15th December 2025

MACRO

Trump Uncertain About GOP Holding House in Midterms

President Trump conveyed uncertainty about whether Republicans would maintain control of the House in next year’s midterm elections because some of his economic policies have yet to take full effect.

“I think by the time we have to talk about the election, which is in another few months, I think our prices are in good shape,” Trump said in a WSJ interview.

(Wall Street Journal)

Student Loan Delinquencies Soar

More than 9 million US student loan holders have missed at least one payment this year, as delinquencies in the $1.7 trillion market soar following the end of the Biden administration’s post-pandemic payments holiday.

(Financial Times)

Bank of Japan Set to Start Selling ETF Holdings

BOJ officials are likely to start selling the central bank’s pile of exchange-traded funds as early as next month, according to sources - a process expected to take decades to complete.

Big Japanese manufacturers’ business sentiment hit a four-year high in the three months to December, according to the Tankan survey, reinforcing expectations the central bank will raise interest rates this week.

Most Japanese companies surveyed expect to raise wages in fiscal 2026 at about the same rates as this year, while price expectations remain unchanged at 2.4% average annual inflation.

(Bloomberg, Reuters)

China Economy Shows Alarming Weakness

China’s factory output growth slowed to a 15-month low while retail sales posted their worst performance since zero-COVID ended, highlighting the urgent need for new growth drivers heading into 2026.

Property investment fell 15.9% year-on-year in the first 11 months, widening from the 14.7% drop in the January-to-October period.

President Xi Jinping lashed out at inflated growth numbers and vowed to crack down on “reckless” projects that exist only to show superficial results.

(Reuters, Bloomberg)

China Policy and Trade Developments

China plans to expand exports and imports next year as part of efforts to promote “sustainable” trade, a senior official said.

Beijing’s policy roadmap for 2026 released as part of the Central Economic Work Conference could fuel a second wave of the tech rally in A-shares, according to brokerages.

China’s commerce ministry and financial regulators have urged local authorities to promote stronger coordination between business and financial systems to boost consumption.

China is also buying its first cargo of Argentine wheat in decades as farmers harvest a record crop and President Milei trims export tariffs.

(Reuters, Shanghai Securities News, Bloomberg)

$3 Billion Shadow Banking Crisis in Eastern China

A $3 billion redemption crisis in eastern China is reviving concerns about the loosely-regulated shadow-banking industry as the nation’s prolonged property slump risks spilling over into the financial sector.

(Bloomberg)

UK Housing and Labour Market Softening

Asking prices for British homes have fallen more than usual for the time of year, reflecting uncertainty ahead of the government’s budget last month.

Wage growth for the lowest-paid workers is starting to slow as a worsening jobs market undercuts bargaining power for a section of the workforce that has proved resistant to the Bank of England’s inflation-fighting efforts.

The UK’s financial regulator is weighing reforms to widen mortgage market access by responding to more flexible working patterns and longer life expectancies.

New laws to regulate cryptoasset companies in Britain will help the country “lead the world in digital asset adoption,” City minister Lucy Rigby claimed.

(Reuters, Bloomberg, Financial Times)

Other Global Developments

Switzerland lifted its growth outlook for next year on the back of its trade deal with the US, while lowering inflation expectations.

Australia will consider toughening gun laws after a terror attack killed 15 people at Sydney’s Bondi Beach during Hanukkah celebrations.

RBNZ Governor Breman pushed back on expectations of cash rate hikes next year, saying rates were likely to remain at current levels for some time.

Thai authorities are ramping up efforts to curb the baht’s strength after the currency hit a four-year high, instructing financial institutions to tighten controls on forward forex transactions by gold traders.

South Africa’s central bank credited its new 3% inflation target for already helping guide expectations lower, and plans the biggest overhaul of the nation’s cash system in decades.

India’s trade deficit narrowed in November after widening to a record high in October.

Iran has brought in fresh petrol price increases as US sanctions force the oil-rich country to import refined fuel.

(Bloomberg, Reuters, Financial Times)

Hedge Funds Pile Into Commodities

Hedge funds including Balyasny, Jain Global and Qube are expanding operations to allow them to trade underlying commodity markets in search of fresh sources of returns.

(Financial Times)

GEOPOLITICAL

Zelenskyy Offers to Drop NATO Membership Bid

Ukrainian President Zelenskyy offered to drop Ukraine’s aspirations to join NATO during five hours of talks with US envoys in Berlin on Sunday, with negotiations set to continue Monday.

