What’s in this issue;
Markets leaned further into the soft-landing narrative this week as confidence grew around another Fed rate cut—pushing equities, tech, crypto, and precious metals higher while volatility continued to compress.
In Issue #45, we cover:
Markets & Policy: U.S. equities extended their rally for a third straight week, with the S&P 500 breaking above 6,100 as rate-cut expectations strengthened and bond yields edged lower.
Risk Assets Surge: Tech and growth stocks led gains, the Nasdaq jumped over 3%, and Bitcoin finally cleared the $100K mark—reinforcing a broad risk-on backdrop.
Commodities Diverge: Precious metals are surging on geopolitics and trade risk, while oil struggles under a growing 2026 supply glut. Silver has gone parabolic.
Silver & Miners in Focus: We break down the drivers behind silver’s rally and highlight key producers and streaming plays positioned to benefit if prices stay elevated.
OPEC+ Reality Check: Production freezes may stabilise crude short term, but oversupply still caps upside into 2026.
Emerging Markets at a Pivot: A rare convergence of EM central bank decisions, capital rotation away from US assets, and AI “picks-and-shovels” demand could shape EM flows for the rest of the year.
Week Ahead: Fed and BoC decisions, mega-cap earnings (Microsoft, Apple, Meta, Tesla, ASML), and key global growth data put policy messaging firmly in the spotlight.
ICYMI: Tariff threats, geopolitical tension, extreme weather disruption, and what they mean for markets and investor sentiment.
Bottom line: Policy confidence is driving markets—but beneath the rally, commodities, EM, and AI infrastructure are sending clearer signals about where 2026 leadership may emerge.
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What Moved Markets This Week
U.S. equities extended their rally for a third consecutive week, driven by growing confidence that the Federal Reserve will deliver another rate cut at its final meeting of the year.
Softer financial conditions, resilient economic data, and renewed enthusiasm for growth assets pushed major indices higher, with tech leading the advance and volatility continuing to grind lower.
Key market drivers this week:
Rate-cut expectations strengthened: Markets increasingly priced in another Fed cut following signs of easing financial conditions and a stable inflation backdrop, supporting risk assets.
Strong U.S. jobs report reassured investors: November nonfarm payrolls beat expectations with 227K jobs added, while a slight uptick in unemployment to 4.2% reinforced the “soft landing” narrative rather than derailing easing expectations.
Equities pushed to fresh milestones: The S&P 500 broke above 6,100 for the first time, surpassing most Wall Street year-end targets and reinforcing momentum-driven buying.
Tech and growth stocks led gains: The Nasdaq surged over 3% on the week, with strength across AI, software, and consumer discretionary names.
Crypto sentiment improved: Bitcoin finally broke above the $100K level, lifting broader crypto assets and reinforcing risk-on positioning.
Volatility continued to compress: The VIX fell to near multi-month lows, signalling investor comfort with both economic and policy expectations.
Bond yields edged lower: A modest decline in Treasury yields further supported equity valuations, particularly in long-duration growth stocks.
What This Means for Investors
The soft-landing narrative is intact: Strong job growth alongside easing rate expectations supports continued upside in risk assets rather than a sharp economic slowdown.
Momentum favours growth assets: Falling volatility, lower yields, and rate-cut expectations continue to support tech, consumer discretionary, and other long-duration sectors.
Policy is the dominant driver: Markets are being led less by fundamentals and more by confidence in central bank support heading into year-end.
Actionable Takeaways
Stay positioned for rate cuts: Maintain exposure to growth and technology leaders that benefit most from falling yields and improving financial conditions.
Use strength to rebalance, not exit: With indices above most year-end targets, consider trimming outsized winners while keeping core equity exposure intact.
Watch volatility as a signal: Persistently low VIX levels support staying invested, but any sharp spike could be an early warning of sentiment turning.
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Things I’m Paying Attention To
Commodities: A Market Pulled in Two Directions
The commodities complex is splitting sharply in early 2026.
Precious metals are ripping to record highs on geopolitics and trade risk, while oil is sliding under the weight of oversupply and slowing demand expectations.
🥇 Precious Metals: The “Greenland Premium”
Precious metals are the standout trade of the moment, fuelled by a mix of geopolitical stress, trade tensions, and safe-haven flows tied to US tariff threats linked to Greenland.
Gold ($4,700–$4,900/oz)
Gold has pushed to fresh all-time highs as investors hedge escalating US-Europe trade frictions. Major banks including JPMorgan and Goldman Sachs are now openly forecasting a move toward $5,000/oz before year-end.
Silver (~$95/oz)
Silver has gone parabolic, nearly doubling over the past year. It’s benefitting from its dual role as both a geopolitical hedge and a critical input for solar, EVs, and the wider energy transition.
