InvestMacro

On Wednesday, the US stock market closed with a decline. The Dow Jones Index (US30) lost 0.13%, though it hit a new all-time high at the session opening. The S&P 500 (US500) edged down by 0.01%, and the tech-heavy Nasdaq (US100) closed 0.16% lower. Strong employment data (NFP growth of 130k and a decrease in unemployment) confirmed the resilience of the labor market and lowered expectations for an early easing of Fed policy. Non-Farm Payrolls rose by 130k due to private sector support, more than double the expectations, while the unemployment rate unexpectedly fell.

Stock markets in Europe mostly declined yesterday. The German DAX (DE40) dropped by 0.53%, the French CAC 40 (FR40) closed down 0.18%, and the Spanish IBEX 35 (ES35) fell 0.43%. Conversely, the British FTSE 100 (UK100) closed 1.14% higher. European indices ended Wednesday without a clear trend amid mixed corporate earnings reports. Siemens Energy surged 8.5% due to a nearly threefold increase in profit, and Ferrari rose by more than 4%.
Platinum prices (XPT) are holding just above $2,100 per ounce, remaining under pressure near annual lows. Weak demand for autocatalysts and rising US yields are offsetting the impact of mining restrictions in South Africa, while existing inventories and recycling mitigate deficit risks. Additional pressure comes from strong US labor market statistics and expectations of delayed Fed rate cuts, which support the dollar and reduce investment interest in precious metals.

WTI prices rose more than 1% to above $65 per barrel, approaching highs not seen since September amid intensifying tensions surrounding Iran. The market is reacting to reports of a possible tightening of the US stance, which could jeopardize oil supplies if negotiations fail. However, gains were limited by EIA data showing US crude inventories increased by 8.5 million barrels – the highest jump in a year. Investors are also awaiting reports from OPEC and the IEA, where signals of a possible supply surplus this year are expected.

Asian markets rose confidently on Wednesday. While Japan’s Nikkei 225 (JP225) did not trade, the Chinese FTSE China A50 (CHA50) fell by 0.22%, Hong Kong’s Hang Seng (HK50) gained 0.31%, and the Australian ASX 200 (AU200) posted a positive result of 1.66%.

On Thursday, the offshore yuan (CNH) strengthened beyond 6.89 per dollar, extending its winning streak to a sixth session and hitting its highest level since May 2023. The currency is supported by statements from Xi Jinping regarding the ambition to elevate the yuan’s global status as a reserve currency. Since the beginning of last year, the dollar has weakened against the yuan by approximately 6%. However, growth is limited by the People’s Bank of China’s “moderately dovish” stance and weak inflation data: in January, CPI slowed to 0.2%, and producer price deflation narrowed to 1.4% – a one-and-a-half-year low.

The Australian dollar (AUD) rose above $0.71, reaching a three-year high following hawkish signals from the RBA. Governor Michele Bullock stated a readiness for further rate hikes if inflation remains persistent, emphasizing that figures “starting with a three” are unacceptable. Inflation expectations rose to 5% in February, strengthening hawkish sentiment. The market is now pricing in the probability of a rate hike in May.

On Tuesday, trading on the US stock market closed with mixed performance. The Dow Jones Index (US30) gained 0.10%. The S&P 500 (US500) declined by 0.33%. The tech-heavy Nasdaq (US100) closed lower by 0.59%. The market was pressured by weak US retail sales data for December (0% against projections of +0.4%), which intensified concerns regarding consumer demand and supported expectations of more than two Fed rate cuts this year. Bond yields decreased across the curve. A positive outlier was Spotify, whose shares soared 14.8% due to strong earnings and audience growth.

Stock markets in Europe mostly declined yesterday. The German DAX (DE40) fell by 0.11%, the French CAC 40 (FR40) closed up 0.06%, the Spanish IBEX 35 (ES35) dropped 0.40%, and the British FTSE 100 (UK100) closed down 0.31%. Investors remained cautious ahead of key US employment and inflation data, which may clarify the Fed’s next steps. The focus also remained on the corporate earnings season.

On Wednesday, silver (XAG) rose nearly 2% to $82 per ounce, recovering previous session losses amid weak US data and declining confidence in American assets. Retail sales in December unexpectedly slowed, fueling fears for consumer demand. Attention is now focused on the jobs report; weak data could further support precious metals. Markets are already pricing in about 60 bps of Fed rate cuts by the end of the year. Additional demand for safe-haven assets is linked to outflows from dollar instruments amid political uncertainty in the US. However, market participants remain cautious due to recent high volatility and sharp fluctuations in metal prices.

The US natural gas prices (XNG) rose to $3.17 per MMBtu, snapping a two-day decline amid near-record LNG exports. Deliveries to the eight largest terminals in February reached 18.5 billion cubic feet per day, limiting domestic supply. Previously, Arctic cold led to a record reduction in inventories, which are currently about 1% below normal.

Asian markets grew confidently on Tuesday. The Japanese Nikkei 225 (JP225) jumped 2.28%, the FTSE China A50 (CHA50) rose by 0.02%, the Hong Kong Hang Seng (HK50) gained 0.58%, while the Australian ASX 200 (AU200) showed a negative result of 0.03%.

