Overnight US stocks | All three major indices closed lower; NVIDIA Corporation (NVDA.US) fell 4.3%.

Thursday, all three major indices closed lower. NVIDIA Corporation CEO Jensen Huang's resignation and continued tensions in the Middle East weighed on market sentiment. NVIDIA Corporation fell by double digits at one point in early trading. Meanwhile, some funds rotated into NVIDIA Corporation's competitors, with both AMD and Broadcom Inc. shares rising about 5%. [US Stocks] At the close, the Dow Jones Industrial Average fell 189.40 points, or 0.36%, to 52,297.09; the S&P 500 fell 26.98 points, or 0.35%, to 7,592.40; the Nasdaq Composite fell 100.10 points, or 0.39%, to 25,366.09. NVIDIA Corporation (NVDA.US) closed down 4.3% after falling 13% intraday. Broadcom Inc. (AVGO.US) and AMD (AMD.US) rose more than 5.5%, while SK Hynix (SKHY.US) fell 3%. The Nasdaq Golden Dragon China Index closed down 3.1%, and Alibaba Group Holding Limited Sponsored ADR (BABA.US) fell 7%. [European Stocks] Germany's DAX30 rose 144.29 points, or 0.54%, to 26,786.36; the UK's FTSE 100 rose 28.09 points, or 0.26%, to 10,863.56; France's CAC40 rose 28.49 points, or 0.34%, to 8,361.36; the Euro Stoxx 50 rose 8.36 points, or 0.13%, to 6,401.75; Spain's IBEX35 fell 61.63 points, or 0.31%, to 19,966.27; Italy's FTSE MIB fell 124.04 points, or 0.24%, to 51,822.50. [Forex] The US Dollar Index, which measures the greenback against six major currencies, rose 0.26% on the day to close at 103.174 in late foreign exchange trading. As of late New York forex trading, 1 euro traded at US$1.1056, down from US$1.1091 the previous trading day; 1 pound traded at US$1.3236, down from US$1.3278 the previous trading day. 1 dollar traded at 159.83 yen, down from 159.86 yen the previous trading day; 1 dollar traded at 0.8353 Swiss francs, up from 0.8331 Swiss francs the previous trading day; 1 dollar traded at 1.4260 Canadian dollars, up from 1.4248 Canadian dollars the previous trading day; 1 dollar traded at 10.0226 Swedish kronor, up from 9.9770 Swedish kronor the previous trading day. [Cryptocurrencies] Bitcoin fell more than 3% to US$71,365 as of press time; Ethereum fell more than 2% to US$2,011.53. [Precious Metals] Spot gold fell 2.76% to US$3,878.01; spot silver fell 3.12% to US$50.061/oz. [Crude Oil] Light crude oil futures for December delivery on the New York Mercantile Exchange rose US$2.21 to settle at US$88.74 per barrel, a gain of 2.55%; London Brent crude oil futures for January delivery rose US$3.06 to settle at US$95.82 per barrel, a gain of 3.3%. [Macro News] Fed's Daly: Further rate hikes may be necessary to curb inflation. San Francisco Fed President Daly said Thursday that further monetary policy tightening may be necessary to bring down inflation, as inflationary pressures persist and are not solely concentrated in sectors directly affected by tariffs or oil prices. She said a growing number of businesses have told her they plan to pass higher input costs on to consumers, and companies' willingness to raise prices is increasing. Daly said she supported the Fed's decisions to hike rates in September and hold rates steady in October. On AI, Daly said AI infrastructure buildout is undoubtedly pushing up some prices, but the impact on overall inflation remains modest, with cost increases limited and not yet spilling over into other areas. She believes current overall inflation is mainly driven by other factors rather than AI-related goods. She remains optimistic about the long-term prospect of AI accelerating productivity growth, but it is too early to judge the timing of its realization. Daly is not a voting member of the FOMC this year. US October fiscal deficit reaches US$404 billion, up 42% year-on-year. US Treasury Department data showed that in the first month of fiscal year 2027 (October 2026), the US fiscal deficit reached US$404 billion, up 42% year-on-year. Government spending rose 12% year-on-year to US$773 billion that month, while tax revenue fell 9% to US$369 billion, of which tariff revenue fell about 39% year-on-year to US$19.2 billion. Increased spending on military, healthcare and national debt interest pushed up government outlays, while larger tariff and corporate tax refunds than a year earlier weighed on tax revenue. The US Treasury Department expects the fiscal deficit to rise slightly to about US$2.2 trillion this fiscal year. The previous fiscal year's US fiscal deficit was US$1.99 trillion, accounting for about 6% of GDP. Goolsbee: US inflation at a dangerous moment, further deterioration should be prevented. According to reports, Chicago Fed President Goolsbee said he had hoped US inflation would cool significantly as tariff effects faded and oil prices fell, but that expectation has not materialized. October CPI came in above expectations, rising for a second consecutive month, and Goolsbee said the US is at a "dangerous moment" for inflation and should remain prudent to prevent further deterioration. Goolsbee noted that persistent price pressures remain in CPI components such as services and healthcare, which are unrelated to tariffs and oil prices. He said the US is gradually entering a phase in which central banks historically find it difficult to contain inflation. Goolsbee said the Fed is currently trying to distinguish between two types of factors driving persistently high inflation: supply-side shocks such as tariffs and higher oil prices lasting longer than expected, and demand-side overheating from large-scale data center construction. He noted that AI-related inflation has not yet spread to the broader economy and is currently concentrated in AI, technology and related sectors, but the Fed is closely watching