Platinum
After years of underperformance, platinum has surged to levels not seen since 2007. A long period of relative undervaluation versus gold has finally corrected.
🛢️ Oil: The 2026 Supply Wave
Oil is telling a very different story. Brent and WTI continue to drift lower as markets price in a prolonged surplus.
Oversupply is the core issue
Record production from the US, Canada, and Guyana is flooding the market, while OPEC+ struggles to defend market share.
Where prices are sitting
Brent is hovering around $64, with WTI struggling to hold $59. The World Bank and IEA both expect prices to average $56–$60 through 2026 unless a major geopolitical shock physically removes supply.
The “Trump factor”
Ironically, the same tariff threats boosting gold are pressuring oil. Markets fear that weaponised trade will slow global growth—directly hitting fuel demand.
What to Watch Next
⚠️ February 1st is the key date.
If the proposed 10% “top-up” tariffs are implemented, expect:
Sharp volatility spikes in gold and silver
Further pressure on oil demand expectations
This divergence isn’t noise—it’s a clear signal of how markets are pricing geopolitics versus growth in 2026.
🔎 Top Silver Stocks to Watch in the Current Rally
With silver prices surging and structural supply deficits supporting long-term demand, several mining stocks are emerging as strong beneficiaries of this metals boom.
Precious metals equities have already seen outsized gains in 2025 and are positioned for continued upside if silver stays elevated in 2026.
📈 Pure Silver Producers
Pan American Silver (PAAS) – One of the world’s largest primary silver producers, with diversified operations across the Americas. Strong earnings and production growth have already driven notable share performance. First Majestic Silver (AG) – Pure-play silver miner with rapidly expanding output from high-grade Mexican assets, translating directly to revenue gains in a rising price environment.
MAG Silver (MAG) – Significant stakeholder in Juanicipio, one of the highest-grade silver mines globally, giving leveraged exposure to a further price surge.
SilverCrest Metals (SILV) – Newly commercial high-grade mine in Mexico with strong free cash flow potential and exploration upside.
Hecla Mining (HL) – Largest U.S. silver producer, with stable production and a long track record of reserves replacement.
💡 Other Silver-Linked Plays
Fresnillo plc (FRES) – The world’s largest primary silver producer, often a bellwether for silver prices.
Wheaton Precious Metals (WPM) – A high-margin streaming company with ~39% of revenue tied to silver, offering leveraged exposure without direct mining risks.
Why these matter: Many of these names have seen double- and triple-digit share moves in the last year and benefit both from rising prices and structural industrial demand growth (e.g., solar, EVs).
🛢️ OPEC+ Outlook — Q1 2026 Production Snapshot
As oil markets continue to struggle with oversupply, the OPEC+ coalition has taken a cautious approach in early 2026 to avoid further price erosion.
Key points for Q1 2026:
Production Freeze: OPEC+ leaders (including Saudi Arabia, Russia, UAE, Iraq, Kuwait, Kazakhstan, Algeria, and Oman) paused planned output increases for January–March 2026, opting to hold crude volumes steady seasonally.
Extended Quotas: The pause follows a modest production increase in December 2025 and is part of broader quota commitments carried over from late 2025 into 2026.
Supply-Demand Balance: Official data suggest OPEC+ production and demand remain close to balanced levels, with only a small surplus forecast if volumes remain unchanged — a shift from earlier expectations of a larger oversupply.
What this means:
While the freeze stabilises near-term crude volumes, underlying global supply growth (especially outside OPEC)continues to pressure prices. EIA forecasts show total global liquid fuels production rising in 2026, with Brent expected to average lower than in 2025 unless further cuts are made.
📌 Quick Takeaways for Investors
🪙 Silver–miners remain core plays for those seeking leveraged exposure to the precious metals rally.
📊 Diverse approaches (producers vs. streamers) let you balance risk and margin exposure.
🛢 Oil supply dynamics are stabilising, not tightening — thanks to OPEC+ quota management — but the broader surplus trend still caps major upside in crude.
Emerging Markets: A Rare Convergence of Pivots
The coming week is shaping up to be a pivotal moment for Emerging Markets. As the US Federal Reserve opens its first meeting of the year, several major EM economies are simultaneously approaching key inflection points. This rare convergence of pivots could set the direction of capital flows for the rest of 2026.
Here’s what matters this week.
1. The EM Central Bank “Big Three”
Wednesday is the focal point for EM monetary policy.
Brazil (BCB): Inflation has cooled to 3.2%, giving policymakers room to soften their stance after one of the most restrictive cycles in the world. Rates peaked at 15%, and markets are split on whether the BCB cuts this week or waits until March. A cut now would signal a meaningful narrowing of the BRL–USD yield spread and could accelerate flows into Brazilian assets.
