Authored by Brian Quarmby via Cointelegraph,

OpenAI-linked token Worldcoin spiked 40% on Wednesday following a report that the artificial intelligence firm is working on a bot-free social media platform that requires “proof of personhood.”  

According to a Tuesday Forbes report citing sources familiar with the matter, OpenAI is aiming to develop a “humans-only platform” as a point of difference from other social media services on the market. 

Still in its early stages, sources state that a small team of around 10 people is building the platform to compete with X, and that it has reportedly been in development since early 2025, according to tech news outlet The Verge.

Forbes’ sources claimed that any “proof of personhood” would likely be verified via Apple’s Face ID or the World Orb eyeball scanner, which has also been utilized as part of World, the blockchain and crypto project co-founded by OpenAI CEO Sam Altman. 

The report coincided with a 40% price pump for Worldcoin to $0.63; however, the price has since pulled back to $0.54 at the time of writing, according to CoinGecko data.

Amid a broader crypto downturn in the latter half of 2025, WLD has had a grim price performance, down almost 70% over the past 12 months. 

The World Orb, which has seen criticism over its implications for personal data privacy, scans a person’s face and their iris to verify that they are a unique human. It is a key part of onboarding genuine users to the WorldCoin ecosystem and helps establish a World ID.  

Details are sparse on how the reported social media platform could be integrated with OpenAI’s suite of products or potentially with WLD. It is believed, however, that OpenAI’s ChatGPT will be integrated to help users create content such as videos or photos. 

Altman has previously criticized bot activity on X and other social media platforms. Back in September, he said the current social media experience in general felt “fake” due to the sheer number of bot-like posts and comments.  

Update (1220ET): As expected, Senate Democrats have just formally blocked a package of government funding bills from advancing.

Democrats voted in unison against a procedural motion to advance the funding package. The motion, which required 60 votes to prevail, failed 45-55.

Eight Republicans joined all Democrats in voting against it, including Senate Majority Leader John Thune (R-S.D.).

Thune was a late “no” vote and immediately entered a motion to reconsider the package to give him flexibility to bring it back to the floor soon. 

Democrats blocked the funding package, which includes six bills, because it includes funding for the Department of Homeland Security.

But with the government running out of money at the end of the day Friday, there is urgency to get a deal done to avert a partial shutdown.

The Hill reports that a source familiar with the discussions, said that while no agreement had been reached yet, the discussions were ongoing and moving in Democrats’ direction.

*  *  *

Senate Minority Leader Chuck Schumer and the White House are negotiating a framework to advance five of the six remaining fiscal 2026 funding bills, alongside a short-term measure to keep the Department of Homeland Security operating, according to Punchbowl News, citing people familiar with the discussions. The talks come as Congress once again barrels toward a potential government shutdown amid a volatile political fight over immigration enforcement.

Under the emerging framework, lawmakers would pass a temporary DHS funding patch to allow negotiations to continue over new limits on Immigration and Customs Enforcement and Customs and Border Protection as the agencies carry out President Donald Trump’s immigration crackdown. Senate Republican leaders have urged Democrats to approve all six outstanding spending bills, a position Schumer has declined to accept.

Even if Schumer and the White House reach an agreement, a funding lapse over the weekend appears likely. The House, which is scheduled to return Monday, would still need to approve both the five-bill spending package and the DHS stopgap measure.

Easy money?

Senate Democrats on Wednesday rallied around a set of proposed reforms aimed at DHS and ICE operations. The proposals would tighten warrant requirements, establish a uniform code of conduct for federal officers, prohibit agents from wearing masks and require the use of body cameras.

The negotiations reflect the political pressure facing the White House after a series of violent incidents involving federal agents. Border czar Tom Homan, who was dispatched by the administration to Minnesota to take over operations from Border Patrol commander Gregory Bovino, held a closely watched press conference today as officials seek to defuse tensions following two fatal shootings involving federal agents in recent weeks.

Those shootings have intensified scrutiny of DHS operations and pushed Congress closer to another funding standoff. Democrats have signaled a willingness to force a shutdown if their demands are not met, marking a sharp shift from their posture during earlier funding fights.

“I don’t like shutdowns,” said Sen. Angus King (I-ME), one of three members of the Democratic caucus who opposed the previous shutdown in a comment to Punchbowl. “But it was a matter of conscience. I didn’t want to be complicit with what these guys are doing.”

To Democrats, the current confrontation carries both moral and political stakes. Party leaders see an opportunity to extract concessions as they perceive the White House to be negotiating from a position of weakness and as some Senate Republicans acknowledge the need for changes at DHS.

At the same time, Democratic unity is not assured. During a private caucus call Wednesday night, some House Democrats questioned whether Senate leaders would hold firm, according to multiple people on the call. Others raised concerns about whether the proposed reforms would meaningfully rein in ICE’s conduct.

Some progressives have pushed for more sweeping action. Sen. Ed Markey (D-MA) told the outlet that Democrats should be using the moment to “defund and abolish” ICE.

The Senate is scheduled to hold its first procedural vote on the six-bill funding package at 11:30 a.m. To strip DHS funding from the broader package, Democrats would first need to provide votes to advance the legislation. Whether an agreement is reached before that vote remains uncertain.

The risks extend to both parties. House Republicans remain divided, and conservative members have warned they oppose reopening negotiations on DHS funding. Meanwhile, Senate Democrats are under pressure from their base to confront the administration forcefully, particularly following the fatal shooting of Alex Pretti in Minneapolis.

The White House has offered alternative paths for enacting DHS reforms, including executive actions or separate legislation. Democratic leaders have rejected those options, insisting the changes be written directly into the DHS appropriations bill. Unlike previous shutdown fights, Democrats have limited their demands to reforms they believe Republicans could realistically accept.

Still, GOP resistance remains strong. Sen. Markwayne Mullin (R-OK) said Republicans would not agree to provisions that impede enforcement of the administration’s immigration agenda.

“The American people wanted the president to enforce law and order,” Mullin said. “ICE is doing their job.”

By Benjamin Picton, Senior Market Strategist at Rabobank

The US Federal Reserve’s rate setting committee left the Fed Funds rate unchanged at 3.50-3.75% with the Statement noting that “economic activity has been expanding at a solid pace…the unemployment rate has shown some signs of stabilization. Inflation remains somewhat elevated.” The decision was taken by a 10-2 vote, with Trump appointee Stephen Miran and Fed Chair hopeful Christopher Waller both dissenting in favor of a 25bp cut. The Bank of Canada, also meeting to set policy rates, similarly opted to keep rates unchanged at 2.25%. Our full review of the FOMC decision is available here, and the BOC decision here.

2 and 10-year Treasury yields were little changed on the day and equities were mixed. Fed-dated OIS saw the market-implied future path of the Fed Funds rate lift by 2-4bps over the remainder of the year. The S&P500 closed virtually flat after briefly hitting 7000 intraday and the NASDAQ eked out a 0.24% gain. The dollar found some support after Treasury Secretary Scott Bessent told CNBC that the US was still committed to the strong dollar policy and was “absolutely not” intervening in currency markets to support the value of the Japanese Yen. USDJPY closed 0.79% higher on the day, but has resumed selling in early trade this morning.

In his press conference Powell reiterated that some recent data suggested that the labor market has stabilized, despite the very low rate of hiring in the USA. He also said that the outlook for economic activity had “clearly improved” since the last meeting, and that that would matter for labour demand and employment over time. Powell characterized the labor market as exhibiting weak demand but that this was offset by weak supply as labor force growth was constrained by lower immigration and labor force participation. This is a variation on the “no hire, no fire” meme.

When asked why he attended a Supreme Court hearing on Lisa Cook’s case and to respond to a comment by Scott Bessent that his attendance was “political” Powell declined to answer the latter and said that he believed that the court case was perhaps the most important in the Fed’s 113-year history. In that context, he said he believed it would be difficult to explain why he didn’t attend. Having clearly anticipated this line of questioning, he came armed with a precedent – pointing out that Paul Volcker similarly attended a Supreme Court hearing in 1985.

