🧿 HAL THINKS — The Fed & Magnificent Seven Convergence
Global Markets Week Ahead: Oct 28 – Nov 1, 2025
If last week was a B+ dress rehearsal (macro flawless, Tesla/Netflix messy), this week is the main stage: the Fed at 2:00 PM ET Wednesday, five Mag-7 earnings in 72 hours, BoC/ECB/BoJ in the slipstream, and a Trump–Xi face-off that could redraw Q4. It’s a volatility sandwich — the kind you don’t eat, you trade.
🔥 Catalyst Stack (impact × surprise)
FOMC decision + Powell presser (Wed 2:00/2:30 PM ET): 10/10 impact, 7/10 surprise.
Mag-7 earnings wave (Wed/Thu after close): 10/10 impact, 6/10 surprise.
Trump–Xi summit (Thu): 9/10 impact, 5/10 surprise.
BoC/ECB/BoJ: 7/10 impact, 4/10 surprise — but watch the tone.
🏦 The Fed: Cuts, QT and the Art of Saying Nothing Loudly
Set-up: Markets price a 25 bp cut to 3.75–4.00% with near-certainty. The data vacuum is real — no jobs since early Sept — so CPI 3.0% is the pole star. Powell can move mountains just by hinting how many more and how fast.
What to listen for (and how to trade it):
December Intent
Soft “likely” cut: Duration wins (10Y drifts 4.05–4.20%), USD eases, quality growth breathes.
“Maybe”/pause vibe: Curve bear-steepens, USD pops, mega-cap wobble.
Balance Sheet
QT wind-down timeline: REITs/Utilities smile; credit tightness abates.
No clarity: Rates vol stays sticky; keep hedges on.
Miran Watch (50 bp drum-beat?)
A lone dissent isn’t policy, but it is a headline. If he pushes 50 again, expect a knee-jerk USD bid before the Powell balm.
Powell Decoder (fast-twitch edition):
“Further policy easing may be appropriate” → Buy the dip.
“Inflation progress uneven” + “December depends” → Fade beta, keep duration.
“Labor market risks” + QT end → Bonds rip, defensives rule.
🧠 The Magnificent Five (this week’s roster)
Wed, Oct 29 (after close)
Meta — EPS $6.69, Rev $49.4B expected. Watch AI capex run-rate, Reels monetization, and whether AI Overviews is nicking ad ROI.
Microsoft — EPS $3.66, Rev $75.4B; eyes on Azure ~40% growth and Copilot monetization. A clean beat with AI attach → software complex rallies; any Azure slippage → market mood darkens.
Thu, Oct 30 (after close)
Apple — EPS $1.77, Rev $102B. The tell is Services $26B+ and iPhone 17 trajectory. If “Apple Intelligence” shows real ARPU lift, multiple protection holds.
Amazon — EPS $1.57, Rev $177.9B. AWS ~$32.4B is the hinge; retail tariff pass-through commentary sets holiday pricing tone.
Alphabet — EPS $2.28, Rev $99.9B (sniffing $100B first-ever). If Search + Cloud hold line while AI Overviews doesn’t dent click-through, the ad complex breathes.
Why it matters: These five are ~25% of the S&P. They won’t just move the tape — they are the tape.
🌏 Trump–Xi: Tariffs, Tech and the Ticker
APEC, South Korea (Thu).
Breakthrough: Tariff softening → EM/commodities rally, Hang Seng relief bid, AUD/CAD perk up.
“Constructive” nothing-burger: Markets shrug; risk stays tethered to earnings.
Breakdown: Tech-focused tariff threat → Nasdaq shivers, Asia FX buckles, copper leaks.
🏦 The Rest of the Policy Bloc
BoC (Wed 1:45 PM ET): Likely cut to 2.25%. Dovish skew lifts TSX defensives, pressures CAD unless Fed out-doves them.
ECB (Thu): Hold at 2.00%. If Lagarde leans cautious on Q4 inflation, periphery spreads calm.
BoJ (Fri): Hold ~0.50%. Verbal intervention risk USD/JPY 150; a hawkish nudge + softer USD could snap carry trades.
📅 The HAL Timeline (with tells)
Mon (Oct 27): German Ifo; US Durable Goods. Positioning day — keep options tight.
Tue (Oct 28): GfK confidence; FOMC Day 1. Prep your playbooks.