Allied security guarantees for Kyiv are the central focus of the discussions.

The EU’s effort to tap Russian assets as the main source of international funding for Ukraine is becoming “increasingly difficult” as leaders struggle to agree on a framework.

(Reuters, Bloomberg)

China-Japan Tensions Escalate

China announced countermeasures against the former chief of staff of Japan’s Self-Defense Forces as tensions between the neighbours simmer after remarks about Taiwan by Japan’s prime minister angered Beijing.

(Reuters)

Hong Kong Convicts Jimmy Lai

Hong Kong convicted pro-democracy media tycoon Jimmy Lai in his national security trial.

(Financial Times)

EQUITIES

SpaceX Preparing for Potential IPO

SpaceX is initiating the selection process for investment bankers to advise on a potential initial public offering, according to sources.

The company’s CFO informed employees that a public offering next year could raise significant capital, though timing is uncertain.

SpaceX’s valuation has increased to approximately $800 billion from $400 billion this summer, partly due to Starlink’s growth.

(Wall Street Journal)

CEOs to Keep Spending on AI Despite Spotty Returns

A Teneo survey finds 68% of chief executives plan to increase AI spending in 2026 despite less than half of current AI projects generating positive returns.

53% of investors expect AI returns within six months, while 84% of large-company CEOs anticipate it will take longer.

(Wall Street Journal)

OpenAI Ends 6-Month Vesting Requirement

OpenAI told staff it was ending its policy requiring employees to work for at least six months before their equity vests.

(Wall Street Journal)

iRobot Declares Bankruptcy

iRobot, the Roomba maker, declared bankruptcy. The company owes $352 million to its contract manufacturer Picea, with nearly $91 million of that debt past due.

(Wall Street Journal)

Coca-Cola’s Costa Sale at Risk of Collapse

Coca-Cola’s proposed sale of Costa Coffee is at risk of collapse. The company is holding last-ditch talks with private equity firm TDR Capital this weekend to try to salvage it.

(Financial Times)

United and American to Take Stakes in Azul

United Airlines and American Airlines will take stakes in Brazil’s Azul after a New York judge backed a restructuring plan that would see the carrier leave Chapter 11 within weeks.

(Financial Times)

Nvidia China Export Decision Questioned

The Republican chair of the House China committee has questioned the information on which the White House based its decision to allow Nvidia to export advanced chips to China.

(Financial Times)

Apple Faces Higher Chip Prices

Apple’s long-term agreements for DRAM chips are nearing expiry, which could force the company to pay higher prices to Samsung and SK Hynix starting January 2026.

(Wccftech)

China Vanke Scrambles to Avoid Default

China Vanke’s shares fell after proposals to extend a bond payment were rejected, fueling fears that authorities aren’t keen to step in and keep the developer afloat.

The company made a renewed effort to muster bondholder backing for an onshore debt repayment due this week to avoid a default.

(Wall Street Journal, Reuters)

Chip Industry Developments

Samsung Electronics is pursuing the production of AMD’s latest semiconductors in its next-generation foundry process.

The Kirin 9030 chip powering Huawei’s latest Mate 80 handset has been manufactured by SMIC with an improved 7nm process, still behind TSMC and Samsung, according to TechInsights.

Japan needs to take a niche approach to chip manufacturing rather than competing on scale and price as it aims to revive its chip industry, NTT’s chairman said.

(SE Daily, Reuters)

Chinese State Miner Wins SolGold Board Support

Chinese state-owned Jiangxi Copper has won the support of SolGold’s board after making a sweetened bid for the UK-listed company backed by BHP and Newmont.

(Wall Street Journal)

Moore Threads Falls on Cash Management Plans

Shares of Moore Threads Technology fell after plans to put most of the funds raised through its recent listing into banking products.

(Bloomberg)

Other Notable Moves

China’s new restrictions on car discounts signal the government is cranking up scrutiny of excessive competition in the local auto industry.

Tokyo Gas plans to invest in US downstream assets to lift earnings and reinforce its energy supply chain.

Nomura Holdings is on the lookout for private debt asset management acquisitions as it expands its alternative assets business.

Sanofi said a US regulatory decision on its tolebrutinib MS treatment would be delayed again, and a late-stage trial for a different form of the disease didn’t hit its main goal.

(Bloomberg, Reuters, Wall Street Journal)

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