Powell also dead-batted questions about his January 11th press conference where he sensationally suggested that grand jury subpoenas issued by the Department of Justice were politically motivated, and also declined to answer questions on whether he would choose to remain a Fed Governor after his term as Chairman expires in May.

This was Powell at his most technocratic. With midterm elections looming later in the year, and the President poised to gain greater control of the FOMC from May onwards, Powell may have been keen to strike a blow for establishment views on formulaic policy making where monetary policy is adjusted according to a recipe (reaction function) with 2% inflation and maximum employment the desired outputs. Conversely, Miran’s decision to vote for a cut of only 25bp (after voting for 50 at the three previous meetings) might be interpreted as an attempt to lower the temperature between the White House and the central bank, before resuming hostilities later in the year when Powell is replaced as Chair.

Obviously, paint-by-numbers inflation targeting is the virtual antithesis of the administration’s view that monetary policy should work in concert with other tools to achieve the domestic and foreign policy goals of the United States. How can the US Dollar, capital markets or Fed swaplines be mobilized to support US interests if those tools are gatekept by independent technocrats pursuing a much narrower definition of the national interest? How can the flow of credit be effectively diverted to priority industries (semiconductors, energy, defence etc) while interest rates are set dispassionately and indiscriminately across the entire economy? As some administration figures may be happy to point out, that is not how things work in China.

Under such circumstances where the central bank cannot be brought to heel, it seems logical to expect increased subordination through fiscal dominance and other actions of the US Treasury to assert control over tools of monetary policy. Stablecoins is one such area that we have written about previously.

While rates and FX markets were focused on the Fed, gold and silver are again resetting all-time highs. Silver is up 1% at time of writing to $117.85/oz. Gold has busted through the $5500/oz level and has now risen more than $500/oz over the last four days. With Brent crude prices also up 0.56% to $68.78/bbl this morning, it would seem that geopolitics is again a major influence on these moves (along with the weaker dollar).

Donald Trump took to Truth Social overnight to warn Iran to “make a deal”. His post said that a “massive armada” led by the USS Abraham Lincoln was headed to the region – a fleet larger than the one deployed to the Caribbean to conduct operations again Venezuela – and that “the next attack will be far worse” than earlier US strikes on Iran’s nuclear facilities.

Clearly, the Iran issue is not going away and the price action in energy and metals is telling us that this is a market that will continue to move on geopolitical stimuli. Technocratic approaches to trading it based on economic variables like GDP, employment and inflation are much more risk-laden than they used to be.

Novo Nordisk shares in Europe appear to be forming a base after a 5.5-month bottoming process, following a mid-2024 peak and a subsequent 71% collapse.

Goldman analyst Faris Mourad is telling clients this week that “obesity drugs narrative sentiment is on the rise” and “it’s an opportunity to buy the dip.”

Mourad explained:

The relative performance of the Obesity Drugs basket (GSHLCBMI) to the S&P 500 (SPX) is lagging its narrative sentiment. The basket is down -2 standard deviations today and we think it’s a good opportunity to buy the dip.

We flagged the obesity drug theme yesterday: We like going long our global obesity drugs basket (GSHLCBMI) since it provides exposure to the leading companies (LLY and NVO) as well as potential emerging leaders in this space: market is moving beyond the dominance of a few key players, with new entrants and diverse therapeutic approaches intensifying competition. Large pharmaceutical companies are actively engaging in M&A and licensing deals to replenish pipelines and acquire next-generation obesity assets, as evidenced by Pfizer’s acquisition of Metsera and Roche’s deal with Zealand Pharma in late 2025.

We notice equity investors are also focused on the industries that could face challenges as obesity drugs become more popular. We consider a handful at risk: junk foods, alcohol, tobacco, and health care companies that may be impacted in the medical tech, tools, services, and managed care space. We created a basket that combines all: global unhealthy lifestyle (GSCBUHLT) that can trade $200m in one day at 10% of volume.

Our research team highlights 2026 as a pivotal year for the development of obesity market, with the launch of NVO’s Wegovy pill (approved by the FDA in late Dec25 and expected commercial rollout in early 2026) and Lilly’s Orforglipron (expected FDA approval in 2026), together with the initial unlock of the Medicare population, potentially significantly increasing the addressable population for obesity medications. We expect the focus in the first half of the year to be on the launch dynamics for the Wegovy pill and orforglipron, with sales estimates 25-35% ahead of company consensus for 2027-29. That being said: street consensus estimates show no changes to 2026 and 2027 revenues driven by Oral obesity drugs and the group traded below earnings expectations for the majority of the last year.

GS research is significantly ahead of consensus on the revenue potential of oral Wegovy:

Meanwhile street consensus estimates show no changes to 2026 and 2027 revenues driven by Oral obesity drugs:

Obesity drugs traded below earnings expectations for the majority of the last year:

Related:

• Novo Undercuts Lilly’s Obesity Drug Price, Now Cheaper Than Car Payment

• Medicare Secures 71% Price Cut On Novo’s Anti-Obesity Drug As Part Of Broad Affordability Push

• Novo Nordisk Plunges After Ozempic Pill Fails Alzheimer’s Trials – Shares Suffer Worst Year Ever

• Goldman, UBS React To Novo Nordisk Axing 9,000 Jobs, Slashing Guidance Amid GLP-1 Headwinds

• “Much-Needed Win”: Novo Shares Jump Most In Nearly Two Years After US Approval Of Wegovy Obesity Pill

Will 2026 be a rebound here for Novo?

Authored by William Murray via RealClearEnergy,

It can be hard to explain to a general audience how important the release of the World Energy Outlook (WEO) is to policymakers, energy companies and investors who make hundreds of billions of dollars in investment decisions worldwide each year.

Beginning in the early 1990s, the Outlook included a Current Policies Scenario (CPS) that forecast future oil and natural gas demand over the coming decades based on current laws and government energy policies. This scenario was then used by banks and companies to extrapolate how many billions of dollars they must invest to satisfy coming energy demand. 

The IEA’s all-star reputation made the CPS the benchmark for global energy supply and demand forecasts for decades – until recently. 

In 2020, under its long-time Executive Director Fatih Birol, the IEA decided to abandon the CPS, “in part due to pressure from European nations and green campaigners,” according to Bloomberg energy analyst Javier Blas. Most of these green campaigners were interested in using climate policies to permanently displace oil and coal production.

To do this, IEA inserted new scenarios that considered policy ambitions and aspirations that had not yet become law. This analytical misdirection allowed Paris Accord-era net-zero emission goals to become a concrete forecasting reality. As a result, these forecasts showed peak global oil demand only an additional 3 million to 106 million barrels a day by 2030 before permanently declining.

Riding on IEA’s reputation, these forecasts helped the Davos crowd churn elite public opinion toward the Net-zero and Environmental, Social, and Governance (ESG) framework in the early 2020s, which played a role in the ultimate suppression of billions of dollars in investment in carbon and hydrocarbon resources.

The IEA reinstated the Current Policies Scenario for 2025 after pressure from the Trump administration, while confirming that no peak in global oil demand should be expected until at least 2050. This is a welcome decision, but not before much damage was done, according to a recent report published by the National Center for Energy Analytics (NCEA). 

The report, written by Neil Atkinson, a NCEA Visiting Fellow and the former head of the IEA’s Oil Industry and Markets division, and Adam Sieminski, former administrator for the U.S. Energy Information Administration, found that while reinstatement of the CPS in the 2025 WEO “has gone a long way toward answering that its scenarios are divorced from reality,” the IEA must still do more to reverse past mistakes.

The latest critique found that the IEA is still making a series of unsupportable market assumptions, including:

Electric Vehicles: Forecasts of electric vehicle adoption remain overly optimistic, leading to overestimates of oil demand destruction for light-duty vehicles.