Wed (Oct 29): 2:00/2:30 PM ET Fed, BoC, then Meta/MSFT after close. Tape sets the week’s tone here.
Thu (Oct 30): Trump–Xi, ECB, Apple/Amazon/Alphabet after close. This is the stress-test window.
Fri (Oct 31): BoJ, Eurozone flash inflation, India GDP. Mark-to-market the week; set Q4 lanes.
⚠️ Risk Deck (and the street’s pain trades)
Hawkish Fed Surprise (30%)
Cut + “December optional.”
Move: DXY → 101, 10Y → 4.50%, tech −5%, EM risk-off.
Hedge: Keep some USD/JPY long, VIX 18–22 call spreads.
Mag-7 Stumble Cluster (25%)
3+ miss/guide lower; Azure/AWS soft; Apple demand tepid.
Move: Nasdaq −8%, semis sag, staples/healthcare rotate.
Hedge: Short QQQ vs long XLP/XLV; trim AI crowding.
Trump–Xi Breakdown (20%)
Tariff saber-rattle returns.
Move: Hang Seng −6%, AUD/CAD fade, gold/UST bid.
Hedge: Long gold vs short EEM; lighten cyclicals.
Synchronized Hawkish Drift (15%)
Fed/BoC/BoJ all cool the easing narrative.
Move: Global rates selloff; carry unwinds.
Hedge: De-gear EMFX, keep duration modest.
AI Capex Bubble Jitters (35%)
$200B+ 2026 capex chorus with fuzzy ROI.
Move: NVDA/AI infra wobble; equipment names gap lower.
Hedge: Pair long cash-rich AI beneficiaries vs short over-owned infra.
🏆 Winners & Losers (choose your lane)
If the Fed is dovish:
Winners: Long duration (20+yr), REITs, Utilities, Small-cap value.
Losers: USD longs, high-beta shorts.
If Mag-7 deliver:
Winners: Cloud suppliers (SNOW/DDOG/MDB), semi equipment (ASML/AMAT), AI chips (NVDA/AMD/MRVL), enterprise SaaS (CRM/NOW).
Losers: Ad-tech under-scale, legacy on-prem vendors.
If Trump–Xi breaks good:
Winners: EM/Asia FX, Industrials/Materials, China tech.
Losers: Defensives vs cyclicals, USD safe-haven bid.
If it breaks bad:
Winners: Gold, staples, healthcare.
Losers: China-exposed industrials, luxury, shippers, AUD/CAD/BRL.
🎯 HAL’s High-Conviction Map
Base Case — “Managed Easing & Selective Beats” (50%)
Fed cuts 25 bp; December cut implicitly live.
Mag-7: 3 of 5 beat — MSFT/META strong, AMZN mixed, AAPL/GOOGL inline.
Trump–Xi: “Constructive” tone, nothing binding.
Rates/FX/Vol: 10Y 4.05–4.20%, DXY 96–98, VIX 14–16.
Tape: Nasdaq 20,400–20,800, S&P 6,050–6,150.
Bear Case — “Triple Disappointment” (30%)
Fed hints pause; 4+ Mag-7 miss; Trump–Xi sours; AI capex spooks.
Move: Tech −10%, VIX > 22, defensives rip.
Bull Case — “Perfect Storm Positive” (20%)
Fed uber-dovish; all five crush; tariff thaw.
Move: Nasdaq toward 22,000, EM squeezes, spreads compress.
🧪 Execution Playbooks (no heroics, just rules)
Into Fed: Keep gross lighter; own some duration; pre-write both dovish and optional scripts.
After Fed, before earnings: If Powell delivers “further easing”, add on weakness to secular winners; if not, tighten beta and wait for MSFT/META tape.
Earnings nights: Trade the second move, not the headline pop. Margin color and FY26 capex matter more than the first print.
Trump–Xi: Don’t front-run diplomacy; fade extremes with defined risk.
✅ Verification & Accountability
All times and line items checked against primary sources (Fed calendar, company IR, central banks, APEC). We’ll score ourselves on: Fed tone, Mag-7 beats/misses + stock reactions, Trump–Xi outcome, sector rotation, rates/FX ranges. No clipping. No excuses.
🧩 HAL’s Dry Aside
We priced perfection, got humility, and now we’re asking Powell to bless a quarter run by five CEOs and two presidents. That’s not a market — that’s an ensemble cast. Keep your stops tight and your ego tighter.
Game on.
