Global stock markets rose ahead of tech earnings, with Nasdaq futures up 0.6%. Gold briefly returned to 5,100, and silver rebounded to 110 USD

Under the risk aversion driven by the threat of tariffs from Trump and the risk of a U.S. government shutdown, precious metals such as gold and silver continue to perform strongly. Meanwhile, the market's optimistic expectations for the development of artificial intelligence continue to ferment, driving major global stock markets upward.

On January 27, U.S. stock index futures were mixed, with Nasdaq futures rising over 0.6%. European stocks opened higher collectively, Asian stock indices rose across the board, and South Korean stocks rebounded strongly after digesting tariff concerns. The bond market stabilized, with U.S. and Japanese bond yields rising. The yen fell back after a previous two-day rise driven by expectations of U.S.-Japan joint intervention, while the U.S. dollar index remained basically flat. Metals continued their strong upward trend, oil prices fell, and major cryptocurrencies rose.

The current market focus has shifted to Wednesday's Federal Reserve interest rate decision and the upcoming earnings reports from major technology companies, which will test whether the current stock market rally driven by artificial intelligence has sustainability. Goldman Sachs CEO David Solomon pointed out in analyzing the global market environment that stimulative fiscal policies, supportive regulatory trends and tones, and massive investments in artificial intelligence together constitute the main driving forces of the current market. He stated:

“From an economic perspective, things are developing well. Overall, the situation looks relatively optimistic, but that does not mean there won't be problems.”

Core market trends are as follows:

• U.S. stock index futures were mixed, with Dow futures down 0.08%, S&P 500 futures up 0.3%, and Nasdaq 100 futures up 0.66%.
• The Euro Stoxx 50 index opened up 0.35%, Germany's DAX index rose 0.2%, the UK's FTSE 100 index rose 0.35%, and France's CAC 40 index rose 0.1%.
• The Nikkei 225 index closed up 0.8%, at 53,333.54 points. Japan's Topix index closed up 0.3%, at 3,563.59 points. South Korea's Seoul Composite Index closed up 2.7%, at 5,084.85 points.
• The yield on the 10-year U.S. Treasury rose 1 basis point to 4.23%, while the yield on Japan's 10-year government bonds rose 4.5 basis points to 2.280%.
• The U.S. dollar index remained basically flat, with the yen falling 0.2% against the dollar to 154.47.
• Spot gold briefly returned to $5,100; spot silver returned to $110 after reaching a record high of $117; Brent crude oil fell 0.5% to $64.5 per barrel.
• Bitcoin rose 0.4% to $88,346.01, and Ethereum rose 0.3% to $2,935.37.

U.S. stock indices were mixed, with Nasdaq futures, dominated by technology stocks, rising over 0.6%. The market is currently focused on the upcoming earnings reports from major technology companies. Interactive Brokers analyst Jose Torres pointed out that investors have shown strong expectations for this quarter's critical earnings week, increasing their allocation to technology stocks ahead of earnings reports from four companies in the "Tech Seven." On the other hand, the potential for another U.S. government shutdown has become another risk point of concern for the market. As the deadline for a partial shutdown of the U.S. federal government approaches this Saturday, Trump has released a rare signal of compromise on immigration enforcement strategies in an effort to ease tensions in Minnesota following a shooting incident involving federal enforcement personnel.

If a partial shutdown occurs, although departments that have already received funding, such as the Department of Justice and the Department of Commerce, will not be affected, the Department of Homeland Security and the Pentagon will come to a standstill, with non-essential functions suspended, further exacerbating market concerns about Washington's governance capabilities.

U.S. Treasury prices are stabilizing, with trading showing narrow fluctuations. Given the stabilization of the job market, the market generally expects the Federal Reserve to maintain interest rates at the January meeting. Current investor focus remains on potential candidates for the next Federal Reserve Chair and issues regarding the Fed's independence. Currently, BlackRock executive Rick Rieder has emerged as the most likely candidate to succeed current Chair Powell in the prediction market.

Chris Larkin from Morgan Stanley's E*Trade stated:

"Although the Fed is not expected to cut rates, Powell's press conference may be more about the Fed's independence than policy."

Affected by Trump's announcement of increased tariffs, the South Korean stock market opened lower today but gradually rebounded and turned positive, ultimately closing up 2.73%. According to CCTV News reports, Trump announced on the 26th local time that the tariff rates on South Korean automobiles, pharmaceuticals, and timber would be raised from 15% to 25%. As a result, today, South Korean automotive stocks opened significantly lower, but the decline gradually narrowed. Meanwhile, SK Hynix's stock price surged by 8.7%, and Samsung Electronics also rose by 4.87%.

Pictet Asset Management Chief Strategist Luca Paolini stated:

"We believe that the threat of increased tariffs on South Korea will not have a significant impact. From past experience, we understand that while Trump may issue threats, he ultimately backs down. This threat seems to be more of a strategic consideration."

After experiencing two consecutive days of strengthening, the yen has slightly retreated today, currently stabilizing around 154.6 against the US dollar. Earlier, expectations of possible joint intervention by the US and Japan in the foreign exchange market boosted the yen significantly, with the market speculating that the two governments might take measures to prevent further depreciation of the yen. However, some analysts believe that the recent rebound of the yen has partially alleviated the depreciation pressure, potentially reducing the urgency for authorities to intervene in the short term.

Marc Chandler of Bannockburn Capital Markets stated:

"The strong rebound of the yen indicates that intervention is actually not necessary."

The trend of precious metals remains strong, with gold briefly pulling back after breaking the historical high of $5,100, stabilizing above $5,080, while silver returned to the $110 mark after reaching a record high of $117.

This sustained rally over seven trading days has been driven by a weaker dollar, geopolitical risks, and investors fleeing sovereign bonds in a "currency depreciation trade." Fawad Razaqzada, an analyst at City Index Ltd, stated:

"Traders are buying on dips rather than shorting the rebound. As long as this mentality persists, it will be difficult to argue against prices rising in the short term, even if there is a short-term disconnect between fundamentals and reality."