KEY events from around the world. If you want more info, I could send you a .pdf with key charts.
Tariff Deadline: President Donald Trump’s deadline for imposing tariffs is approaching, with potential 25% tariffs on imports from Canada and Mexico aimed at curbing illegal migration and fentanyl trafficking. The impact could be significant given the annual trade volume of a trillion dollars. There’s uncertainty regarding a possible 10% tariff on Chinese goods following a “friendly” phone call between Trump and Xi Jinping, but the White House has not ruled it out.
U.S. Jobs Report: The upcoming U.S. jobs report on February 7 is crucial as it will influence expectations on Federal Reserve’s monetary policy, particularly interest rate cuts. The previous month’s strong job growth led to higher Treasury yields, and the new report could either affirm or challenge the current market expectations regarding inflation and rate adjustments. Trump’s labor market policies, including immigration crackdowns and federal workforce reduction, add another layer of complexity.
AI and Technology Market: The AI sector is experiencing shifts with the emergence of China’s DeepSeek, which has disrupted assumptions about AI development costs and capabilities, impacting Nvidia’s stock value and prompting a reevaluation of the dominance of major U.S. tech firms. Upcoming earnings from Alphabet and Amazon will be pivotal in understanding whether this AI market volatility signals future challenges or investment opportunities.
European Bank Earnings: Major European banks are set to report their fourth-quarter results, with expectations of profit boosts from higher interest rates and investment banking. However, the sector faces challenges from potential rate cuts and economic weakness in Europe compared to a robust U.S. economy. Deutsche Bank’s recent profit drop has raised some concerns.
Bank of England Decision: The Bank of England’s interest rate decision is on the horizon, with markets partially anticipating a rate cut amidst signs of a slowing UK economy. Factors include deteriorating employment metrics, a contraction in consumer spending, and high government borrowing costs post-bond market turbulence. The economic outlook remains cautious despite governmental plans for growth.