China (Data Watch): Chinese Industrial Profits on Tuesday will be closely watched. With deflationary pressures lingering and Beijing pushing a structural shift toward tech-led growth, weak data would likely reignite calls for further fiscal or monetary stimulus.
Policy Divergence Is Back: Unlike the synchronised EM tightening cycles of 2024–25, central banks are now moving at different speeds. Latin America is tilting toward easing, while parts of Asia remain steady, supported by strong tech-export demand.
2. The “Quiet Quitting” of US Assets
A subtle but important rotation continues to gather pace.
Capital Rotation: Investors are increasingly trimming US exposure in favor of EM equities and hard assets. Gold’s recent move toward $5,000/oz has become a key beneficiary of this shift.
Why Now: Elevated US valuations, combined with rising US–Europe tensions, are pushing global capital toward the MSCI EM Index, where earnings growth is forecast at 16% this year—well ahead of most developed markets.
3. Geopolitics & Trade: Risk Appetite on Watch
Two global meetings could influence sentiment well beyond this week.
Asian Financial Forum (Jan 26–27): Opening in Hong Kong, the focus has shifted from pure growth to “trust and stability.” Expect discussions around supply-chain re-routing as EM economies adapt to new trade frictions.
Abu Dhabi Diplomacy: Trilateral talks continue in the background. Any progress on the Russia–Ukraine conflict or stability in Middle Eastern trade routes would be a clear risk-on signal for EM debt, FX, and equities.
4. EM Tech: The AI ‘Picks and Shovels’ Trade
While US markets debate whether AI has become a bubble, EM tech looks increasingly fundamental.
Asia’s Hardware Edge: Names like TSMC, Samsung, and SK Hynix remain central to the physical build-out of global AI infrastructure. Their earnings are less tied to speculative software multiples and more to real-world demand for chips, memory, and fabrication capacity.
Looking Forward: What We Anticipate Next Week
Key Events Next Week
The upcoming week is relatively light on top-tier economic data, but it carries significant policy risk with a Federal Open Market Committee meeting on the calendar.
While no change is expected to the Fed Funds Rate, investors will be closely focused on central bank messaging for clues on the timing and direction of the next move.
Alongside monetary policy decisions, earnings season reaches its peak, with several mega-cap and global bellwether companies set to report.
Monday’s focus is on US durable goods orders, which previously fell 2.2% month-on-month. As a leading indicator of manufacturing demand and business investment, this data point will be watched for signs of stabilisation. A rebound would help reinforce the view that underlying economic momentum remains intact despite tighter financial conditions.
Wednesday is the most consequential day of the week, bringing two major central bank decisions. The Bank of Canada is expected to hold its policy rate at 2.25%, with markets assessing how policymakers balance easing inflation against still-fragile growth.
The decision will have direct implications for borrowing costs and the Canadian dollar. Later in the day, the Federal Reserve delivers its interest rate decision, with no change expected and the policy rate forecast to remain at 3.75%.
While the outcome itself is unlikely to surprise, the accompanying statement and tone will be scrutinised for guidance on the Fed’s next move and the broader policy outlook.
On Thursday, attention shifts to Japan, where January consumer confidence is expected to edge up to 37.6 from 37.2. Gradual improvements in sentiment are important for sustaining a recovery in consumption, which remains a key condition for the Bank of Japan to justify further policy normalisation.
Friday brings the Eurozone’s flash estimate of fourth-quarter GDP growth on a year-on-year basis. The previous reading stood at 1.4%, and this release will be closely watched for confirmation that the region’s recovery is becoming more durable.
Evidence of improving structural growth would help support European equities and the euro, while a weaker outcome would reinforce concerns about stagnation.
Earnings season hits its busiest point of the quarter, with four members of the so-called “Magnificent Seven” reporting alongside major names across multiple sectors.
Results from Microsoft, Meta, Apple, Tesla, and ASML will shape sentiment around technology and AI-related investment trends.
Visa and UnitedHealth will provide insight into consumer spending and healthcare demand, while Exxon, Texas Instruments, IBM, RTX Corp, and UnitedHealth offer a read on energy, industrials, semiconductors, and defensive sectors.
Overall, the week ahead will test how markets balance central bank caution against resilient corporate earnings.
With policy decisions in focus and mega-cap results driving index-level moves, investor sentiment is likely to remain sensitive to both guidance and forward-looking commentary as expectations for the rest of the year continue to evolve.
Three Things to Watch
First, central bank messaging will matter more than the decisions themselves. With both the Federal Reserve and the Bank of Canada expected to hold rates steady, markets will focus on forward guidance and tone.
Any hint that policymakers are becoming more comfortable with easing later in the year could move rates, currencies, and equity valuations quickly.