Aviation: A forecast for even a small reduction in aviation fuel use remains overly aggressive.

Marine shipping: The IEA continues to present overly aggressive forecasts of a significant decline in crude oil use for global oceangoing shipping.

Even if the IEA fixes its methodological problems and appoints a new Executive Director, damage from the five-year absence of the Current Policies Scenario could last for a long time. Sieminski and Atkinson estimate that as much as $1.5 trillion of underinvestment in oil and natural gas exploration is expected over the next decade. Underinvestment in the oil patch leads to supply shortfalls, which inevitably brings about a spike in energy prices and a new, much higher price plateau.

By projecting a 2030 demand peak for oil, the IEA sacrificed its credibility, giving succor and elite air cover to organizations like the Net-Zero Banking Alliance, a UN-backed group whose members topped out at 140 banks with trillions of dollars in assets, pledging to align their portfolios with net-zero greenhouse gas emissions by 2050.

It is unknown exactly how much international investment banks withdrew from funding Arctic oil and coal resources, but many went on the record saying they did. The collapse of the Banking Alliance in the fall of 2025, driven by a combination of political pressure and market realities, will not make up for the consequences of a self-inflicted, years-long supply-demand lag.

The report’s authors do not go so far as to directly accuse the IEA of sneakily undermining the investment climate enough to create future recession-causing price spikes, but energy experts know that similar production shortfalls in the past have done exactly that. 

In the 1970s, a barrel of oil went from $4 to a new plateau of about $32 a barrel by 1981, a seven-fold rise in the nominal price that crashed many national economies. In the super-spike era between 2004 and 2013, long-term oil prices roughly tripled while playing an underappreciated supporting role in the 2008 Global Financial Crisis. 

If another major upward price correction arrives in the coming years, don’t forget to include the IEA’s willful errors when making a list of perpetrators. All government institutions are political, no matter how much structure is insulated from direct influence. Let’s hope the IEA has learned a lesson or two about the costs of believing there is a “right side of history” to be on.

William Murray is a former chief speechwriter for the Environmental Protection Agency (EPA), the past editor of RealClearEnergy from 2015-2017, and has covered energy and environmental policy in Washington D.C., as a journalist and analyst for the past two decades.

Authored by Aldgra Fredly via The Epoch Times (emphasis ours),

President Donald Trump announced on Jan. 27 that farm equipment maker John Deere will invest $70 million to build an excavator factory in North Carolina.

“It’s brand new, the best in the world. And I think it’s going to pay off very, very big,” the president said during an event in Iowa. “We don’t make them here. This is going to be the only excavator entirely made in the United States of America.”

The White House later said in a post on X that John Deere will build two new factories in the United States, including one in North Carolina that will help “move excavator production BACK to America.”

The second factory is a state-of-the-art distribution center, which will be built near Hebron, Indiana, the company said in a Jan. 27 statement. Both facilities are expected to open next year, it said.

John Deere said the North Carolina plant will manufacture excavators previously produced in Japan and will employ more than 150 workers when it opens.

The company said that it has broken ground on the Indiana project, a facility designed to streamline John Deere’s operations and ensure the timely delivery of equipment and parts. The project is expected to generate about 150 jobs, it added.

“Our investment in these new facilities underscores John Deere’s dedication to strengthening the backbone of American industry and supporting local economies,” John Deere CEO John May said. “We believe in building America, and these projects represent our intent to continue driving innovation and job creation in the United States.”

John Deere said last year that it would invest $20 billion in the United States over the next decade, calling it “a powerful signal” of its long-term commitment to building and growing domestically.

The company also made clear that it has no plans to shut down domestic manufacturing.

Texas Agriculture Commissioner Sid Miller welcomed the move on Jan. 27 and expressed hope that John Deere would choose Texas as the site to build its next factory.

“I applaud President Donald J. Trump for standing up for American workers and bringing manufacturing back home. John Deere’s decision to build new factories in the United States is a win for our economy, our workforce, and our national security,” Miller said in a post on Facebook.

“This is the kind of leadership that puts America first and rebuilds our industrial strength. Now let’s keep that momentum going and make sure the next one is built right here in Texas.”

By Charles Kennedy of OilPrice.com

Brent Crude prices topped $70 per barrel – and $71 shortly after – early on Thursday for the first time since September, as U.S. President Donald Trump warned Iran that a “massive armada” of U.S. Navy ships is headed to the Persian Gulf. 

At the time of writing, Brent Crude prices had jumped by 3.38% at $70.71. This was the highest in more than five months and the first time the international benchmark has topped $70 per barrel since early August. The U.S. benchmark, WTI Crude, was also trading higher, up by 3.51% to $65.43. WTI topped $65 per barrel for the first time since September. 

After a week or so of relative calmness in the U.S. rhetoric toward Iran, which continued to brutally suppress mass protests, President Trump warned the Islamic Republic of a Venezuela-style “mission,” at least this is what the President suggested in a post on his Truth Social platform.

“A massive Armada is heading to Iran. It is moving quickly, with great power, enthusiasm, and purpose,” President Trump posted.

“It is a larger fleet, headed by the great Aircraft Carrier Abraham Lincoln, than that sent to Venezuela. Like with Venezuela, it is, ready, willing, and able to rapidly fulfill its mission, with speed and violence, if necessary,” the President continued.

He urged Iran “to make a deal” pledging “NO NUCLEAR WEAPONS,” otherwise, President Trump said, “The next attack will be far worse! Don’t make that happen again.”

Markets reacted to the renewed tension in the world’s most important oil-producing and exporting region, and oil and gold soared.

Iran, for its part, said that its army is ready to “immediately and powerfully” respond to any possible attack by the United States.

“Our brave Armed Forces are prepared—with their fingers on the trigger—to immediately and powerfully respond to ANY aggression against our beloved land, air, and sea,” Iran’s Foreign Minister Abbas Araghchi posted on X.

If Trump tries to enforce a blockade, Iran will retaliate using asymmetrical means.

The Houthis caused havoc for global trade by hitting just 30 vessels over two years. Iranian attacks on merchant vessels in the Persian Gulf will have far greater impact.https://t.co/oLKvUzFrVd

— Esfandyar Batmanghelidj (@yarbatman) January 28, 2026

Commenting on the latest flare-up in the Middle East, ING commodities strategists Warren Patterson and Ewa Manthey said on Thursday, “Clearly, this more aggressive rhetoric has left the oil market nervous about the potential for supply disruptions.”

Authored by Kimberley Hayek via The Epoch Times,

Technical discussions between the United States, Denmark, and Greenland on improving Arctic security have begun, Secretary of State Marco Rubio said Wednesday.

The talks originate from a working group created earlier this month during a Washington meeting including Rubio, Vice President JD Vance, and the foreign ministers of Denmark and Greenland.

“It begins today and it will be a regular process,” Rubio told the Senate Foreign Relations Committee. “We’re going to try to do it in a way that isn’t like a media circus every time these conversations happen, because we think that creates more flexibility on both sides to arrive at a positive outcome.”

“We’ve got a little bit of work to do, but I think we’re going to wind up in a good place, and I think you’ll hear the same from our colleagues in Europe very shortly,” Rubio said.

The initiative comes after President Donald Trump has said that the United States must secure Greenland to increase national security against Russia and China. European allies have rebuked Trump’s approach.

Trump recently threatened tariffs on Denmark and other European nations opposing his Greenland overtures before brokering a preliminary framework with NATO Secretary-General Mark Rutte.

At the World Economic Forum in Davos, Switzerland, last week, Trump said no military force would be used for acquiring the island, stating, “I don’t have to use force. I don’t want to use force. I won’t use force.”

Trump has portrayed the deal as providing total access to Greenland without payment or time limits, underscoring the Golden Dome missile defense system.

