Turns out the tariff monster is more bark than bite, as prices didn’t explode, and the economy’s still jogging.

But the sentiment is shifting: big companies stopped labor hoarding, energy bills are pinching wallets, and global investment is on a slow drip.

Here’s where the markets will go this week.

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The Big Picture

Trade

When the U.S. Consumer Sneezes, Global Manufacturing Catches a Cold

October’s manufacturing data painted a clear picture: global factories are idling while waiting for U.S. demand to pick back up.

From Europe to Asia, new export orders tied to American consumers have softened, forcing production lines to scale back.

The world’s biggest suppliers are discovering what happens when the U.S. slows its spending rhythm—everything else hums quieter, too.

A Supply Chain Built on Uncertainty

Weaker American orders have left foreign producers facing lower output, shrinking margins, and thinner pipelines.

For the U.S., that dynamic loops right back into the economy.

A slowdown abroad means fewer imported goods, lighter port traffic, and declining demand for raw materials that feed American logistics, shipping, and manufacturing sectors.

The Ripple Effect at Home

U.S. economic strength still rests on the willingness of households and companies to keep buying.

But if weak factory data abroad signals a deeper global cooling, the pressure shifts inward onto American industrial output, corporate investment, and retail inventories.

The global slowdown isn’t just an overseas headline anymore; it’s a subtle warning that the world’s supply chain heartbeat still depends on how fast the U.S. chooses to spend.

Monetary Policy

The Great Rounding Era: America’s Newest Inflation Problem Comes in Cents

With the U.S. penny now retired from production, retailers across the country are scrambling to adapt.

Cash registers are being recalibrated, store policies rewritten, and transactions rounded as the nation’s smallest coin vanishes faster than expected.

For businesses that rely heavily on cash payments, the difference of a cent suddenly adds up to real dollars.

Counting Pennies That Don’t Exist

The transition is revealing how deeply everyday commerce relies on small changes.

From gas stations to grocery chains, stores are rounding totals down to keep customers happy, cutting into already thin margins.

This move could trim billions in minting costs for the government.

Still, for high-volume retailers, those tiny round-downs represent a hidden inflationary cost that eats into profits one nickel at a time.

A New Era of Rounding Economics

While electronic payments escape the chaos, the cash economy is entering its own period of adjustment.

Legal differences across states, patchy guidance, and outdated registers are complicating the rollout.

What started as a minor coin-saving initiative is now becoming a real-time stress test for the flexibility of American retail.

The penny may be gone, but the reckoning over how to price things without it has only just begun.

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Fiscal Policy

The Coffee Break That’s Costing Billions

The U.S. government’s record-breaking shutdown has officially crossed into historic territory, dragging into its 35th day and showing no signs of relief.

Federal agencies have hit pause on critical programs, and the ripple effects are spilling into homes, classrooms, and airports.

What began as a political standoff is now quietly turning into a macroeconomic drain.

America’s Slow Burn of Lost Productivity

With millions of federal workers off the clock, contracts frozen, and assistance programs stalled, the economy is losing billions in output each week.

Missed paychecks mean lower spending, delayed projects mean slower growth, and the longer Washington stays dark, the harder it becomes to flip the switch back on.

Sectors from food services to healthcare are already feeling the squeeze as delayed funding and reduced demand tighten margins.

The Hidden Cost of Doing Nothing

Each additional week of gridlock compounds the damage.

Consumer confidence dips, businesses hesitate to hire, and the next jobs report may show the hangover spreading beyond government payrolls.

A country that runs on credit, consumption, and confidence can’t afford too many days off, and this forced vacation is starting to look like a very expensive one.

Metrics to Watch

• Tariff Effective Rate, Not the Headline
  Track Treasury customs receipts and company remarks on duty bills. If the cash take stays light, the real bite is smaller, and inflation pressure cooler.
  

• Who’s Eating Costs vs. Passing Them On
  Listen for gross vs. operating margin talk at retailers/autos. If “we absorbed” stays the line, prices hold, but profits don’t.
  

• Layoff Signals > Official Stats
  Watch company 8-Ks, press releases, and staffing-firm commentary. An uptick in cuts without new hiring hints keeps wage heat easing and sentiment jumpy.
  

• Power-Bill Guidance
  Utility rate cases and management color on electricity costs (especially in data-center corridors) are a live tell for small-biz margins and consumer bills.
  

• China Demand Breadcrumbs
  New orders/backlog chatter from multinationals selling into China. If backlogs thin and export orders wobble, Q4 guidance will, too.

