Global Risk Monitor: Week in Review – Nov 28

Key Issues - Precious metals, particularly silver, showed significant momentum with a 13% weekly increase and over 90% year-to-date gain, driven by inflation concerns and demand for safe-haven assets [3][5][12] - The European banking sector demonstrated strength, with Eurozone banks rallying approximately 5% for the week and nearly 70% higher year-to-date, outperforming major tech stocks [4][5][12] - A major decline in market volatility, with the VIX dropping to 16, indicated a stronger risk appetite among investors [11][5] Global Markets Summary - U.S. equities experienced broad gains, with the S&P 500 rising 3.73% and small caps outperforming large caps, reflecting a shift towards risk-on sentiment [2][6] - Technology shares rebounded strongly, contributing to the overall positive market performance [2] - The probability of a 25 basis points rate cut by the Federal Reserve at the December 10th meeting is now at 86% [2][6] United States - Economic indicators showed mixed results, with retail sales up 0.2% for September, below expectations, while jobless claims fell to 216,000, the lowest since April [6] - The Fed Beige Book indicated a slight decline in employment and weakened consumer spending, suggesting cautious economic sentiment [6] Europe - Eurozone banks' performance was a highlight, with a year-to-date increase of nearly 70% when accounting for currency gains, driven by strong capital positions and improved sentiment towards European financials [4][5][6] - Major indices in Europe also posted gains, with the STOXX Europe 600 up 2.35% [6] Japan - Japanese markets rallied, supported by dovish signals regarding global monetary policy and a rebound in tech shares, with the Nikkei rising 3.35% [7][13] China - Chinese equity benchmarks advanced, although industrial profits fell 5.5% year-over-year, indicating ongoing structural challenges in manufacturing and real estate [8] Commodities - Silver's price surged to $56.41 per ounce, reflecting a 12.89% increase for the week and a 90.52% year-to-date gain, significantly outperforming Bitcoin [30] - Gold also saw a rise, with prices reaching $4,217.81 per ounce, up 3.79% for the week [30] Market Volatility Trends - The VIX's drop to 16, down 7 points in one week, is a significant indicator of changing risk sentiment in global markets [11][5] Outlook - Market participants are closely watching for potential Federal Reserve rate cuts and Eurozone inflation readings, which could influence future monetary policy [16]