“There’s no end, there’s no time limit,” he said, adding, “We’re not doing a 99-year or a 10-year [deal] or anything else.”

The president assigned Rubio, Vance, and special envoy Steve Witkoff to work on the negotiations.

NATO has highlighted the framework’s goal of preventing Russia and China from establishing economic or military footholds on the island.

Alliance spokesperson Allison Hart noted discussions among Arctic member states to bolster collective security, stating that talks with Denmark and Greenland strive to deter adversaries.

“We need to defend the Arctic,” Rutte said at Davos.

Greenland lies along key missile trajectories, vast mineral resources, and emerging shipping routes.

The United States maintains Pituffik Space Force Base there, where it has situated early-warning radars.

Russia oversees extensive Arctic infrastructure, such as dozens of bases and icebreakers.

Russia’s robust Arctic infrastructure poses a direct challenge, with more than 50 revitalized Soviet-era installations, including six army bases, 10 radar stations, and more than 60 icebreakers—far outpacing the United States’ two.

“It is important to consistently strengthen Russia’s positions in the Arctic, comprehensively develop our country’s logistics capabilities, and ensure the development of a promising Arctic transport corridor from St. Petersburg to Vladivostok,” Russian President Vladimir Putin said in November 2025.

China, meanwhile, pursues a “Polar Silk Road” for influence through investments in infrastructure and resources, according to a 2024 RAND Corporation analysis.

Eric Cole, a former CIA officer and CEO of Secure Anchor, described Greenland as a “forward lookout post for the entire North Atlantic security architecture.”

“Greenland’s geographic position places it directly beneath the shortest flight paths between North America, Europe, and Eurasia, making it a natural vantage point for monitoring air and missile activity,” Cole told The Epoch Times.

“Sensors based in Greenland can track aircraft, space objects, and missile launches that would otherwise go undetected until much later in their trajectory. This early detection is critical for both U.S. and NATO forces, as it expands warning times and improves coordinated response options.”

Senate Minority Leader Chuck Schumer and the White House are negotiating a framework to advance five of the six remaining fiscal 2026 funding bills, alongside a short-term measure to keep the Department of Homeland Security operating, according to Punchbowl News, citing people familiar with the discussions. The talks come as Congress once again barrels toward a potential government shutdown amid a volatile political fight over immigration enforcement.

Under the emerging framework, lawmakers would pass a temporary DHS funding patch to allow negotiations to continue over new limits on Immigration and Customs Enforcement and Customs and Border Protection as the agencies carry out President Donald Trump’s immigration crackdown. Senate Republican leaders have urged Democrats to approve all six outstanding spending bills, a position Schumer has declined to accept.

Even if Schumer and the White House reach an agreement, a funding lapse over the weekend appears likely. The House, which is scheduled to return Monday, would still need to approve both the five-bill spending package and the DHS stopgap measure.

Easy money?

Senate Democrats on Wednesday rallied around a set of proposed reforms aimed at DHS and ICE operations. The proposals would tighten warrant requirements, establish a uniform code of conduct for federal officers, prohibit agents from wearing masks and require the use of body cameras.

The negotiations reflect the political pressure facing the White House after a series of violent incidents involving federal agents. Border czar Tom Homan, who was dispatched by the administration to Minnesota to take over operations from Border Patrol commander Gregory Bovino, held a closely watched press conference today as officials seek to defuse tensions following two fatal shootings involving federal agents in recent weeks.

Those shootings have intensified scrutiny of DHS operations and pushed Congress closer to another funding standoff. Democrats have signaled a willingness to force a shutdown if their demands are not met, marking a sharp shift from their posture during earlier funding fights.

“I don’t like shutdowns,” said Sen. Angus King (I-ME), one of three members of the Democratic caucus who opposed the previous shutdown in a comment to Punchbowl. “But it was a matter of conscience. I didn’t want to be complicit with what these guys are doing.”

To Democrats, the current confrontation carries both moral and political stakes. Party leaders see an opportunity to extract concessions as they perceive the White House to be negotiating from a position of weakness and as some Senate Republicans acknowledge the need for changes at DHS.

At the same time, Democratic unity is not assured. During a private caucus call Wednesday night, some House Democrats questioned whether Senate leaders would hold firm, according to multiple people on the call. Others raised concerns about whether the proposed reforms would meaningfully rein in ICE’s conduct.

Some progressives have pushed for more sweeping action. Sen. Ed Markey (D-MA) told the outlet that Democrats should be using the moment to “defund and abolish” ICE.

The Senate is scheduled to hold its first procedural vote on the six-bill funding package at 11:30 a.m. To strip DHS funding from the broader package, Democrats would first need to provide votes to advance the legislation. Whether an agreement is reached before that vote remains uncertain.

The risks extend to both parties. House Republicans remain divided, and conservative members have warned they oppose reopening negotiations on DHS funding. Meanwhile, Senate Democrats are under pressure from their base to confront the administration forcefully, particularly following the fatal shooting of Alex Pretti in Minneapolis.

The White House has offered alternative paths for enacting DHS reforms, including executive actions or separate legislation. Democratic leaders have rejected those options, insisting the changes be written directly into the DHS appropriations bill. Unlike previous shutdown fights, Democrats have limited their demands to reforms they believe Republicans could realistically accept.

Still, GOP resistance remains strong. Sen. Markwayne Mullin (R-OK) said Republicans would not agree to provisions that impede enforcement of the administration’s immigration agenda.

“The American people wanted the president to enforce law and order,” Mullin said. “ICE is doing their job.”

Futures are higher, led by tech, after the first batch of Mag7 earnings with gold breaking new record highs again, rising as high as $5600. As of 8:00am ET, S&P futures are up 0.2% while the Nasdaq if barely in the green; pre-mkt it’s a mixed picture with META (+7.9%) rising on higher than expected capex forecast, while MSFT (-6.6%) tumbles on… higher than expected capex forecast; TSLA is also modestly in the green, up +2.8%; AAPL reports today today then AMZN / GOOG next week. Cyclicals are trading higher led by Energy and Industrials and the AI theme also acting well as capex / fundamentals remain supportive of growth. The yield curve is twisting steeper with the USD flat. Commodities remain bid across all 3 complexes with WTI (Iranian supply fears) and precious (fiat incineration trade) the most notable. Today’s macro data focus is on jobless claims though given Powell’s comments yesterday, Friday’s PPI is more important.

In premarket trading, Mag 7 stocks are mixed: Meta (META) rises 8% after the Facebook parent gave a revenue outlook that was much stronger than expected, which helped offset the surge in projected capex; Microsoft (MSFT) falls 6% after the software giant’s report featured an underwhelming read on growth in its Azure cloud-computing business. Analysts also noted higher-than-expected expenses. Tesla (TSLA) gains 2% after the electric-vehicle giant reported adjusted earnings per share for the fourth quarter that topped the average analyst estimate. The company also announced a $2 billion investment in xAI and provided updates on its physical AI ventures (Nvidia (NVDA) -0.2%, Apple (AAPL) +0.5%, Amazon (AMZN) -0.3%, Alphabet (GOOGL) +1.7%)

