- US stocks gained with the vast majority of sectors in the green and with only the Energy sector in the red as President Trump's executive orders and initial dollar firmness weighed on the crude complex. Nonetheless, it was a relatively quiet session with little fresh catalysts and in terms of stock specifics, MMM and SCHW reported strong earnings, while Oracle was buoyed in the wake of CBS reporting that Trump is set to announce billions of dollars in private sector investment to build AI infrastructure in the US with OpenAI, Softbank (SFTBY) and Oracle (ORCL) planning a JV.
- USD ended the session relatively unchanged after paring the overnight gains seen on reports that President Trump is considering 25% tariffs on Mexico and Canada with implementation likely on February 1st, as a broad-based recovery was seen across the G10 space amid little fresh catalysts.
- Looking ahead, highlights include Australian MI Leading Index, Malaysian CPI, Supply from Australia.
More Newsquawk in 2 steps:
1. Subscribe to the free premarket movers reports
2. Trial Newsquawk’s premium real-time audio news squawk box for 7 days
LOOKING AHEAD
- Highlights include Australian MI Leading Index, Malaysian CPI, Supply from Australia.
- Click for the Newsquawk Week Ahead.
US TRADE
- US stocks gained with the vast majority of sectors in the green and with only the Energy sector in the red as President Trump's executive orders and initial dollar firmness weighed on the crude complex. Nonetheless, it was a relatively quiet session with little fresh catalysts and in terms of stock specifics, MMM and SCHW reported strong earnings, while Oracle was buoyed in the wake of CBS reporting that Trump is set to announce billions of dollars in private sector investment to build AI infrastructure in the US with OpenAI, Softbank (SFTBY) and Oracle (ORCL) planning a JV.
- SPX +0.88% at 6,049, NDX +0.58% at 21,567, DJIA +1.24% at 44,026, RUT +1.85% at 2,318.
- Click here for a detailed summary.
NOTABLE HEADLINES
- US President Trump ordered officials to draw up retaliatory measures against countries applying “extraterritorial” levies on US multinationals, in a move that threatens to trigger a global confrontation over tax regimes, according to FT.
- US President Trump is using tariffs threat to push for an early renegotiation of US trade deal with Mexico and Canada, according to WSJ.
- US President Trump is set to announce billions of dollars in private sector investment to build AI infrastructure in the US with OpenAI, Softbank (9984 JT) and Oracle (ORCL) planning a JV called Stargate. This follows earlier comments from the White House spokesperson that US President Trump is to have a large infrastructure announcement on Tuesday.
- US Senate Finance Committee voted to advance Bessent’s nomination as Treasury Secretary to the full Senate.
FX
- USD ended the session relatively unchanged after paring the overnight gains seen on reports that President Trump is considering 25% tariffs on Mexico and Canada with implementation likely on February 1st, as a broad-based recovery was seen across the G10 space amid little fresh catalysts.
- EUR gradually recouped initial losses and shrugged off weaker-than-expected German ZEW Economic Sentiment to reclaim the 1.0400 status.
- GBP was ultimately flat with little reaction seen after the latest UK employment data printed in line with estimates.
- JPY swung between gains and losses before flatlining near the 155.50 level in the latter half of US trade despite further sources noting the BoJ is moving towards a rate hike at this week's meeting.
- Brazil's President Lula told his aides that he may not run for re-election in 2026 in a statement during a ministerial meeting yesterday, surprising the ministers, according to CNN Brasil.
- Canadian CPI Inflation YY (Dec) 1.8% vs. Exp. 1.9% (Prev. 1.9%)
FIXED INCOME
- T-notes were firmer with the curve flattening, albeit settling off initial peaks after Trump's inauguration.
COMMODITIES
- Oil prices were lower as President Trump's executive orders and initial dollar firmness weighed.
- Saudi Aramco's chief said he still sees a healthy oil market when asked about US President Trump's energy comments, while he added they will wait and see how sanctions on Russia translate into tightness in the market and that it is still at an early stage. Furthermore, they are expecting additional oil demand this year of around 1.3mln bpd and noted they are working with partners and looking at expanding their position regarding LNG. Aramco’s CEO also separately commented that "good" China demand is still driving oil growth.
- Port Houston said all eight public facilities will remain closed for Tuesday and Wednesday due to cold weather conditions.
- Port Freeport said limited activity is expected due to weather conditions in the Gulf Coast area in Texas.
- North Dakota oil output is estimated to be down 130k-160k bpd due to cold weather and Associated Wellhead Natgas production is estimated to be down 0.37-0.45 BCFD, while the majority of the lost production will return online within the next 4-7 days, according to the state pipeline authority.
- World refined copper market was in a 131k MT deficit in November 2024, according to ICSG.
GEOPOLITICAL
MIDDLE EAST
- Israeli military said its forces began an operation in the West Bank city of Jenin, while Hamas called for escalating the fighting against Israel in response to the army raid on Jenin.
- Israel's Chief of Staff is to submit his resignation to the Defence Ministry, according to Israeli media.
RUSSIA-UKRAINE
- Ukrainian President Zelensky said they are working on setting up a meeting with US President Trump.
- Ukraine's military said it hit a Russian oil depot in the Voronezh region for the second time in a week.
ASIA-PAC
NOTABLE HEADLINES
- China's Vice Premier said China's stable economic growth will provide strong impetus for global economic development and that China does not pursue a trade surplus, while he added that China's door of opening up will not close and they sincerely welcome more foreign companies to invest in China.
- China’s gaming regulator granted licenses for 123 domestic online games and licenses for 13 imported online games in January including one title from NetEase (9999 HK).
- BoJ is moving towards a rate hike at this week's meeting, according to Bloomberg citing Kyodo.
- Japan's government is likely to submit a nominee on 28th January to fill a seat at the BoJ which becomes available in March when Adachi's (Dovish) term ends, according to Reuters citing sources.
EU/UK
NOTABLE HEADLINES
- ECB's Nagel said they must do what is needed for Europe and decisions are to be data-dependent, while he noted some probability the ECB will cut next week but added that decisions are never a done deal.
- ECB's Villeroy said if the pace of rate cuts is steady, there is no need to make them bigger and in terms of easing, it will be entirely data dependent, while he stated if the ECB carries on, it can be at a 2% neutral rate by summer, according to Bloomberg TV.
- EU is to reportedly raise concerns with the US over its decision to restrict exports of AI chips from the likes of NVIDIA (NVDA) to some member states, according to Bloomberg sources.
- German Chancellor Scholz said the US remains their closest partner outside Europe and good relations are in both interests, while he added that European-US cooperation is essential for peace and security worldwide and an engine of successful economic development.
- Germany's ZEW said the second consecutive year of recession caused economic expectations in Germany to fall.
DATA RECAP
- UK Employment Change (Nov) 35k vs. Exp. 33k (Prev. 173k)
- UK ILO Unemployment Rate (Nov) 4.4% vs. Exp. 4.4% (Prev. 4.3%)
- UK HMRC Payrolls Change (Dec) -47k (Prev. -35k, Rev. -32k)
- UK Average Earnings (Ex-Bonus) (Nov) 5.6% vs. Exp. 5.5% (Prev. 5.2%)
- UK Average Wk Earnings 3M YY (Nov) 5.6% vs. Exp. 5.6% (Prev. 5.2%)
- German ZEW Current Conditions (Jan) -90.4 vs. Exp. -93.0 (Prev. -93.1)
- German ZEW Economic Sentiment (Jan) 10.3 vs. Exp. 15.3 (Prev. 15.7)
- EU ZEW Survey Expectations (Jan) 18.0 (Prev. 17)
