Headline: Markets Rally on Easing Shutdown Risks as UBS Sees S&P 7,500 by 2026; Yen Slides and Crypto Staking Gains Momentum
U.S. equities advanced as investors bet on progress toward averting a federal shutdown, while the yen weakened amid expectations that Japan could tolerate looser monetary conditions. Alongside the risk-on tone, a debate resurfaced over how much dollar-hedging flows have amplified Wall Street’s outperformance versus global peers.
UBS now projects the S&P 500 could climb to 7,500 by 2026, emphasizing earnings growth rather than multiple expansion as the primary driver. The bank expects the U.S. to continue leading global equities, with mega-cap technology still anchoring returns and a broader set of sectors joining the rally later next year. Meanwhile, macro currents remain mixed: Nomura flagged only tentative signs of improvement in China’s inflation data, sticking with near-zero CPI and a -2.5% PPI forecast as weak demand lingers despite reform efforts.
Policy and market dynamics are intersecting on multiple fronts. Roughly $4 billion in SNAP food assistance could be at risk amid shutdown negotiations, underscoring the fiscal sensitivity of household spending. In credit, consumers continue to weigh value and access: one popular cash-back card offers 1.5% back and a 0% introductory APR with a welcome bonus, while a no-annual-fee alternative targets credit building. In digital assets, regulators have effectively greenlit staking yields for Ethereum and Solana, with indicative APYs ranging from about 1.8% to 7%, a shift that could accelerate institutional adoption and give traditional issuers clearer rules of engagement. In equities tied to AI, investors are watching valuation risk closely as headline growth at firms like Palantir meets high-profile bearish positioning from noted traders.
Key Points: – Stocks rose on optimism a U.S. government shutdown can be avoided; the yen weakened on looser policy expectations in Japan. – UBS sees the S&P 500 reaching 7,500 by 2026, led by earnings growth and a gradual broadening beyond mega-cap tech. – China’s recovery remains fragile, with Nomura maintaining near-zero CPI and -2.5% PPI forecasts due to soft demand. – About $4 billion in SNAP benefits face uncertainty amid ongoing budget negotiations. – Consumers weigh card choices: a 1.5% cash-back, 0% intro APR card with a bonus versus a no-fee option focused on building credit. – Regulatory clarity on Ethereum and Solana staking yields (around 1.8%–7% APY) could speed institutional participation in crypto.