• Rare earth stocks fall sharply after a report from Reuters said the Trump administration is backing away from plans to guarantee a minimum price for critical minerals projects, citing multiple sources. MP Materials has since refuted the report
• Celestica (CLS) falls 5% after the company reported its fourth-quarter results and gave an outlook. While the results were better than expected, analysts noted higher capex as a potential reason behind the stock’s decline.
• CH Robinson (CHRW) rises 5% after the logistics company reported adjusted earnings per share that beat analyst estimates, despite macroeconomic headwinds from global trade policies.
• Dow Inc. (DOW) slips 2% as the chemical company said it will terminate about 4,500 roles as part of a plan to simplify and streamline its end-to-end processes. It also reported net sales for the fourth quarter that were in-line with the average analyst estimate.
• International Business Machines (IBM) gains 9% after the IT services company reported fourth-quarter results that beat expectations. Analysts highlighted software revenue and free cash flow as positive.
• International Paper Co. (IP) rises 5% on plans to break up and spin off its European packaging operations.
• Las Vegas Sands (LVS) drops 10% after the casino operator’s Macau properties — including The Venetian and Londoner — fell short of Wall Street’s expectations.
• LendingClub (LC) falls 7% after posting fourth quarter results. BI analyst Herman Chan writes that pre-provision profit missed slightly amid higher marketing expenses and guidance looks somewhat lighter than market expectations.
• ServiceNow (NOW) is down 8% after the software company reported its fourth-quarter results and gave an outlook. Analysts are broadly positive, but Bloomberg Intelligence noted that the backdrop remains uncertain.
• Southwest Airlines (LUV) rises 5% after reporting results that topped analyst estimates, signaling the fruits of a turnaround. Shares are climbing 6.2%.
• VSE Corp. (VSEC) rises 1% after agreeing to buy closely held Precision Aviation Group for about $2.025 billion in a cash-and-stock deal.
• Whirlpool (WHR) falls 11% after the appliance maker’s ongoing earnings-per-share forecast for the full year trailed the average analyst estimate. US levies on imports have yet to give the company an edge over foreign rivals, its chief executive said.

Big tech is back in focus, with markets rewarding AI-heavy capex when it’s paired with stronger-than-expected core business growth, as seen at Meta, or punishing it when momentum disappoints, as Microsoft found out the hard way. 

Meta’s stronger-than-expected revenue outlook helped cushion concerns over rising AI-related spending. The social media giant reported fourth-quarter sales of $59.9 billion, beating the $58.4 billion that Wall Street anticipated.  t signaled that while spending is up, the core business supporting those investments is also growing faster than expected. If Meta hits the top-end of capex guidance for 2026, it will mean a jump of roughly 87% from 2025.

Microsoft’s record spending and slower cloud growth sent its shares down sharply amid investor concerns that it could take longer than expected for the company’s AI investments to pay off. Capex for fiscal second quarter hit $37.5 billion, up 66% from a year earlier and exceeding analyst estimates for $36.2 billion. The Azure cloud-computing unit posted a 38% revenue gain when adjusting for currency fluctuations, just meeting analyst projections.

“We’re back to the theme that we’re not seeing monolithic growth for all the tech companies,” said Rory McPherson, chief investment officer at Magnus Financial Discretionary Management. “Capex spending has increased across the board. The market is just rewarding the ability to monetize it, while placing question marks on companies that aren’t able to do that.”

Looking at earnings, out of the 119 S&P 500 companies that have reported so far in the earnings season, 77% have managed to beat analyst forecasts, while 16% have missed. Caterpillar, Dow and Honeywell International are among many companies expected to report results before the market opens. Caterpillar’s revenue is set to accelerate in 4Q, largely driven by higher volume across all segments, as momentum continues to build into 2026. Margin pressure is likely to persist in 4Q due to a step-up in tariffs (about a $725 million headwind) and manufacturing costs. Earnings from Apple, KLA and Stryker and follow later in the day.

The Stoxx 600 rises 0.4%, with mining, energy and industrial shares leading gains. Technology stocks underperform with Germany’s SAP plunging as much as 13% after reporting a disappointing cloud backlog. Meanwhile, miners outperform. Here are the biggest movers Thursday:

• 3i Group shares rise as much as 15% in London, rebounding from a recent plunge, after the investment firm’s latest results showed a better-than-expected performance for its discount retail business, Action
• ABB rises as much as 9.8% after the Swiss firm predicted higher profitability this year amid a boom in data centers and also announced a $2 billion share buyback. JPMorgan describes orders in the electrical and automation divisions as “blowout”
• STMicro shares rise as much as 5% after the chipmaker gave a better-than-expected 1Q revenue forecast, showing signs of cyclical recovery in demand for analog chips
• EssilorLuxottica shares climb as much as 2.5%, snapping four days of declines. Meta CEO Mark Zuckerberg on an earnings call said it’s “hard to imagine a world in several years where most glasses that people wear aren’t AI glasses”
• European mining shares are the best-performers on the Stoxx 600 benchmark on Thursday after copper posted its biggest one-day gain in years to hit a record above $14,000 a ton
• EasyJet shares rise as much as 3.1% after the airline reported solid first-quarter results and left its outlook for fiscal year 2026 broadly unchanged
• SAP shares drop as much as 13%, the biggest intraday decline in more than five years, after the software firm reported 25% growth in current cloud backlog on constant-currency basis
• H&M shares drop as much as 4.3% after the fashion retailer reported softer current trading than expected, with RBC saying 4Q sales are “a little light” vs. consensus estimates
• Nokia declines as much as 7.4% after the Finnish communications group reported its latest earnings. Analysts say the backwards-looking figures in the report are strong, but 2026 guidance for Network Infrastructure is disappointing
• Givaudan drops as much as 6.7% to the lowest since Oct. 2023 after the Swiss fragrance and flavor maker delivered a weak like-for-like performance in the fourth quarter
• SEB falls as much as 5.7%, the most since April 2025, after the Swedish lender reported its latest earnings, which analysts describe as weak, with a large miss on profits the key disappointment, overshadowing better-than-expected dividends
• Roche shares drop as much as 2.1% after the Swiss drugmaker reported results for the fourth quarter which Intron Health analysts called “soft.” The company also provided guidance for 2026, and analysts see potential for consensus expectations to be cut as a result
• Interroll shares fall as much as 9.6%, the most since last April, after the Swiss industrial-equipment firm’s full-year sales undershot the average analyst estimate. Analysts see some bright spots in the report but highlight headwinds
• Hilton Foods shares drop as much as 9.2%, the most in two months, after the meat producer issued a cautious outlook as inflationary pressures in beef and white fish continue

Earlier in the session, Asian equities edged higher amid mixed trading in heavyweight tech names. Shares in Indonesia pared losses. The MSCI Asia Pacific Index was up 0.2%, after falling as much as 0.7%. SK Hynix and Japan’s Advantest, which surged after its earnings beat, were the biggest boosts to the gauge, while TSMC, Tokyo Electron and Samsung weighed the most. The Indonesian benchmark plunged for a second day, before trimming most of the losses, as investors continue to fret over MSCI’s warning over the market’s investability. The index tumbled as much as 10% before closing 1.1% lower as local regulators said they would double the minimum free-float requirement starting next month.

In FX, the Bloomberg Dollar Spot Index is little changed having erased an earlier fall. The greenback has struggled this year as investors bet on its long-term decline, with unpredictable policymaking and ballooning deficits adding to its woes. The dollar hasn’t acted like a haven for some time as investors increasingly favor tangible alternatives such as precious metals, DoubleLine Capital Chief Executive Officer Jeffrey Gundlach told CNBC.

“The risks of another major leg lower in the dollar remain elevated, even if our bias is for a short-term recovery, given the overall supporting macro and rates picture,” wrote strategists at ING Groep NV including Francesco Pesole.

In rates, treasuries are steady, with US 10-year yields near flat at 4.25%. European government bonds are also little changed.

In commodities, Brent crude futures hit $70 a barrel for the first time since September after US President Trump warned Iran to make a nuclear deal with the US or face military strikes far worse than the attack he ordered last June.

Copper surged by the most in more than 16 years, surging about 6% and earlier hitting a record above $14,000 a ton as metals extended a dramatic start to the year, fueled by a wave of intense speculative trading in China. Spot gold also crossed $5,500/oz for the first while silver briefly surpassed $120/oz, extending its year-to-date advance to around 63%.

“We still have some exposure to gold but at these prices I wouldn’t be that long on it,” said Dan Boardman-Weston, chief investment officer at BRI Wealth Management. “You need it for diversification and it’s been wonderful over the past two years, but now I’m minding my exposure to it.”

