19 December 2025
US stocks rose on Thursday, following inflation data and led by a rebound in technology shares. The S&P 500 gained 0.8%.
US Treasuries rose as softer-than-expected November CPI inflation data supported investor expectations of Fed rate cuts next year. 10-year yields fell 3bp to 4.12%.
European stocks rose on Thursday as US inflation slowed unexpectedly in November. The Euro Stoxx 50 closed 1.1% higher. The German DAX gained 1.0% while the French CAC rose 0.8%. In the UK, the FTSE 100 ended 0.6% higher.
European government bonds mostly rose. 10-year German and French bond yields edged 1bp lower to 2.85% and 3.56% respectively. In the UK, 10-year gilt yields closed at 4.48% (+1bp).
Asian stock markets ended mostly lower on Thursday, tracking overnight US market losses, amid renewed investor concerns over leading AI companies’ lofty valuations and high investment. Japan’s Nikkei 225 closed down 1.0%, as the Bank of Japan started its two-day meeting, while Korea’s Kospi fell 1.5%. Meanwhile, China’s Shanghai Composite and Hong Kong’s Hang Seng edged up 0.2% and 0.1% respectively. India’s Sensex ended 0.1% lower.
Crude oil prices rose on Thursday. WTI crude for January delivery settled 0.4% higher at USD56.2 a barrel.
The European Central Bank kept its policy rates on hold for a fourth consecutive meeting, amid still sticky services inflation and resilient growth.
In the UK, the Bank of England cut its policy rate by 25bp to 3.75%, as expected, with disinflation seen as being more "established", but the Governor signalled caution on further cuts.
In the US, inflation surprised notably to the downside, coming out at 2.7% yoy in November, from 3.0% yoy in October, but the government shutdown means that the data may have been less reliable than normal.
Japan’s core CPI inflation (excl. fresh food) stayed at 3.0% yoy for a second month, signalling sustained price pressure. Services sector inflation has been stable recently.
Mexico’s central bank lowered its policy rate by another 25bp to 7.00%, but disappointing core inflation data raise the risk of a pause in the near-term.
The Bank of Japan (BoJ) is expected to raise its policy rate by 25bp to 0.75% amid recent growth-inflation data. The market focus will likely be on how the BoJ communicates the pace of rate hikes ahead and the terminal rate level.
We’re not trying to sell you any products or services, we’re just sharing information. This information isn’t tailored for you. It’s important you consider a range of factors when making investment decisions, and if you need help, speak to a financial adviser.
As with all investments, historical data shouldn’t be taken as an indication of future performance. We can’t be held responsible for any financial decisions you make because of this information. Investing comes with risks, and there’s a chance you might not get back as much as you put in.
This document provides you with information about markets or economic events. We use publicly available information, which we believe is reliable but we haven’t verified the information so we can’t guarantee its accuracy.
This document belongs to HSBC. You shouldn’t copy, store or share any information in it unless you have written permission from us.
We’ll never share this document in a country where it’s illegal.
This document is prepared by, or on behalf of, HSBC UK Bank Plc, which is owned by HSBC Holdings plc. HSBC’s corporate address is 1 Centenary Square, Birmingham BI IHQ United Kingdom. HSBC UK is governed by the laws of England and Wales. We’re authorised by the Prudential Regulation Authority (PRA) and regulated by the Financial Conduct Authority (FCA) and the PRA. Our firm reference number is 765112 and our company registration number is 9928412.
