November 28, 2025 – The Capitol Advisor

Morning Briefing
— 6:00 a.m. ET

🌏 Overnight & Early Europe: What Happened

Asian markets finished November on firmer footing as renewed optimism about a potential rate cut by Federal Reserve helped soothe recent volatility. Investing.com+2fidelity.com+2
In Tokyo, the Nikkei 225 rose 0.2% to 50,253.91, buoyed by stronger-than-expected housing starts (+3.2% year-on-year in October). KSAT+1 Core inflation in Tokyo held at 2.8%, above the Bank of Japan target, keeping alive speculation of a future BOJ rate move. KSAT+1
Elsewhere in Asia the performance was mixed: South Korea’s KOSPI fell about 1.5% amid weak industrial and semiconductor data, while Chinese and Hong Kong markets were mixed — the Shanghai Composite rose slightly, Hong Kong’s Hang Seng Index dipped. Seattle Post-Intelligencer+2KSAT+2
In early European trade, most markets drifted higher: Germany’s DAX slipped about 0.2%, but the U.K.’s FTSE 100 edged up 0.2%, supported by energy and mining gains. France’s CAC 40 held steady. Seattle Post-Intelligencer+1

The broadly watched Asian-Pacific equities index (excluding Japan) was largely flat Friday — but on track for a ~3% weekly gain, its first increase in four weeks. Investing.com+2Business Standard+2
Treasuries rallied — marking a fourth straight month of gains — as investors increasingly priced in a December Fed rate cut. Investing.com+2Energy News+2
Volatility eased: with markets thin (U.S. still holiday-thinned), investors seem to be cautiously positioning — but skew remains tilted toward downside protection in U.S. equity options. Saxo Bank+1
Meanwhile, geopolitical noise and global macro uncertainty remain, but sentiment is holding up better than many expected given the choppy prior month. Energy News+1

U.S. markets were closed Thursday for Thanksgiving; today’s session is expected to be shortened and light. Investing.com+1
With limited fresh economic data (partly due to prior government shutdown disruption), markets are leaning heavily on expectations of a rate cut from the Fed next month to drive sentiment. Reuters+2Saxo Bank+2
Some soft U.S. employment data earlier this week, combined with dovish signals from Fed officials, helped lift risk sentiment into the holiday. Reuters+1
No major corporate-earnings headlines have broken overnight; focus remains on macro and policy catalysts.

In Japan, persistent core inflation at 2.8% has revived speculation of a future rate move by the BOJ — though no hike is expected at the next meeting. KSAT+1
Markets broadly are betting on a December interest-rate cut by the Fed — with futures pricing the odds at roughly 85%, up sharply from just 30% a week ago. Investing.com+2fidelity.com+2
That pivot in expectations appears to have quelled some of the valuation concerns haunting growth and tech stocks over November, creating a friendlier backdrop for risk assets. Investing.com+1

Over November, cryptocurrencies suffered steep drawdowns amid broader equity volatility — for example, risk assets like BTC bore the brunt of tech-led weakness. Energy News+1
But with rates anticipated to fall and volatility cooling, sentiment toward crypto may improve — especially if risk assets broadly inch higher into year-end. Investing.com+1
That said, thin trading volumes this week (due to U.S. holiday) may amplify swings; any surprise in macro or regulatory news could jolts digital assets.
Keep an eye on potential catalysts: U.S. regulatory developments on crypto, shifting risk premium in equity markets, and rate expectations.

European inflation data (e.g. German inflation print) — this could move European markets and FX.
Any new comments from Fed officials or a shift in rate-cut expectations via futures.
Early cues from U.S. futures / pre-market trade as Wall Street reopens.
Developments out of Asia: follow-up Japanese inflation or BOJ signals; South Korean industrial data.
Continued price action in Treasuries — yields remain a key barometer of global rate sentiment.

Asian markets ended November on firmer ground as hopes of a U.S. rate cut revived risk sentiment.
Tokyo saw gains as housing starts surprised to the upside and core inflation remained elevated — keeping BOJ hawkishness in play.
Treasuries rallied and volatility cooled, even as volume remains thin ahead of month-end.
U.S. markets resume today with muted action, with investors focused on macro and policy — not earnings.
Cryptocurrencies remain under pressure, but lower rates and improving risk appetite could support a rebound into year-end.