Nonfarm Payrolls Reinforce January Hold Expectations as the S&P 500 Hits Another Record High

Market Overview

Last Friday, U.S. equities extended their rally despite a mixed Nonfarm Payrolls report, with the S&P 500 closing at a fresh all-time high. Markets are increasingly confident that the Federal Reserve will keep interest rates unchanged at its January meeting, pushing the 2-year U.S. Treasury yield higher.

Shares of Intel surged nearly 10% after its CEO met with Donald Trump, while Oracle gained close to 5%. Meanwhile, tariff-sensitive stocks experienced heightened intraday volatility as the Supreme Court has yet to issue a ruling on Trumps tariff-related case.

In foreign exchange markets, the U.S. dollar extended its winning streak to a fourth consecutive session. The Japanese yen weakened sharply, sliding to around 158 per dollar amid speculation over a possible early general election in Japan. Cryptocurrencies gave back earlier gains, with Bitcoin briefly falling below USD 90,000.

Commodities delivered a strong performance. Spot gold rose more than 4% on the week, reclaiming the USD 4,500 level, while silver surged an impressive 10%, significantly outperforming. Crude oil finished higher after choppy trading, supported by geopolitical tensions surrounding Iran and Trumps hawkish rhetoric.

Early Asian session on Monday: Gold and silver opened modestly higher, extending their strength; Nasdaq futures edged down 0.2%; crude oil prices were largely unchanged.

Key Themes to Watch

● From “Mortgage QE” to “Credit Card Price Caps”

The White House is increasingly bypassing the Federal Reserve by using executive authority to directly intervene in what voters feel most acutely: borrowing costs. These actions not only undermine the integrity of the financial pricing mechanism but also signal a broader shift in interest-rate pricing power from markets toward political decision-making. The systemic risks associated with this transfer of pricing authority may prove far more concerning than a simple rate cut.

● Trump Again Threatens Iran

On the 10th, The New York Times reported, citing anonymous U.S. officials, that President Trump has recently been briefed on military strike options against Iran. While no final decision has been made, Trump is reportedly seriously considering authorizing U.S. military action. Potential options include strikes on non-military targets in Tehran. Earlier the same day, Trump posted on social media, once again threatening intervention in Irans current situation.

Events in Focus (GMT+8)

17:30 EU – Eurozone January Sentix Investor Confidence Index

Overnight

02:00 US – U.S. 10-Year Treasury Auction (High Yield), week ending January 12