By Naomi Rovnick
By Naomi Rovnick, global markets correspondent.
What matters in U.S. adn global markets today
Wall Street’s customary Santa rally is nowhere to be found as inflation anxiety and geopolitical tensions dominate the market mood.
brent crude is rallying after U.S. President Donald Trump on Tuesday ordered a “blockade” of sanctioned tankers leaving and entering Venezuela, raising fresh geopolitical tensions at a time of concerns over demand.
Meanwhile,AI fever is red hot in China,an astonishing IPO debut showed.
I’ll get into all of the market-moving news below, but first check out Mike Dolan’s latest column on how Wall Street analysts’s 2025 market calls panned out. Spoiler alert: surprisingly well.
And then listen to the latest episode of the new Morning Bid daily podcast. Subscribe to hear Mike and other Reuters journalists discuss the biggest news in markets and finance seven days a week.
Today’s Market Minute
* U.S. President Donald Trump ordered on Tuesday a “blockade” of all sanctioned oil tankers entering and leaving Venezuela, in Washington’s latest move to increase pressure on Nicolas Maduro’s government.
* Warner Bros Finding’s board could announce a decision as early as Wednesday on Paramount Skydance’s $108.4 billion takeover bid, with the board likely to advise shareholders to vote against the offer, according to sources familiar with the matter.
* British consumer price inflation fell unexpectedly sharply to 3.2% in November, its lowest as March, from 3.6% in October, a day before the Bank of England is widely expected to cut interest rates.
* Britain’s Labor government has two obvious options for boosting a listless economy: an artificial intelligence-driven productivity boom or closer trading ties with the European Union, argues mike Peacock, the former head of communications at the Bank of England.
* China’s steel production in November was the weakest month in nearly two years and will ensure that the world’s biggest producer of the metal will post its lowest annual output since 2018, writes ROI Asia Commodities columnist Clyde Russell.
Inflation Grinch Creeps Up On Wall Street
This time of year frequently enough brings a Santa rally to Wall street, yet the S&P 500 share index is heading for its second week of losses and looks set for a tepid open on Wednesday.
Bullish positioning has already turned extreme, suggesting investors have opened most of their presents already, and cautious trading this week signals fear that Thursday’s U.S. inflation data will be the Grinch that steals whatever is left under the tree.
Futures markets are still pricing at least two rate cuts from the Federal Reserve for 2026, but inflation signals are broadening.
U.S. jobs growth snapped back in November after a decline in the prior month, and Brent crude futures have jumped 2.1% higher on Wednesday to above $60 a barrel after trump’s fresh threats on Venezuela.
U.S. Economic Growth and Inflation in Focus
U.S.real GDP growth is currently tracking at 3.9%, accompanied by an inflation rate of 3%, according to recent data. This robust economic expansion, as measured by the Atlanta Fed’s real-time estimate, is creating potential upward pressure on inflation and may prompt the Federal Reserve to reconsider its monetary policy approach. thursday’s inflation report will be particularly crucial for global markets.
the interplay between strong growth and rising inflation presents a complex challenge for the Fed. While healthy economic expansion is generally positive, sustained inflation above the Fed’s target could necessitate tighter monetary policy, potentially slowing growth.
Today’s Key Events:
* Federal Reserve Bank of New York President John Williams is scheduled to speak, and his remarks will likely be closely watched for insights into the Fed’s thinking on the economy and monetary policy.
* Earnings Reports: Several companies will release their quarterly earnings today, including General Mills (Q2), IntegraFin (FY), Lennar (Q4), and Micron Technology (Q1). These reports will provide a snapshot of corporate performance and potential economic trends.
Opinions expressed are those of the author and do not reflect the views of Reuters News,wich adheres to the Trust Principles.
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