Chinese stocks ended the session higher amid expectations of high consumer demand during the Lunar New Year period. Additional optimism was sparked by reports of a possible meeting between Donald Trump and Xi Jinping in April. On Wednesday, the offshore yuan held around 6.91 per dollar, near highs since April 2023, amid steady daily fixing by the PBoC. The Central Bank set the midpoint rate at 6.9438, signaling a desire for stable and moderate currency appreciation despite softer policy rhetoric. However, the yuan’s rise is capped by the confirmation of a “moderately easy” monetary policy stance. January inflation slowed to 0.2% YoY from 0.8%, while producer price deflation narrowed to 1.4% thanks to stabilizing commodity prices and measures to limit excessive competition.

The Reserve Bank of Australia (RBA) stated its readiness for further measures to curb inflation, which, according to RBA Deputy Governor Andrew Hauser, remains “too high.” The regulator intends to “do whatever is necessary” to return inflation to the 2-3% target range. Last week, the RBA raised the rate by 25 bps, reversing a previous cut after inflation again exceeded projections. Both headline and core inflation remain above the target, and a return to the target level is not expected until mid-2027.

On Friday, trading on the US stock market ended with a sharp rally. By the end of Friday, the Dow Jones (US30) surged by 2.47% (+2.74% for the week), hitting a new all-time high amid a broad recovery following the sharp correction earlier in the week. The S&P 500 (US500) gained 1.97% (+0.23% for the week), while the tech-heavy Nasdaq (US100) closed higher by 2.15% (-1.63% for the week). Diminishing concerns over short-term risks in the AI sector and easing pressure from forced deleveraging brought buyers back to the market, as many actively used the dip as an entry point. The S&P 500 and Nasdaq also rose firmly, bolstered by a sharp reversal in the semiconductor segment and a recovery among key industry leaders.

On Monday, Bitcoin (BTC) held above the $70,000 mark, stabilizing after sharp fluctuations late last week. Market sentiment moderately improved following significant inflows into US spot Bitcoin ETFs, indicating renewed interest from institutional and tactical investors who took advantage of the recent dip. Nevertheless, market participants remain cautious. Analysts note that it is not yet certain if the correction is fully over, and the current recovery could be technical in nature. Last week, Bitcoin lost all gains accumulated since the election of US President Donald Trump, dropping to $60,000 – its lowest level since October 2024.

European equity markets mostly rose on Friday. The German DAX (DE40) climbed 0.94% (+1.35% for the week), the French CAC 40 (FR40) closed up 0.43% (+2.34% for the week), the Spanish IBEX 35 (ES35) rose by 1.11% (+0.75% for the week), and the British FTSE 100 (UK100) closed up 0.59% (+1.43% for the week). The British Index continued its steady climb, recording its second consecutive positive weekly result. The main contributors were the banking sector and oil and gas giants, which benefited from a general lift in commodity markets, from oil to industrial and precious metals. Additional support for sentiment came from the Bank of England’s “dovish” hold: although rates remained unchanged, an unexpectedly narrow vote split intensified expectations for an earlier start to the easing cycle, with the market now pricing in a nearly 70% probability of a rate cut in March.

On Monday, silver (XAG) rose by approximately 5% to $82 per ounce, continuing a strong recovery following a nearly 10% jump on Friday. Traders have been actively buying the metal after a historic collapse in which prices lost nearly half their value. Simultaneously, market focus is shifting to key US employment and inflation data to be released this week, which could set the direction for Fed policy expectations.

WTI crude oil price saw volatile trading on Friday: prices initially declined due to easing geopolitical risks in the Middle East, but later recovered to rise over 0.5%, reaching the $63.7 per barrel area. Pressure on the quotes came from positive signals from US-Iran nuclear program talks in Oman, which the Iranian side described as a “good start” with intentions to continue dialogue. This reduced fears of supply disruptions from a region accounting for about a third of global oil production. A negative factor was Saudi Arabia’s decision to cut official selling prices for its flagship crude to Asia to the lowest level since late 2020, highlighting a comfortable supply situation. However, the less aggressive-than-expected price cut indicates ongoing confidence in demand resilience.

On Monday, US natural gas (XNG) prices plummeted by 6.2% to approximately $3.20 per MMBtu, extending the previous session’s sell-off and hitting a more than three-week low. The primary downward factor was updated weather prognoses indicating sustained warming across much of the US. Milder temperatures are expected to reduce demand for heating and electricity generation, directly lowering natural gas consumption.

Asian markets traded without a single trend last week. The Japanese Nikkei 225 (JP225) rose by 1.27% over the trading week, the FTSE China A50 (CHA50) increased by 0.18%, Hong Kong’s Hang Seng (HK50) fell by 1.98%, and the Australian ASX 200 (AU200) posted a negative 5-day result of 1.27%.

The Australian dollar (AUD) strengthened to 0.70 USD on Monday, continuing last week’s gains amid cautiously hawkish rhetoric from the Reserve Bank of Australia. Speaking before the House of Representatives Standing Committee on Economics, RBA Governor Michele Bullock emphasized that interest rates must remain high to curb persistent inflation. She also pointed to labor market resilience, which complicates the timing for any potential policy easing.