Discrepancies in AI valuation and interest rate cut prospects intensify, global stock markets fluctuate, U.S. stock index futures turn positive, and gold, silver, and oil all rise

The U.S. job market is weak, and concerns about the AI bubble persist, leading to fluctuations in global stock markets and boosting safe-haven demand for gold.

On November 7th, after overnight concerns were digested, U.S. stock index futures rose collectively, European stock indices showed mixed results, Asian stocks mostly fell, and spot gold returned to $4,000. The U.S. dollar index rose after experiencing its largest decline since mid-October, while cryptocurrencies continued their downward trend.

The current market is full of divergence; on one hand, there are worries about high AI valuations, while on the other hand, investors remain optimistic about technological advancements. As the earnings season approaches its end, a pattern of buying on dips after sell-offs has begun to emerge. Veteran emerging markets investor Mark Mobius stated:

“If you look at the field of artificial intelligence, you will find a lot of bubbles. We expect that companies heavily investing in AI and pouring trillions of dollars into it will experience a correction. This does not mean that AI will disappear, but the current investment is indeed too high.”

Core market trends:

• U.S. stock index futures rose collectively, with S&P 500 futures up 0.26%, Nasdaq 100 futures up 0.34%, and Dow futures up 0.21%

• The Euro Stoxx 50 index opened up 0.2%, Germany's DAX index rose 0.3%, the UK's FTSE 100 index fell 0.2%, and France's CAC 40 index rose 0.2%

• The Nikkei 225 index fell 1.21%, and the Korea Composite Stock Price Index dropped 1.81%

• The yield on 10-year U.S. Treasury bonds rose 2 basis points to 4.10%

• The U.S. dollar index rose 0.15%, reporting at 99.84

• Spot gold rose 0.7% to $4,005.42 per ounce

• Bitcoin fell 1.17%, and Ethereum fell 0.59%

U.S. stock index futures rose collectively. Overnight, due to weak labor data, combined with market doubts about the return on AI investments and hawkish comments from Federal Reserve officials, the three major U.S. stock indices closed lower. Currently, market sentiment is stabilizing, and U.S. stock index futures are slightly rising.

In addition to the divergence over AI valuations, there is also a significant split in the market regarding the Federal Reserve's interest rate cuts in December. Although private data released on Thursday showed a cooling U.S. labor market, with October's Challenger job cuts reaching the highest level for the same period in over twenty years, several Federal Reserve officials' recent strong statements on inflation have raised doubts among investors about whether a rate cut can occur as scheduled in December.

Cleveland Fed President Loretta Mester stated that the risks of inflation are greater than those of a weak job market. Chicago Fed President Austan Goolsbee expressed unease about rate cuts due to a lack of inflation data during the government shutdown. U.S. Central Bank Governor Michael Barr stated that officials still need to work to control inflation while ensuring a robust labor market. St. Louis Fed President Alberto Musalem warned that the central bank must continue to exert downward pressure on inflation and cautioned that interest rates are nearing a level where they can no longer provide such pressure.

Additionally, the longest government shutdown in U.S. history and the outlook for tariffs have also created uncertainty in the market

Spot gold rose 0.8%, reported at $4008.69 per ounce.