The University of Michigan’s consumer sentiment index rose to 51.0 in early November 2026, up from 48.0 in October and comfortably above market expectations of 48.0. Modest gains across several components, including expectations for personal finances and business conditions, were driven primarily by independent voters. Sentiment improved among lower- and middle-wealth households but fell 5% among consumers with the largest stock portfolios, following a relatively turbulent period in equity markets. Consumer comments also revealed growing concerns about a potential AI bubble, although these remained secondary to persistent cost-of-living pressures. Despite November’s improvement, overall sentiment remains 10% below its February level. Inflation expectations offered a more encouraging signal: year-ahead expectations declined to 4.3% from 4.7% in October, while long-run expectations edged down to 3.4% from 3.5%.

Next week, the AI trade is likely to remain in the spotlight, with investors assessing whether last week's rotation out of technology stocks will continue or whether enthusiasm for the sector will return following the sell-off triggered by the Democrats' sweep of the US Congress. In the US, CPI and PPI reports will provide fresh insights into the inflation outlook and help shape expectations for the Fed's next policy move, with another 25bps rate hike currently priced in for December. A series of appearances by Fed policymakers will also be closely scrutinised for further clues on the interest rate outlook. Elsewhere, investors will focus on China's inflation and trade figures, Japan's PPI, inflation data from India, Brazil and Mexico, trade figures for Germany and the UK, and GDP releases from the UK, Russia, Poland and the Philippines.

The S&P 500 increased near 1% and the Nasdaq gained almost 2% on Friday while the Dow was near flat The moves followed a sharp sell-off in the previous session, which marked the market's worst one-day losses since April 2025 and pushed the Nasdaq into correction territory. Concerns that a Democratic sweep of Congress could lead to tighter AI industry regulation and lower investment in the sector weighed on sentiment, prompting investors to rotate out of tech and AI-related stocks and triggering a broader risk-off mood. However, dip-buying emerged on Friday and the sell-off paused, particularly across major chipmakers. Technology was the top performing sector while consumer staples underperformed. Nvidia added over 3%, Broadcom rose 1%, Micron surged over 6% and AMD soared about 10%, while Tesla added near 5%. Meanwhile, the jobs report pointed to a robust labour market. On the week, the S&P 500 is down nearly 3%, the Dow off 1% and the Nasdaq is lower by around 5%.

The yield on the US 10-year Treasury note jumped as much as 6bps to 4.9% on Friday, before settling around 4.86%, after a stronger-than-expected jobs report boosted expectations of a Fed rate hike next month. The US economy added 165K jobs in October, well above forecasts of 65K. In addition, the unemployment rate fell to 4.1% and wage growth exceeded expectations, pointing to a resilient labour market capable of withstanding higher borrowing costs as the Fed seeks to contain inflationary pressures. Meanwhile, US stocks were on track to rebound from the sharp losses recorded in the previous session, easing demand for safe-haven assets and contributing to the reversal in Treasury prices. Investors have been reassessing the potential economic implications of the Democrats' sweep in the midterm elections, including the prospect of lower tax cuts and government spending, alongside potentially tighter AI regulation that could weigh on investment in the sector.

Canadian employment fell by 4,700 in October 2026, improving from a steep 68,300 decline in September but missing expectations for a 13,600 increase. Private-sector employment dropped by 53,000 (-0.4%), its first decline since February, while public-sector employment rose by 50,000 (+1.1%). Wholesale and retail trade shed 29,000 jobs (-1.0%), while construction added 16,000 (+0.9%) and educational services gained 15,000 (+1.0%). Employment declined in Alberta (-24,000; -0.9%) and Prince Edward Island (-1,300; -1.3%), but increased in British Columbia (+12,000; +0.4%) and Newfoundland and Labrador (+2,900; +1.2%). On a yearly basis, employment was nearly unchanged, rising by just 17,000 (+0.1%). The employment rate fell by 0.1 percentage points to 60.5%, marking its third consecutive monthly decline.

Average hourly earnings for all employees on US private nonfarm payrolls increased by 14 cents, or 0.4%, to $38.00 in October 2026, following an upwardly revised 0.3% gain and surpassing the expected 0.3% rise.This was the strongest increase in wages since January. In October, average hourly earnings of private-sector production and nonsupervisory employees rose by 12 cents, or 0.4%, to $32.75. Over the past 12 months, average hourly earnings have increased by 3.1% in October, after an upwardly revised 3.2% advance and above analysts' forecasts of a 2.9% rise.