Unknowns AI and oil, debate on the Budget: the week of the markets

The economic week opens under the banner of three great catalysts: the boom in investments in artificial intelligence, the volatility of the oil market and the start of discussions on the 2027 budget.

The topic of artificial intelligence remains at the center of attention on the markets, after the sales triggered by the clear Democratic victory in the US midterms. The change in political balances and territorial dynamics are redefining the prospects of the sector across three key sectors: the slowdown on data centers, the regulatory tightening, investors' doubts that the enormous infrastructure costs required by AI may not translate into adequate returns in the short term.

Focus also on the energy sector, characterized by strong fluctuations in the price of oil due to geopolitical tensions. Investors are weighing the risk of a new military escalation between the United States and Iran against the prospects of a diplomatic breakthrough that will end the conflict. On a weekly basis, Brent fell by almost 13%, WTI by 12%.

In the spotlight, then, are the data on the CPI consumer price index and PPI producer prices in the US, which offer new elements on the inflation outlook, helping to define expectations on the Fed's next moves. At the moment the markets are discounting a further rate increase of 25 basis points for the month of December.

In Europe the focus is on the Eurogroup, which on Monday launches a first information examination to discuss the succession to the ECB of Christine Lagarde, who has formalized her early resignation starting from 7 February 2027. The candidacies are about to be finalized and the most accredited names are those of the former governor of the Dutch central bank Klaas Knot and the Spaniard Pablo Hernandez de Cos, president of the Bank for International Settlements.

On the domestic front, a crucial week for the budget law, whose parliamentary process officially comes to a head. The cycle of preliminary hearings of the social partners and economic institutions begins on Monday before the Budget commissions of the Chamber and Senate, which ends on Thursday 12 November with the intervention of the Minister of Economy, Giancarlo Giorgetti. On Friday the match moves to Palazzo Chigi, where the government has called the workers' and businesses' associations for a discussion. Among the hot topics, the discussion on taxes and measures for the middle class; the pension and social security dossier; contributions from the banking and economic system.