI-related firms showing notable strength. Marvell Technology reported a fiscal third-quarter earnings beat and announced a $3.25 billion acquisition of Celestial AI, a chip startup specializing in optical technology for AI model training, projecting significant future revenue contributions. Despite the acquisition announcement, Marvell's stock experienced some after-hours pressure. CrowdStrike, a cybersecurity firm benefiting from AI-driven demand, posted better-than-expected quarterly results and raised its full-year revenue guidance, reflecting strong subscription growth. American Eagle Outfitters reported record-high quarterly revenues and a strong start to the holiday season, with same-store sales growth and an upward revision of its full-year outlook, leading to a stock surge of over 10% in after-hours trading. MongoDB's cloud software revenue exceeded guidance, driven by its Atlas platform, and the company issued an optimistic full-year revenue forecast, resulting in a significant stock price increase. Other companies such as Credo Technology, Okta, and Salesforce also contributed to the positive earnings momentum. Conversely, some consumer staples and defensive stocks, including Procter & Gamble and Signet Jewelers, reported cautious outlooks, highlighting potential challenges in consumer spending amid a divided US economy where lower-income households face inflationary pressures while wealthier investors benefit from near-record stock market levels.

Bitcoin Recovery Supports Risk Appetite and Crypto-Linked Stocks

Bitcoin rebounded strongly on Tuesday, climbing back above the $90,000 mark after a sharp decline to below $85,000 on Monday, marking its best day since April. This recovery in the leading cryptocurrency helped restore investor appetite for riskier assets, including crypto-related equities. Stocks of companies with significant cryptocurrency exposure, such as Strategy (Michael Saylor's firm), MARA Holdings, Galaxy Digital, Coinbase, and Robinhood, rallied in tandem with Bitcoin's rebound. The cryptocurrency's price movement has been closely correlated with market sentiment and expectations of Federal Reserve policy easing. The renewed strength in Bitcoin and related stocks contributed to the broader market's positive tone, particularly benefiting technology and AI infrastructure companies. Despite recent volatility, the crypto sector's recovery has been a key factor in the ongoing risk-on environment as investors weigh the prospects of a year-end rally amid persistent inflation concerns and stretched valuations.

Bond Yields, Inflation Outlook, and Global Economic Indicators

Treasury yields moderated following recent increases, with the 10-year yield edging down slightly to around 4.08% and the two-year yield easing to approximately 3.51%. This easing in yields helped support equity valuations, particularly for growth-oriented and technology stocks, which are sensitive to interest rate movements. The Organization for Economic Co-operation and Development (OECD) maintained its global GDP growth forecast for 2025 at 3.2%, while revising upward the US growth forecast to 2.0% from 1.8%, and the Eurozone forecast to 1.3% from 1.2%. These revisions reflect resilience in the global economy, supported by strong investment in artificial intelligence and accommodative fiscal and monetary policies. However, inflation remains a concern, with the Eurozone's November Consumer Price Index (CPI) rising 2.2% year-over-year, slightly above expectations, and core CPI steady at 2.4%. Market participants are closely monitoring upcoming US data releases, including manufacturing production, ISM services index, weekly unemployment claims, personal income and spending, and the core PCE price index, to assess inflation trends and labor market conditions ahead of the Federal Reserve's policy decision. The Fed's rate cut expectations have increased sharply, with swaps markets pricing a 98% chance of a 25 basis point cut at the December meeting, up from 30% just a week prior.

Key Takeaways

Markets globally are rallying on strong expectations of a Federal Reserve rate cut in December, supported by positive corporate earnings and a Bitcoin rebound.
Key US economic data this week, especially the ADP jobs report and core PCE inflation, will be pivotal in shaping Fed policy and market direction.
Technology and retail sectors are leading gains, with companies like Marvell, CrowdStrike, and American Eagle reporting robust results and optimistic outlooks.
Despite overall market strength, inflation concerns and consumer spending challenges persist, creating a nuanced economic environment.