The US economic calendar includes 3Q final nonfarm productivity and unit labor costs, weekly jobless claims and November trade balance (8:30am), November factory orders and wholesale trade sales (10am)

Market Snapshot

• S&P 500 mini +0.2%
• Nasdaq 100 mini +0.3%
• Russell 2000 mini +0.2%
• Stoxx Europe 600 +0.4%
• DAX -1%
• CAC 40 +0.6%
• 10-year Treasury yield +1 basis point at 4.25%
• VIX +0.1 points at 16.45
• Bloomberg Dollar Index little changed at 1178.44
• euro little changed at $1.1955
• WTI crude +2.1% at $64.53/barrel

Top Overnight News

• Talks between top Senate Democrats and the Trump administration to avert a government shutdown have moved closer to Democrats’ demands, though no deal has been reached yet, a person familiar said. Talks included restrictions on ICE agents. BBG
• US Senate Majority Leader Thune sees a possibility to avoid a shutdown by week’s end after Senate Minority Leader Schumer lays out Democrats’ demands on ICE: CNN
• President Trump is weighing options against Iran that include targeted strikes on security forces and leaders to inspire protesters, multiple sources said, even as Israeli and Arab officials said air power alone would not topple the clerical rulers. RTRS
• Nvidia, Microsoft and Amazon may invest up to $60 billion in OpenAI’s new funding round. The Information
• Nvidia Corp. hasn’t yet received any orders from Chinese customers for its H200 AI chips as Beijing is still deciding whether to allow imports of the US firm’s components, according to Jensen Huang. BBG
• Cuba only has enough oil to last 15-20 days at current levels of demand and domestic production after its sole supplier Mexico appeared to cancel a shipment while the US blocked deliveries from Venezuela. FT
• Chairman of a US House of Representatives committee said in a letter that NVIDIA (NVDA) helped DeepSeek hone AI models later used in China’s military: Reuters.
• Gold and silver hit new records, lifting commodities as a weaker dollar and geopolitical tensions fueled demand. Copper surged on speculative trading in China. Brent hit $70 a barrel after Donald Trump renewed threats against Iran. BBG
• Shares in Chinese property developers surge on news that China has done away with borrowing limits on property developers known as its “three red lines” policy, an apparent end to rules that triggered a debt crisis which continues to weigh on the world’s second-largest economy. RTRS
• Indonesia’s stock market suffered its worst two-day rout since 1998, triggered by MSCI’s warning of a possible market downgrade due to transparency concerns. Regulators stepped in and announced plans to double the minimum free-float requirements. BBG
• Sweden’s central bank held its key rate at a three-year low of 1.75%, as expected, and stuck with its forecast for no change until next year. BBG
• Regional banks are on track to outperform the S&P 500 for a third month, the longest streak since 2022. With valuation multiples still below their long-term average and 10% of an S&P gauge set to disclose results in the next two days, the door is open to more gains if profits come in strong.
   

Notable earnings

• Tesla Inc. (TSLA) Q4 2025 (USD): Adj. EPS 0.50 (exp. 0.45), Revenue 24.9bln (exp. 24.77bln). Gross margin 20.1% (exp. 17.1%). Operating income 1.41bln (exp. 1.32bln). Free cash flow 1.42bln (exp. 1.59bln). In Q1 of this year, we plan to unveil the Gen 3 version of Optimus. Plan to begin megapack 3 and megablock production at megafactory Houston in 2026. On Jan 16, agreed to invest ~2B to acquire shares of Series E Preferred stock of xAI. Shares +3% pre-market
• Microsoft Corporation (MSFT) Q2 2025 (USD): EPS 5.16 (exp. 3.92), Revenue 81.3bln (exp. 80.28bln). said net gains from OpenAI investments totaled USD 7.6bln, which resulted in an increase in diluted earnings per share of USD 1.02/shr. Operating income 38.3bln (exp. 32.9bln). SEGMENTS:. Q2 Azure and other Cloud services revenue increased 39% (exp. 38.8%). Productivity and Business +16% at USD 34.1bln (exp. 33.5bln). More Personal Computing: USD 14.3bln (exp. 14.33bln). Cloud revenue +26% to USD 51.5bln. Intelligent cloud revenue USD 32.9bln. Commercial RPO +110% to USD 625bln. Shares -6.4% pre-market
• Meta Platforms Inc (META) Q4 2025 (USD) EPS 8.88 (exp. 8.19), Revenue 59.9bln (exp. 58.38bln). Sees Q1 rev. USD 53.5bln-56.5bln (exp. 51.3bln). Sees 2026 capex USD 115bln-135bln (exp. 110.6bln). Shares +7.9% pre-market
• International Business Machines Corporation (IBM) Q4 (USD) Adj. EPS 4.52 (exp. 4.33), Revenue 19.7bln (exp. 19.21bln). Sees FY constant currency rev. growth of over 5%. Sees FY2026 revenue USD 70.14bln (exp. 70.16bln). Sees FY free cash flow to increase by about USD 1bln. Shares +8.2% pre-market
• SAP (SAP GY) Q4 2025 (EUR): Adj. oper. profit 2.83bln (exp. 2.75bln), Revenue 9.68bln (exp. 9.74bln), Cloud Revenue 5.61bln (exp. 5.64bln), Cloud/Software Revenue 8.62bln (exp. 8.68bln); announced up to EUR 10bln buyback, to start Feb 2026. Shares -14%

Trade/Tariffs

• China’s MOFCOM spokesperson, when asked about a potential round of US-China trade talks, said China is willing to work with the US side to jointly uphold and implement the important consensus of the two heads of state, Global Times reported.
• Chinese President Xi said they are willing to consider implementing a unilateral visa-free system for British nationals

Central Banks

• Riksbank leaves its policy rate unchanged at 1.75% as expected; reiterates that the policy rate is expected to remain at this level for some time to come, in line with the forecast in December.
• BoK said uncertainty surrounding US monetary policy is likely to persist and it reiterated it will closely monitor financial markets.
• HKMA maintains its base rate at 4.00%, as expected.
• Monetary Authority of Singapore kept the prevailing rate of appreciation of the SGD NEER policy band, as well as made no change to the width and level the band is centred, as expected. said:. Output gap will be positive for the year as a whole. Growth this year is expected to remain resilient. Expects 2026 GDP growth to ease Y/Y.
• Brazilian BCB Policy Announcement 15% vs. Exp. 15.00% (Prev. 15.00%); said it will start cutting rates next meeting.

A more detailed look at global markets courtesy of Newsquawk

APAC stocks were mostly subdued with sentiment in the region clouded following a lack of fireworks at the FOMC, where the Fed kept rates unchanged at 3.50%-3.75%, as expected, while top- and bottom-line earnings beats from the likes of Meta, Microsoft and Tesla also failed to spur the broader risk appetite. ASX 200 marginally declined amid underperformance in telecoms and miners, while a surge in exports and import prices added to the inflationary risks and the case for an RBA rate hike next week. Nikkei 225 swung between gains and losses amid currency-related headwinds and earnings results. KOSPI saw two-way price action amid fluctuations in tech heavyweights Samsung Electronics and SK Hynix despite both companies posting stellar earnings results. Hang Seng and Shanghai Comp were mixed with price action relatively flat amid a lack of fresh pertinent macro catalysts for China, although property names were supported after reports that several developers are no longer required to submit the monthly “three red lines” indicators, which are debt metrics introduced in 2021 to curb builders’ financial leverage.

Top Asian News

• India’s Economic Survey has FY27 growth in a 6.8-7.2% range. Weaker INR causes investors to pause.
• China market liquidity will remain ample in February, according to analysts cited by China Securities Times.
• Google (GOOG) took action against a Chinese company linked to a massive cyber weapon.