whether it spreads to other areas. If demand overheating triggered by data center construction begins to affect the broader economy, it will become a problem. He also said that a recently elected Democratic governor's proposal to pause data center construction is not currently directly related to the Fed's inflation work. Yen breaks below 160 mark, BOJ intervention risk rises. The yen fell below the 160 mark against the dollar for the first time since September, weakening for a third consecutive trading day. Rising US Treasury yields and growing expectations of Fed rate hikes have strengthened the dollar, with the US-Japan interest rate differential exceeding 250 basis points, increasing downward pressure on the yen. Japanese Ministry of Finance official responsible for foreign exchange affairs Atsushi Mimura said Thursday that recent yen exchange rate moves have been "too fast" and mentioned previous foreign exchange interventions; Japanese Finance Minister Satsuki Katayama and US Treasury Secretary Bessent had also previously signaled another intervention if necessary. Earlier, USD/JPY briefly fell more than 70 pips to 159.30, sparking speculation about intervention by Japanese authorities, before recovering to 159.72. Japan intervened in the foreign exchange market three times this summer, using a cumulative 15.4 trillion yen (about US$96.4 billion). [Individual Stock News] NVIDIA Corporation's forward P/E falls to 14-year low; shares down more than 30% from record high. NVIDIA Corporation (NVDA.US) shares have fallen sharply recently, with its forward P/E ratio dropping to about 12 times, the lowest level since 2012. After Jensen Huang's resignation, NVIDIA Corporation shares fell more than 4% on Thursday and about 11% for the week, down more than 30% from the record high set on October 6. In addition to the management change, the market is also concerned that AI data center construction may slow. NVIDIA Corporation Chief Financial Officer Colette Kress is currently serving as interim CEO, and the company is searching for a permanent successor. Analysts still maintain expectations for strong earnings growth at NVIDIA Corporation, expecting chip demand to continue exceeding supply. The market expects NVIDIA Corporation's October-quarter revenue to grow 92% year-on-year, with net profit exceeding US$60 billion, up 89% year-on-year. NVIDIA Corporation will report earnings next Tuesday, and investors will focus on Kress's comments on the company's future performance outlook; her guidance may draw more attention than the earnings report itself. Microsoft Corporation cloud service outage; AWS and Alphabet Inc. Class C also report anomalies. According to outage tracking website Downdetector, Microsoft Corporation (MSFT.US) experienced a widespread service outage on Thursday US Eastern Time, affecting thousands of users in multiple regions. The outage began shortly before 2 a.m. Beijing time on the 13th and affected Microsoft Corporation 365 services and Outlook. Meanwhile, users of Amazon.com, Inc.'s cloud service (AWS) and Alphabet Inc. Class C (GOOG.US) also reported service disruptions on the website. A Microsoft Corporation spokesperson said: "We are aware of the situation and are investigating user-reported Microsoft Corporation 365 service issues, which are mainly concentrated in Exchange Online." Microsoft Corporation initially posted on its social platform account "Microsoft 365 Status" that connectivity issues may have been caused by "high load in multiple regions" on some infrastructure. Microsoft Corporation later determined that the increased load was due to "some servers unexpectedly becoming unavailable, increasing pressure on the remaining infrastructure." Applied Materials, Inc. sales and profit both rise on semiconductor demand. Thanks to AI-driven semiconductor demand, Applied Materials (AMAT.US) achieved significant profit and sales growth in its fourth fiscal quarter. The company reported fourth-quarter profit of US$2.72 billion, or US$3.40 per share, compared with US$1.90 billion, or US$2.38 per share, a year earlier. Excluding certain one-time items, adjusted earnings per share were US$4.16, above analysts' prior estimate of US$4.06. Revenue rose 53% to US$10.41 billion, exceeding analysts' forecast of US$10.3 billion. Applied Materials, Inc. CEO Gary Dickerson said the company's semiconductor systems business is on track to achieve more than 40% growth this year. In the most recent quarter, sales in that segment surged 64% to nearly US$8 billion. For the first quarter of the new fiscal year, Applied Materials, Inc. expects revenue of US$11.1 billion (plus or minus US$500 million) and adjusted earnings per share of US$4.35 (plus or minus 20 cents). SpaceX and Tesla, Inc. merger talks reportedly progress, announcement as early as December. According to media reports citing people familiar with the matter, merger talks between SpaceX (SPCX.US) and Tesla, Inc. (TSLA.US) are making progress, with both boards and advisors discussing transaction terms and post-merger governance structure. The two companies could announce the merger as early as December, but have also discussed the possibility of delaying the announcement until early 2027. If completed, the merger would be one of the largest deals in history, combining electric vehicles, energy storage batteries, rockets and satellite businesses. The talks still face multiple obstacles, including how to isolate some of Tesla, Inc.'s overseas operations and national security issues related to SpaceX's contracts with the US Department of Defense. The two companies' boards had previously established independent director special committees to study the merger.