Indices surge to new highs again

Chris Beauchamp IG

It has been another good week for equities, with new highs in the US and UK, says Chris Beauchamp, Chief Market Analyst at investing and trading platform IG.

Softer inflation powers new market rally

Any worries about today’s US inflation figures have been dispensed with following a softer set of figures. This clears the way for next week’s Fed meeting to cut rates, not that that was ever really in doubt anyway. The afternoon has seen the Dow, S&P 500 and Nasdaq roar to new records, joined by the FTSE 100 which continues to bask in better UK economic data and corporate news. The week has seen further declines in volatility, as trade war fears ease. Now attention shifts to the Trump-Xi meeting, perhaps the one event that really has the power to provide a surprise.

Oil recovery continues

Oil prices seem poised to enjoy their best week in months, spurred by signs of higher US demand and the new sanctions on Russia. But any sustained strength in the commodity could risk a fresh round of output increases from OPEC+, keen to maintain dominance and (in Saudi Arabia’s case) maintain the friendship of the US and its mercurial leader. Oil bears have been trounced this week, but it feels like a temporary setback.

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Chris Beauchamp

EUR/USD hovers around nine-day EMA above 1.1800

EUR/USD remains in the positive territory after registering modest gains in the previous session, trading around 1.1820 during the Asian hours on Monday. The 14-day Relative Strength Index momentum indicator at 54 is edging higher, signaling improving momentum. RSI near mid-50s keeps momentum balanced. A sustained push above 60 would firm bullish control.

GBP/USD holds medium-term bullish bias above 1.3600

The GBP/USD pair trades on a softer note around 1.3605 during the early European session on Monday. Growing expectation of the Bank of England’s interest-rate cut weighs on the Pound Sterling against the Greenback.

Gold sticks to gains above $5,000 as China's buying and Fed rate-cut bets drive demand

Gold surges past the $5,000 psychological mark during the Asian session on Monday in reaction to the weekend data, showing that the People's Bank of China extended its buying spree for a 15th month in January. Moreover, dovish US Federal Reserve expectations and concerns about the central bank's independence drag the US Dollar lower for the second straight day, providing an additional boost to the non-yielding yellow metal.

Bitcoin, Ethereum and Ripple consolidate after massive sell-off

Japan's Takaichi secures historic victory in snap election

In Japan, Prime Minister Sanae Takaichi's coalition secured a supermajority in the lower house, winning 328 out of 465 seats following a rare winter snap election. This provides her with a strong mandate to advance her legislative agenda.

Bitcoin, Ethereum and Ripple consolidate after massive sell-off

Bitcoin, Ethereum, and Ripple prices consolidated on Monday after correcting by nearly 9%, 8%, and 10% in the previous week, respectively. BTC is hovering around $70,000, while ETH and XRP are facing rejection at key levels. Traders should be cautious: despite recent stabilization, upside recovery for these top three cryptocurrencies is capped as the broader trend remains bearish.