European bourses (STOXX 600 +0.4%) are broadly firmer, but with clear underperformance in the DAX 40 (-1.2%), which has been dragged down by post-earnings losses in SAP (-14%). The software giant disappointed on cloud revenue and poor cloud backlog metrics. European sectors are mixed; Basic Resources is the clear outperformer, boosted by continued strength in underlying metals prices and following Glencore (+3%) and Antofagasta (+6%) releasing their FY26 copper production guidance, with both companies indicating strong production throughout the year. Among underperformers, Chemicals has been pressured by Givaudan (-6%) post-earnings, followed closely by Tech, dragged lower by losses in SAP.

Top European News

• Germany’s Chancellor Merz said they are now seeing the first signs of recovery in the German economy.
• French Finance Minister Lescure said recent FX moves reflect fundamentals.
• Chinese President Xi said to UK PM Starmer that the UK-China relationship in recent years had seen “twists and turns that did not serve the interests of our countries”. said:. China stands ready to develop with the UK a long-term and consistent strategic partnership . More dialogue between the UK and China was “imperative”.

FX

• DXY resides in a current 96.01–96.35 range, well within yesterday’s 95.859–96.787 parameter, with little movement seen following the FOMC decision and press conference yesterday. There was a lack of major surprises or fireworks from the meeting and presser, although Powell noted that rates are at the higher end of the neutral range, and that if the tariff effect on goods pricing is seen to peak this year, it would signal to the Fed that it can loosen policy. Looking ahead stateside, US initial jobless claims for the week of 24 January are expected at 205k (prev. 200k), while continuing claims (week of 17 January, coinciding with the BLS’ traditional survey window for the January jobs report) are seen at 1.86mln (prev. 1.849mln). The Chicago Fed’s Labour Market Indicators are also due today. Final Q3 unit labour costs data are also scheduled, alongside US trade data for November and factory orders for November.
• EUR/USD remains sub-1.2000 after finding some resistance at 1.1996 overnight, while still remaining within yesterday’s 1.1896–1.2045 range. There has been little of note for the EUR as participants gear up for next week’s ECB meeting, with some focus on Governing Council commentary. Aside from that, price action this morning has been largely USD-driven. GBP/USD found resistance near yesterday’s high (1.3846) before waning, with the pair remaining within yesterday’s parameter.
• USD/JPY is softer and back below its 100-DMA (153.71), trading within a 152.76–153.46 band, with price action largely in tandem with the USD in the absence of fresh macro drivers. Traders will be keeping an eye on the geopolitical landscape amid further punchy rhetoric from both Iran and the US. Domestically, a Nikkei poll showed that Japanese PM Takaichi’s party is expected to gain a Lower House majority.
• Antipodeans outperform, with AUD outpacing peers as the commodity-linked currency benefits from the surge in spot gold and copper prices, despite a lack of obvious drivers for the magnitude of gains seen. Data from Australia also showed firmer export and import prices.

Fixed Income

• USTs are, once again, near enough flat, holding off lows in the 111-16+ to 111-26 range. Post-FOMC updates have been light. In brief, the Fed held policy in a decision that saw two dovish dissenters (Miran and Waller), while the statement outlined a more optimistic outlook on the economy and labour market. Overall, the statement and presser left the Fed narrative largely unchanged, although the omission of the line referring to “downside risks to employment” lent a slight hawkish tint to the statement—a point reflected at the time in upside pressure at the short end of the yield curve. This morning, yields are bid across the curve, which is marginally steeper, with the 10yr back above 4.25%, though still shy of last week’s JGB-induced 4.31% YTD peak.
• EGBs were flat this morning, but have gradually edged higher to a peak around the 128.13 area, with gains of up to 10 ticks. Earnings are once again dominating the European newsflow, with the DAX 40 underperforming on account of SAP, though Bunds themselves do not appear to be reacting.
• Gilts gapped lower by just over 10 ticks before slipping to a 90.48 trough, catching up with the modest pressure seen in peers overnight. In the UK, the PM’s meeting with Chinese President Xi generated mixed commentary. A 2028 tender auction attracted strong demand, but had little impact on UK paper.
• Italy sold EUR 6.5bln vs exp. EUR 6-6.5bln 2.85% 2031, 3.45% 2036 BTP & EUR 2.0bln vs exp. EUR 1.5-2.0bln 1.468% 2035 CCTeu.
• UK sold GBP 1.25bln 0.125% 2028 Gilt auction via Tender: b/c 3.77x (prev. 3.84x), average yield 3.443% (prev. 3.783%).

Commodities

• Crude benchmarks have steadily moved higher and reached new four-month highs, with Brent Apr’26 climbing above USD 69/bbl as the probability of a US strike on Iran rises. CNN reported late on Wednesday, citing sources, that US President Trump is considering a new large-scale attack on Iran due to a lack of progress on a nuclear deal. More recently, Kpler’s Bakr reported that Trump is not looking for a war, but instead wants a diplomatic win or an “organic” internal uprising.
• Worries over oil and gas production due to the Arctic storm have subsided for now, with Henry Hub futures consolidating below USD 4/MMBtu after peaking at USD 7.43/MMBtu earlier in the week.
• Precious metals continue their surge higher, with spot XAU topping out just shy of USD 5,600/oz, aided by a weaker dollar following the FOMC policy announcement. Alongside gold, spot silver also peaked at a new ATH of USD 120.43/oz but is currently underperforming the yellow metal. This runs contrary to recent trends, where spot silver has typically led gains. UBS notes that reduced inflows into ETFs and net speculative futures positioning on the US COMEX exchange hint at a possible end to the rally in XAG.
• Copper prices surged at the start of Asia-Pac trade, with 3M LME copper breaking its prior ATH of USD 13.41k/t to reach a new peak of USD 14.12k/t. Despite the lack of a clear near-term driver, expectations for stronger US growth and increased build-out of AI infrastructure remain key supports for the red metal. This move also comes ahead of China’s Lunar New Year holiday, prompting the usual front-loading of copper and other metals ahead of the festive period.
• US Treasury Secretary Bessent said increased Venezuelan crude oil supply means lower fuel prices and proceeds from the sale of Venezuelan oil will return to Venezuelans.
• US is handing over a seized oil tanker to Venezuela, according to US officials.

Geopolitics: Ukraine

• Russian Kremlin spokesperson Peskov does not comment on reported of a energy infrastructure ceasefire between Russia and Ukraine.
• Russia’s Kremlin said they’re still waiting for the US response on Putin’s offer to extend limits in expiring nuclear treaty.

Geopolitics: Middle East

• Kpler’s Bakr, on Iran, writes “What I’m hearing: Trump isn’t looking for war. He wants a diplomatic win, or an “organic” internal uprising that forces change from within.”.
• Sources from Arab TV report that disputes are still ongoing between Egypt and Israel regarding the number of people crossing through the Rafah in both direction on a daily basis.
• EU’s top diplomat said the EU will likely agree on placing sanctions on Iran’s IRGC, AP’s Gambrell reported.
• Iran’s representative to the UN said Iran informs the Council it faces a clear US threat to use force against it, while the Iranian envoy said Washington will bear responsibility for any uncontrolled consequences resulting from any acts of aggression.
• CNN sources say US President Trump is considering a new large-scale strike on Iran as no progress has been made in nuclear talks, although he has not yet made a final decision on a new major military strike against Iran. Trump’s military options include airstrikes and targeting of Iranian leaders and security officials.
• BofA card spending, week to January 24th: +6.6% Y/Y (prev. 4.6% Y/Y). Spending growth grew in groceries and general merchandise, indicative of stockpiling before the Winter storm.
• Turkey said it has foiled an Iranian intelligence plot at US’ Incirlik base.

Geopolitics: Others

• Sources from Arab TV report that disputes are still ongoing between Egypt and Israel regarding the number of people crossing through the Rafah in both direction on a daily basis.
• Denmark’s Foreign Minister after his meeting in Washington said he’s more optimistic on Greenland compared to a week ago. Plan to hold further meetings. Back on track with the US on Greenland.

