Traders Cheer as Tariffs and Fed Cuts Take Center Stage

Markets are buzzing with excitement as traders anticipate a shift in the U. S. trade policy and a potential interest rate cut by the Federal Reserve. The idea that President Trump might lose his tariff battle is making investors happy. If the Supreme Court rules that Trump's tariffs are illegal, it could be a big win for stock markets. This is because some stocks have been struggling under the weight of tariff worries. Meanwhile, in Japan, the Nikkei 225 index surged by 3. 37% after a new political coalition was formed, paving the way for Sanae Takaichi to become the country's first female prime minister. This political development has boosted investor confidence in Japan's market. China's economy also showed resilience, with a GDP growth of 4. 8% in the third quarter, beating analysts' expectations. The CSI 300 index rose by 0. 53%. Investors seem to believe that China is not badly affected by Trump's tariff threats. They also think that the U. S. dependence on China's rare earth minerals makes it unlikely that tariffs will be imposed. In fact, the chances of tariffs happening by November are now just 7%, according to Polymarket. In Europe, the Stoxx 600 index was up by 0. 63%, and the U. K. 's FTSE 100 index rose by 0. 36%. Investors in the U. S. are also becoming more confident that the Federal Reserve will continue with its interest rate-cutting program. The upcoming release of the Consumer Price Index (CPI) data for September is expected to support a 0. 25% rate cut by the Fed next week. Some investors even speculate about a larger 0. 50% cut in December, although this seems less likely.