Dovish Fed Lifted US Stocks
Key Points
- New York and Boston Fed remarks were read as dovish, boosting near-term easing odds, pressuring short-dated rate futures and supporting risk assets.
- Nvidia's strong quarterly results sparked an early AI-led rally that later reversed after a delayed jobs release muddied Fed-cut odds and amplified intraday volatility.
- S&P Global's U.S. flash PMI showed weaker manufacturing and stronger services, and Germany's HCOB manufacturing at 48.4 briefly nudged 10-year yields lower and weighed on cyclicals.
- Consumer discretionary and healthcare led sector gains while utilities lagged; notable individual moves included CAVA, ADPT and BLLN higher, and ESTC, VEEV and ORCL lower.
Global Market Summary
U.S. benchmarks rose as dovish Fed commentary and easing short-term rate expectations supported risk appetite: the S&P 500 (SPX) gained 1.42%, the Nasdaq Composite (^IXIC) rose 1.49% and the Dow Jones (DJIA) added 1.41%. European markets were mixed, with the FTSE (UKX) up 0.13% and the CAC 40 (FRA40) essentially flat at 0.02% while the DAX (DAX) slipped 0.80% after regional PMI weakness. Asian bourses closed broadly lower, with Shanghai (000001.SS) down 2.45%, the Hang Seng (HSI) down 2.38% and the Nikkei (NKY) down 2.40% as U.S. tech volatility spilled into the region.
Top Movers
Consumer discretionary and healthcare led sector gains, with XLY (+2.52%) and XLV (+2.46%) outperforming while utilities lagged with XLU (+0.19%). Notable individual moves included CAVA (+14.59%), ADPT (+14.39%) and BLLN (+13.21%), while decliners included ESTC (-12.51%), VEEV (-11.09%) and ORCL (-5.66%).
Macro highlights
Remarks from New York Fed President John Williams and Boston Fed President Susan Collins were read as dovish, boosting market odds of near-term easing, pressuring short-dated rate futures and supporting risk assets. S&P Global's U.S. flash PMI showed a slightly weaker-than-expected manufacturing print alongside stronger services, and Germany's HCOB manufacturing PMI flashed 48.4, a mix that briefly nudged 10-year yields lower and weighed on cyclicals.
News that moved markets
Nvidia's strong quarterly results sparked an early rally but the stock and many AI-related names reversed after a delayed jobs release muddied Fed-cut odds, amplifying intraday volatility. FNArena's corporate results monitor and assorted earnings commentary further influenced stock-level swings as traders reassessed valuations across the technology sector. XOMA Royalty completed its acquisition of LAVA Therapeutics N.V., suspending LAVA trading and converting outstanding shares into modest cash consideration plus contingent value rights tied to future milestones. Announced transactions included Merit Financial Advisors' purchase of Blueprint Wealth Advisors, adding about $1.2 billion in assets, and HMP Global's acquisition of Music City SCALE to expand its learning ecosystem.
What to Watch Tomorrow
- US Fed Collins Speech — Nov 22, 04:55 PM | Remarks clarify policy stance and near-term inflation outlook.
- EA ECB President Lagarde Speech — Nov 22, 11:00 AM | Comments clarify ECB policy stance and near-term inflation outlook.
Key Takeaways
- Dovish Fed commentary and easing short-term rate expectations supported risk appetite and lifted U.S. benchmarks, producing outsized gains in major indices.
- Nvidia's earnings initially drove an AI-led rally, but the subsequent jobs release reversed much of the strength and amplified intraday swings across tech and AI names.
- Asian markets closed broadly lower as U.S. tech volatility spilled into the region; European indices were mixed amid regional PMI weakness and cyclicals underperformance.
- XOMA Royalty completed the LAVA acquisition, suspended LAVA trading and converted shares into modest cash consideration plus contingent value rights; other announced deals added assets.
References
- 1. https://www.sec.gov/Archives/edgar/data/0000791908/000119312525290638/d65279d8k.htm
- 2. https://caixabankresearch.com/en/publications/financial-markets-daily-report/21-november-2025
- 3. https://fnarena.com/index.php/2025/11/21/fnarena-corporate-results-monitor-21-11-2025
- 4. https://www.newyorkfed.org/newsevents/speeches/2025/wil251121
- 5. https://www.bostonfed.org/news-and-events/speeches/2025/us-economy-in-a-changing-global-landscape-remarks.aspx
- 6. https://www.reuters.com/world/europe/ecb-president-lagarde-delivers-her-key-note-speech-euro-finance-week-frankfurt-2025-11-21/
- 7. https://tradingeconomics.com/calendar
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