Asia Turns Risk-Off as Central Bank Week, AI Selloff Weighs

Here’s your quick read to start the day: a chatty, no-fuss look at overnight moves, the big story, what’s on the docket, and the tickers you need to watch.

By Richard Fargose

December 15, 2025 at 1:45 AM IST

GLOBAL MOOD: Risk-Off
Drivers: Ukraine peace shift, Fed leadership uncertainty

Asian markets opened risk-off as investors cut exposure ahead of a crowded week of global central bank decisions and delayed US data. Hawkish Fed dissent, an AI-led tech selloff, rising yields, and supply-driven oil weakness outweighed tentative optimism from Ukraine peace talks.

TODAY’S WATCHLIST

China November Industrial Production Data
India November Trade Data
US FOMC Member Williams Speaks

THE BIG STORY
Ukraine has dropped its long-standing ambition to join NATO as part of a potential compromise to end the war with Russia, President Volodymyr Zelenskiy said ahead of talks with US envoys in Berlin. Instead, Kyiv is seeking firm security guarantees from the US, Europe and other partners, a significant shift for a country that enshrined NATO membership in its constitution and has viewed it as the ultimate safeguard against future Russian aggression. While the move meets one of Moscow’s key demands, Zelenskiy stressed that Ukraine has not conceded on territorial integrity, keeping some red lines firmly in place.

The diplomatic recalibration comes as US politics add another layer of uncertainty. President Donald Trump said he has narrowed his choice for the next Federal Reserve chair to Kevin Warsh or Kevin Hassett and suggested he should be consulted on interest-rate decisions, an unusual stance that could challenge the Fed’s independence.

Data Spotlight
The UK trade deficit widened sharply to £4.82 billion in October 2025 from £1.09 billion in September, marking the largest gap since February. The deterioration was caused by a 0.3% month-on-month fall in exports to £77.00 billion, a four-month low, alongside a 4.5% rise in imports to £81.82 billion, the highest in seven months. Goods exports declined 0.8% to £30.96 billion, weighed down by weaker shipments to non-EU countries, while goods exports to the EU rose 1.7%, supported by machinery and transport equipment. Notably, exports to the US surged 27%, led by precious metals. Services exports were broadly flat, edging up 0.1%, while goods and services imports climbed to 6.8% and 0.4%, respectively.

Takeaway: The sharp widening in the UK trade gap reflects import-led pressure rather than a collapse in exports. Strong US-bound exports offer a bright spot, but rising import demand remains a drag on the trade.

WHAT HAPPENED OVERNIGHT

US stocks slide as AI rout triggers sector rotation
- Major indexes fall with S&P 500 dropped 1%, Nasdaq sank 1.8% and the Dow slipped 0.4% on Friday as investors exited large-cap tech.
- Broadcom plunged 11.4% after warning of margin pressure, reigniting concerns over the profitability of heavy AI investments.
- Nvidia fell 3.3%, AMD slid 4.8%, Micron dropped 6.7% and Palantir declined 2.1%, dragging the tech complex lower.
- Oracle slipped another 4.5%, adding to Thursday’s near-11% drop after issuing a weak outlook, despite denying reports of data-centre delays.

US Treasury yields rise as Fed dissent rekindles inflation concerns
- The 10-year US Treasury yield rose 5.1 bps to 4.192% on Friday after two consecutive sessions of declines.
- The 10-year yield posted second straight weekly rise.
- Gains followed comments from Federal Reserve officials who dissented against last week’s rate cut, warning that inflation remains too high to justify further easing.
- Pushback from hawkish policymakers reinforced concerns that borrowing costs may stay elevated for longer than markets expect

US Dollar rebounds modestly, but weekly Losses persist
- The dollar index rose 0.1% to 98.44 on Friday, rebounding from a two-month low hit in the previous session.
- Despite Friday’s uptick, the index was down by 0.6% last week, posting loss for the third consecutive week.
- Persistent bets on interest rate cuts by the Federal Reserve next year continue to cap any sustained dollar strength.

Crude oil prices slides for the week as supply glut fears dominate
- Brent crude prices logged a 4% weekly decline, weighed down by concerns over excess supply.
- Hopes of a potential Russia–Ukraine peace deal reinforced expectations of higher future supply, overshadowing the impact of the US seizure of a tanker near Venezuela.
- Brent crude settled 16 cents lower at $61.12 per barrel and WTI crude closed down at $57.44 per barrel.

Day’s Ledger

Economic Data

China November Unemployment Rate
China November Industrial Production Data
India November WPI Inflation Data
India November Trade Data
US NY Empire State December Manufacturing Index

Corporate Actions

Can Fin Homes to consider dividend
Matrimony.Com to consider share buyback

Policy Events

US FOMC Member Williams Speaks

TICKERS TO WATCH

ASHOKA BUILDCON JV won BMC flyover project worth ₹10.41 billion, with Ashoka holding a 51% stake.
ASTRA MICROWAVE PRODUCTS received ₹1.24 billion order from JV ASTRA RAFAEL COMSYS for SDR-related supplies.
ATUL to acquire a 26.3% stake in TORRENT URJA 39 for up to ₹0.14 billion to source captive hybrid renewable power.
BHARAT ELECTRONICS bagged additional defence and electronics orders worth ₹7.76 billion since November 14.
ESAF SMALL FINANCE BANK board approved sale of NPAs and written-off loans up to ₹17.0 billion to an ARC under Swiss Challenge method.
GODAWARI POWER AND ISPAT expanded BESS project to 40 GWh with total investment raised to ₹16.25 billion, to be executed in two phases.
GODREJ PROPERTIES sold homes worth ₹26.0 billion in its first year in Hyderabad and plans further expansion.
GPT INFRAPROJECTS JV emerged L1 for Mumbai flyover project worth ₹17.39 billion; GPT’s share estimated at ₹4.52 billion.
INDIGO operations stabilised with over 2,050 daily flights and normalised on-time performance.
KEC INTERNATIONAL secured new orders worth ₹11.5 billion across T&D and civil businesses; Manjit Singh Sethi resigned as ED–Renewables.
WIPRO expanded partnerships with GOOGLE CLOUD and MICROSOFT to accelerate enterprise AI adoption using Gemini Enterprise and Frontier Firms framework.

MUST READ

See you tomorrow with another edition of The Morning Edge.

Have a great trading day

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