Second, mega-cap earnings will drive index direction. With Microsoft, Meta, Apple, Tesla, and ASML reporting, results and guidance from just a handful of companies have the power to shape overall market sentiment.
Investors will be listening closely for commentary on AI spending, margins, and demand trends into the second half of the year.
Third, signs of global growth stabilisation will be closely watched. Data from the US, Japan, and the Eurozone will help determine whether recent improvements in activity are gaining traction or losing momentum.
Confirmation of stabilising growth would support risk assets, while disappointment could quickly revive concerns about a broader slowdown.
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ICYMI
A major U.S. winter storm dominated headlines, alongside ongoing political tensions over immigration enforcement, economic data releases, and global market jitters from tariff threats.
Markets showed volatility but remained resilient overall.
Massive Winter Storm Blankets U.S. Northeast and Midwest: A severe storm dumped heavy snow and ice, leaving over 1 million without power, forcing 10,000+ flight cancellations, and causing widespread travel chaos. Snow totals hit 7-10 inches in cities like New York, Philadelphia, and D.C., with dangerous conditions persisting into the weekend.
Fatal ICE Shooting in Minneapolis Sparks Protests: An ICU nurse and U.S. citizen, Alex Pretti, was shot and killed by federal agents during an immigration enforcement operation; video evidence contradicted initial claims he was armed (he was holding a phone). Protests erupted across Minnesota demanding ICE withdrawal, with calls growing louder amid broader debates on federal overreach.
Trump Tariff Threats Rattle Global Markets: President Trump issued warnings of new tariffs on countries including France, the UK, and others, contributing to a dip in global stocks early in the week. The dollar weakened against safe-havens like the yen and Swiss franc, while gold saw a safety bid.
Economic Data and Fed Focus: Key releases included Core PCE inflation data (closely watched for Fed policy clues), with markets reacting to Powell’s steady stance amid hot economic indicators. Earnings season kicked off with big reports expected to influence rate outlooks. Broader 2026 projections from the IMF held global growth steady at 3.3%, with upward revisions.
Davos World Economic Forum Wraps Up: Discussions at Davos highlighted geopolitical risks, AI profitability questions, and tariff policies, with Trump-NATO meetings drawing attention. Investors eyed implications for trade and fiscal policy.
Other Quick Hits: Ongoing debates on AI’s profit generation and private debt returns; Polymarket buzz around events like UFC 324 and political protests; minor geopolitical notes including NATO dynamics.
Why It Relates to the Market and Investors
This week’s events carried clear implications for markets and investor sentiment:
Winter Storm Disruptions → Short-term hits to supply chains, retail, energy demand, and travel sectors (e.g., airlines, logistics). Power outages boosted utility stocks temporarily but raised insurance and recovery cost concerns. Broader economic drag possible if prolonged, though markets often view weather events as transitory.
Immigration Enforcement Tensions → Heightened political polarisation could pressure bipartisan spending bills (e.g., DHS funding facing Senate blocks), risking government shutdown risks later in Q1. Investors watch for policy uncertainty impacting labor markets, consumer confidence, and sectors like construction/agriculture reliant on immigration.
Tariff Threats and Trade Rhetoric → Direct volatility driver: Early-week stock dips reflected fears of renewed trade wars, hurting exporters, multinationals, and inflation-sensitive assets. Safe-haven flows to gold/yen underscored risk-off mood. Longer-term, tariffs could fuel inflation and slow growth, prompting Fed caution on rate cuts.
Inflation Data & Fed Outlook → Core PCE and related releases reinforced a “higher for longer” rates narrative in some views, pressuring growth stocks while supporting value/financials. Earnings acceleration expectations for 2026 remain positive, but tariff/AI uncertainty tempers enthusiasm.
Overall Investor Takeaway → Markets showed modest weekly losses (S&P down ~0.4%, Dow ~0.3%) but resilience amid volatility. Focus remains on policy clarity (tariffs, Fed path) and economic resilience, with 2026 outlooks still leaning positive (2-3% U.S. GDP growth projected) unless geopolitical escalations intensify.
Useful Links (Any Interesting Stories)
Reuters: U.S. Storm Leaves 1M Without Power, 10K Flights Canceled – Live updates on storm impacts.
NYT: Man Killed by Federal Agents in Minneapolis Was Holding a Phone, Not a Gun – In-depth on the shooting and video analysis.
Nasdaq: Stock Market News for Jan 19, 2026 – Weekly market wrap with sector details.
LiteFinance: Weekly Economic Calendar Jan 19-25, 2026 – Key data releases and previews.
Reuters: Stocks Fall After Trump’s Tariff Threats – Global reaction to trade rhetoric.
ABC News: Winter Storm Live Updates – Visuals and regional snow totals.
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