MPC Morning Call 9th December 2025 – Stocks head Lower as rate cut optimism already priced in
Stocks were lower overnight as investors realised any rate cut or dovish fed statement is more than fully priced in, limiting upside catalyst
WATCH ON YOUTUBE MPC Morning Call 9 th December 2025 – Stocks head Lower as rate cut optimism already priced in Stocks were lower overnight as investors realised any rate cut or dovish fed statement is more than fully priced in, limiting upside catalyst Investor optimism grew early this week ahead of the Federal Reserve’s policy decision, with markets largely expecting an interest rate cut following signs of softer inflation and weakening labor conditions. The core PCE index—one of the Fed’s key inflation gauges—came in cooler than expected, supporting the case for easier monetary policy. Analysts believe the main focus will be the Fed’s outlook for 2026, as futures data indicate nearly an 88% chance of a rate cut announcement. Corporate developments also influenced sentiment, with upcoming earnings from major companies like Broadcom, Oracle, and Adobe. Microsoft’s potential chip design shift from Marvell to Broadcom and IBM’s $11 billion acquisition of Confluent attracted attention. Meanwhile, Netflix’s proposed $72 billion merger with Warner Bros Discovery faced complications after Paramount launched a rival bid, raising competitive and regulatory concerns. On the commodities front, oil prices fell about 2% after Iraq restored output at a key oilfield, contributing to global supply. Broader geopolitical factors—including slow progress in Ukraine peace talks and potential new Western sanctions on Russian oil—added uncertainty to the energy outlook. Analysts cautioned that any peace deal could sharply increase Russian exports and pressure prices, while ongoing supply constraints or infrastructure damage could have the opposite effect. The dollar rose against the yen after news of the earthquake in Japan. Depending on the extent of the earthquake’s damage, the Bank of Japan could delay an expected rate hike next week, analysts said. Government Bond Yields Commodities, Energy & FX ASX Overnight: SPI 86609 (-0.27%) The Day Ahead: While all eyes will be on the RBA’s interest rate decision at 2.30pm (AEDT), there’s still data coming out on Tuesday, such as the NAB business survey at 11.30am (AEDT). Corporate news: Nothing of major note
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