Market Movers

🛍️ Retail & Autos: Stealth Winners (For Now)
If firms keep swallowing part of tariffs, sticker shock stays muted, supportive for volumes, tricky for margins. Operators with cost discipline benefit.

🚛 Logistics, FTZs, and Warehouse Plays
Bonded warehouses and reroutes to Vietnam/Mexico/Turkey favor operators enabling duty-dodging and smarter inventory. Less love for pure just-in-time.

🔌 Utilities vs. Energy-Hungry Businesses
Grid and rate pressures can support regulated utilities with allowed recovery while cafes, grocers, and power-intense manufacturers feel the squeeze.

🥇 Gold + Global Megacaps on Dollar Drift
If cuts at the Fed persist, a softer dollar helps commodities and U.S. brands with big overseas sales, FX becomes a tailwind instead of a headwind.

🤝 U.S.–China Détente-ish Beneficiaries
Soy exporters, select shippers, and rare-earth users get marginal relief, but it’s a truce, not a treaty. Keep headline risk in the model.

🏗️ Onshore Capex > Offshore FDI
U.S. chips/data centers stay funded; EM manufacturers tied to new FDI lag. Domestic capex vendors, builders, and installers may keep winning.

Market Impacts

Equities: Futures are basically flat to start November (call it +0.1%-ish), which says grind, not gallop.

October was kind to the tape that AI momentum and  >80% EPS beats will do, and seasonality usually gives November a tailwind. 

The shutdown muddies the data, and SCOTUS chatter on tariff legality adds headline spice.

You should keep your A-team (cash-rich compounding tech and steady growers), trim the obvious stretch, and buy dips on boring red days, not euphoric green ones.

Bonds: The 10-year is hanging near ~4.10% with the 2-year mid-3.5s after a quarter-point Fed cut and some hawkish dissent. With official data patchy, speeches matter extra.

Sweet spot remains the short-to-belly (2–5 years) for income, but keep a small umbrella of long duration for uh-oh moments.

Currencies: The dollar’s firmed, especially versus the yen, after the BOJ underwhelmed hawks. If Fed-cut odds fade further, the buck stays supported, and a friendlier U.S.–China relationship or softer U.S. prints could nudge it sideways.

Euro gets a cautious bid on better surveys; yen strength likely needs a real BOJ turn, not just stern looks.

Commodities: Gold cooled ~1% on cut-odds wobble but is still riding a multi-month uptrend, so treat it like insurance: small, boring, useful.

Oil: OPEC+ is doing a tiny add in Dec, pause in Q1 to avoid a glut, with Russia sanctions adding a supply wild card.

That mix argues for a range with a floor, as refiners and transport may remain steadier than high-beta drillers until demand re-accelerates.

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Key Indicators to Watch

• Durable Goods Orders (Mon, 8:30 a.m. ET) – Big-ticket factory demand. Soft = bond-friendly and defensive; hot = cyclicals smile. May be delayed

• S&P Case-Shiller 20-City Home Prices (Tue, 9:00 a.m.) – Price momentum vs. affordability. Firmer prices help homebuilder sentiment; too hot crimps buyers.

• Consumer Confidence (Tue, 10:00 a.m.) – Wallet mood check. Rebound = retail/travel tailwind; slippage flags caution into holidays.

• Pending Home Sales (Wed, 10:00 a.m.) – Next month’s closings preview. Stable-to-up = housing has a pulse; down = rates/budgets still biting. May be delayed

• FOMC Decision + Powell Presser (Wed, 2:00 & 2:30 p.m.) – Another trim is on the table but not guaranteed; tone matters more than the move. “Measured and patient” supports the grind-higher trade; hawkish hints lift yields and cool high-growth.

Shutdown note: Some releases can slip. The Fed will still talk—so speeches and pressers carry extra weight.

Everything Else

• Tariffs are starting to leak into checkout lines just in time for holiday shopping as early stockpiles fade and retailers hint at price creep.

• Washington just trimmed its fentanyl levy on China to 10% and nodded to a rare-earths détente, a cool-down, not a cuddle.

• China’s factory pulse stayed positive but eased as the private PMI slipped, suggesting meh demand and continued export dodging around tariffs.

• Treasury’s Scott Bessent says high rates may have pushed housing into a recession-ish phase, with lower-end buyers taking the brunt.

• The Fed cut, but Powell’s “maybe that’s it” tone, and a data blackout, keeps December murky as the Fed in fog narrative lingers.