Asia open: Dancing in the dark

Markets woke today with two dominant rhythms—one driven by the AI boom’s drumbeat, the other by the muffled silence of Washington’s shutdown muffling the Fed’s compass. Traders are caught between a disco ball and a blackout, forced to dance even as the lights flicker.

The OpenAI news was the showstopper: a $500 billion valuation, already the most valuable private company in the world, vaulting from $300 billion in a blink. Whispers of $1 trillion valuations are now being spoken with a straight face. Whether this is another dot-com crescendo or the early notes of a century-defining revolution hardly matters in the near term. The music is loud, and while it plays, portfolio managers are circling the floor. AI capex is burning like a neon sign across U.S. corporate ledgers—though much of it bleeds abroad in imported chips and kit, an ironic drag on domestic GDP. It’s the oldest of Wall Street’s parables: the market prices the dream, not the footnote.

Meanwhile, oil is not dancing—it’s tumbling down the stairs. Brent and WTI have slumped nearly 10% in a week, scraping multi-month lows as the specter of oversupply takes over the stage. Four-handle crude is not yet on the screens, but $64 Brent and $60 WTI aren’t far off. With OPEC+ convening this weekend, chatter of a 500,000 bpd November hike—triple October’s increase—is coursing through the tape. * That’s supply theater more than supply shock; in practice barrels are harder to muster than headlines.*

Still, the price action speaks for itself. Oil is bleeding disinflation into every macro model, and equity desks love the scent of cheaper energy like oxygen at altitude. Surprised the EUR and JPY are not sniffing that out.

Talk of de-dollarization was another curtain-raiser this week, but the IMF’s numbers reveal more shadow play than substance. On the surface, the dollar’s share of reserves fell to 56.3%, the lowest since the euro’s birth. But strip away FX translation effects, and the story flips: central bank dollar holdings are steady, even edging higher. For all the grand talk of multipolar reserve regimes, the greenback remains the orchestra’s conductor. Traders know this instinctively; flows follow function, and the dollar’s plumbing still runs beneath every cross-border transaction.

And then there’s the U.S. government shutdown, which leaves Powell and company peering into darkness. The Fed cut rates in September with a “meeting-by-meeting” promise to stay data-dependent. Yet now the shutters are down on the very data they depend on—no payrolls today, no CPI on the 15th. It’s as if the Fed has been asked to steer a tanker through fog with the radar switched off. That makes October’s FOMC not just a policy meeting but a séance, where traders must divine direction without their usual analytics.

For traders in Asia this morning and around the globe, the absence of NFP is a guilty relief—a rare first week Friday without the thunderclap risk of a headline payroll surprise. The screens are quieter, the alerts still ping, but the heartbeats are slower. Some will take the early cut, step into the weekend before the next wave of OPEC headlines or AI hype rolls across the Pacific. Others will watch the tape’s flicker and note the irony: when the market flies blind, risk can feel both safer and scarier at the same time.

Have a good weekend !!!

* Recent analysis suggests only ~75% of planned OPEC additions have actually shown up (a ~0.5 mb/d shortfall), so another paper hike may have limited physical impact unless Saudi/UAE shoulder more. Next week, the market will tell you it’s not the quota—it’s the cargo that actually reaches shore, hence we may see a price rebound.