The week that was

Global equity markets edged modestly higher last week, with Emerging Markets and Europe among the stand-out performers from a regional perspective. The strength in Europe (+0.77%) was driven by value-orientated sectors such as Energy and Basic Resources which are benefiting from a stronger pricing environment. In contrast, US equities trended modestly lower (-0.38%), with the financial sector underperforming following a mixed bag of quarterly updates and increased focus by the Trump administration on sector regulation ahead of this year’s mid-term elections. Global commodities moved over 1.5% higher, with silver having a particularly strong week on the back of strong industrial demand and easing US inflation which further supported the prospect of easier monetary policy. Global bonds were largely unchanged for the second week in a row despite significant issuance.

Summary economic releases

The week ahead

Asian markets moved lower overnight, reflecting rising geopolitical tensions and mixed macro data from China. Quarterly GDP was in line with expectations at 4.5%, however the data served to highlight the unbalanced nature of the Chinese economy with strong export-orientated data but weak domestic demand. Rising tensions between Europe and the US in relation to Greenland are also weighing on sentiment. Safe havens such as gold and silver hit record highs overnight while the dollar weakened amid European leaders’ ready retaliatory measures against a prospective 10% US tariff from 1 February on eight countries.

Geopolitical issues such as the Ukraine war and the future of Greenland will be discussed by US and European leaders at the World Economic Forum which kicks off in Davos today. The US President will no doubt address these topics along with efforts to make US home ownership more affordable when he delivers Wednesday’s keynote address. Wednesday will also see the US Supreme Court hear arguments on efforts to dismiss Lisa Cook from the Fed due to mortgage fraud and there may also be a decision on the legality of tariffs. Releases on Thursday will likely shed further light on the future path of interest rates through the ECB’s December minutes and inflation data from the US for October and November ahead of the Fed’s policy meeting next week. On Friday, cooling inflation will likely result in the BOJ keeping rates unchanged while S&P/HCOB PMI data for January will likely indicate industrial activity expanded further across the US and Europe as they entered the new year.

Corporate releases will continue to be a dominant driver of market sentiment this week as Q4 earnings season continues apace. Key names in focus in the holiday-shortened week in the US include Johnson & Johnson, Procter & Gamble and Netflix. Releases from 3M, a bellwether for the broader US economy, and Intel will be closely watched, where investors will be keen to see whether strong demand for server CPUs driven by agentic AI can offset a more muted outlook for personal CPUs as PC unit demand falls. Overall, US earnings are expected to have climbed by 8.3% in Q4, marking the tenth straight quarter of YoY growth. Closer to home, Kenmare Resources and homebuilder Cairn Homes will provide trading updates, with the latter expected to deliver c. 10% more homes in 2025 at an increased gross margin. Other names of interest include miner Rio Tinto which is also expected to report increased copper production for the financial year, offsetting static iron ore and aluminium shipments and production.

This is an extract from the Weekly Markets Report by Cantor Fitzgerald Ireland. For more detail on individual securities, or to discuss how we can support your investment needs, please get in touch.

Written by John Mullane, CIO, Cantor Fitzgerald Ireland