US Event Calendar

• 8:30 am: United States Jan 24 Initial Jobless Claims, est. 205k, prior 200k
• 8:30 am: United States Jan 17 Continuing Claims, est. 1850k, prior 1849k
• 8:30 am: United States Nov Trade Balance, est. -44b, prior -29.4b
• 10:00 am: United States Nov Factory Orders, est. 1.6%, prior -1.3%
• 10:00 am: United States Nov F Durable Goods Orders, prior 5.3%
• 10:00 am: United States Nov F Durables Ex Transportation, prior 0.5%
• 10:00 am: United States Nov F Wholesale Inventories MoM, est. 0.2%, prior 0.2%

DB’s Jim Reid concludes the overnight wrap

Yesterday was a rare occasion when both the latest Fed decision and a slew of Mag-7 results failed to materially move markets, with a pause by the FOMC leaving bonds and equities little changed while mixed results from Microsoft and Meta have left equity futures with marginal gains overnight. Precious metals continued to deliver the most eye-catching moves, with gold (+4.86%) yesterday posting its best day since the early weeks of the Covid pandemic and moving up another 2.41% overnight and above $5,500/oz as I type. Elsewhere Polymarket’s probability of a US government shutdown has sunk to 44% in the last couple of hours from a peak of 80% yesterday as the NYT has reported overnight that a deal between Democrats and Republican has been potentially sketched out. We will wait to see how that develops.

Starting with the Fed, and as widely expected the FOMC kept rates on hold at 3.50-3.75%. Governors Miran and Waller dissented in favor of a 25bps cut but there was “broad support” for keeping rates steady according to Chair Powell, who said the Committee was “well positioned” after delivering 75bps of rate cuts in late 2025. The pause came amid a more upbeat tone on the economy, with the statement noting the “solid pace” of economic activity and “some signs of stabilization” in the unemployment rate. Powell emphasised the “clear improvement” in the economic outlook since the last meeting, but any hawkish read-across was offset by a more sanguine tone on inflation. The Chair suggested that services disinflation was continuing, with most of the current inflation overshoot coming due to tariffs, the effect of which is expected to peak around the “middle quarters of the year”.

Powell offered little near-term guidance but suggested the next move is likely to be a cut, noting that “it isn’t anybody’s base case right now the next move will be a rate hike”. Our economists see the Powell-led Fed as having now delivered its last rate cut and, more broadly, they think risks around their expectation of one rate cut this year in September have become more balanced. See their full reaction here. Away from policy, Powell mostly deflected questions on the Lisa Cook hearing and whether he’d stay on as Governor after his term ends in May, while reiterating that he was “strongly committed to (Fed independence) and so are my colleagues”.

Bonds and equities saw muted post-FOMC reactions. Both 2yr (-0.2bps at 3.57%) and 10yr (-0.1bps at 4.24%) Treasury yields were little changed by the close, having been just over a basis point higher pre-FOMC. 10yr and 30yr US yields are +2.4bps and +3.2bps higher this morning though. Fed funds futures continue to price 47bps of easing by December (+0.2bps on the day). The S&P 500 (-0.01%) was also essentially unchanged at 6,978, after reaching the 7,000 level intra-day for the first time earlier in the session. The NASDAQ (+0.02%) and the Mag-7 (+0.04%) were steady as well, while the small cap Russell 2000 (-0.49%) retreated.

After the market close, we then received a mixed set of Mag-7 releases from Microsoft, Meta and Tesla. Microsoft’s shares slumped by around -6% after-hours despite a modest earnings beat, as the software giant only just met elevated cloud revenue growth expectations (at +38%) and saw higher-than-expected quarterly CAPEX outlays ($37.5bn vs $36.2bn est.). By contrast, Meta surged by more than +6% after-hours as it projected stronger ad-driven sales for the current quarter ($53.5-$56.5bn vs $51.3bn est.) and guided for stronger CAPEX in 2026 as a whole ($115-135bn vs $110.6bn est.). Meanwhile, Tesla’s shares gained about +2% in post-market trading after delivering a decent earnings beat and laying out plans to invest $20bn this year to streamline its EV lineup and expand work on robotics and AI. Those results have largely offset each other as far as equity futures are concerned with those tied to the S&P 500 (+0.11%) and NASDAQ 100 (+0.26%) trading slightly higher. We next have Apple reporting after the close today.  While we won’t get Nvidia’s earnings until late-February, multiple outlets reported that Beijing had approved purchases of its H200 chips for several Chinese companies including Alibaba. So that helped boost Nvidia’s share price, which rose +1.59%.

Before the Fed decision, the dollar also began to stabilise after Treasury Secretary Scott Bessent reiterated the “strong dollar policy” a day after Trump had seemed more relaxed about its direction. That came in a CNBC appearance, where he said that the US “always has a strong dollar policy, but a strong dollar policy means setting the right fundamentals”. He also commented that the US was “absolutely not” intervening in FX markets, which helped drive a dollar rebound against several other currencies. The dollar did give up some of its rebound later on, in part after Powell said that questions on the recent weakening in the dollar were in the purview of the Treasury not the Fed. Still, the euro was down -0.72% to $1.1954 by the close, with the Japanese yen weakening -0.78% to 153.41 per dollar. Both are back up around a third of a percent higher this morning.

Otherwise, oil prices saw further gains after Trump posted that a “massive Armada” was heading to Iran, and that time was “running out” for Iran to make a deal with the US. Moreover, he said the next US attack would be “far worse” than the strikes last June if Iran did not reach a deal. In response, Iran’s country mission to the UN said that it was ready to correspond with the US, but “if pushed” it would “defend itself and respond like never before.” And yesterday evening, CNN reported that Trump is considering a major strike on Iran but had not yet made a final decision. So fears of tensions escalating between the two countries caused oil prices to rise, with Brent (+1.23%) up to its highest since late-September and trading another +1.62% higher this morning at $69.51/bbl. There were even stronger gains for precious metals, with gold (+4.86%) posting its best day since March 2020 and having now seen its largest 8-day gain since the GFC. Gold is up another +2.41% to $5,550/oz as I type. Meanwhile, silver (+4.12%) also closed at a new high of $116.70/oz and is up just over a percent in Asia.

In Europe, there was a risk off tone yesterday, alongside sovereign bonds rallying as speculation mounted about a potential ECB rate cut this year. That followed comments before the open from the ECB’s Kocher, who said they might have to react if the euro kept appreciating, and overnight index swaps are now pricing in a 26% chance of a rate cut by the September meeting, from 16% before the comments. That helped to push yields lower across the continent, with those on 10yr bunds (-1.7bps), OATs (-0.9bps) and BTPs (-0.4bps) all falling back. Moreover, front-end yields led the declines as investors priced in a growing chance of a rate cut, with the 2yr German yield down -2.2bps.
Elsewhere in Europe, equities largely reversed their gains from the first two days of the week, with the STOXX 600 down -0.75%. Luxury goods were a big underperformer, led by a steep fall in LVMH (-7.89%) after the company’s earnings disappointed the previous evening, which meant the CAC 40 (-1.06%) saw one of the biggest falls.

Finally, the Bank of Canada held its policy rate at 2.25% yesterday, as expected. Governor Macklem kept their options open, saying that “elevated uncertainty makes it difficult to predict the timing or direction of the next change in the policy rate.” But markets are still pricing in a rate hike as most likely by year-end, which is priced in as a 42% probability.

In Asia, the KOSPI (+1.32%) is leading the way again, followed by the Hang Seng (+0.57%) and the Nikkei (+0.31%). Other markets are fairly close to flat.

To the day ahead, data releases include the US November trade balance, factory orders and initial jobless claims, Italy’s November industrial sales, the Euro Area’s January economic confidence. Central bank events include the Riksbank decision, and the ECB’s Cipollone will be speaking today. Finally, Apple, Visa, Mastercard and Blackstone are among those reporting today.