【TrueZhuo Finance】UK Political Crisis; Alphabet's Bond Issue Receives Warm Reception
After receiving support from all cabinet members, British Prime Minister Starmer's governing crisis has temporarily eased. Alphabet (GOOGL.US) is expected to raise $20 billion through a US dollar bond issuance.
Overnight Highlights
– The S&P 500 and Nasdaq indexes rose steadily on Monday after a volatile start, with tech stocks regaining momentum following last week's decline, as investors awaited key economic data to gauge the Federal Reserve's interest rate path. U.S. Treasury yields edged lower, giving up earlier gains, with several important economic data releases scheduled for this week. The yen rose, reversing a six-day losing streak, after Japanese Prime Minister Takaichi's ruling coalition won Sunday's election. Oil prices closed up more than 1% after the U.S. Department of Transportation issued a notice requiring U.S.-flagged vessels to stay as far away as possible from Iranian territorial waters when transiting the Strait of Hormuz and the Gulf of Oman. Gold prices rose 2%, aided by a weaker dollar, as investors prepared for a slew of U.S. economic data this week that could provide more clues on the Fed's monetary policy.
International News
– The Epstein fallout rocked British politics, with two of Prime Minister Starmer's close aides resigning in a single day. The Scottish Labour leader called on Starmer, embroiled in the Mandelson scandal, to resign, but all cabinet members expressed support for Starmer.
– The U.S. will release the January non-farm payrolls report on Wednesday, which includes revisions to annual employment data through March 2025. Trump's chief economic advisor Hassett believes the slowing population trend will lead to a slight decline in employment data, but it remains consistent with higher GDP growth.
– A New York Fed survey showed U.S. consumers' expectations for inflation and the job market improved slightly in January.
– Politico reported that Trump will visit China in the first week of April, and he and Xi Jinping may have four meetings this year. White House officials said the date for the April meeting has not been finalized.
– Japanese Prime Minister Takaichi pledged to build trust with the market, reiterating that the government will avoid issuing bonds to raise funds, and she will seek to build stable relations with China.
– Due to strong subscription demand, Google parent Alphabet (GOOGL.US) is expected to raise $20 billion from its US dollar bond issuance, and the company also plans to issue a rare 100-year pound sterling bond.
– Microsoft (MSFT.US) had its stock rating downgraded twice in less than a week, with Melius Research warning of AI-related risks.
– Bitcoin's rebound lacked strength, with traders still taking defensive positions and adding almost no new bullish bets. Fed Governor Waller said the cryptocurrency boom triggered by Trump may be fading.
– Villeroy will step down early as Governor of the Bank of France in June, with his successor to be decided by President Macron.
– The IMF Managing Director downplayed the dollar's "short-term volatility," saying the currency's dominance will not change in the short term.
– Goldman Sachs (GS.US) said hedge funds set a record last week by increasing their short positions in U.S. stocks, with the information technology sector being the hardest hit by selling.
– The U.S. will lower its reciprocal tariff rate on Bangladesh to 19% and provide new exemptions for textiles.
Greater China News
– Chinese President Xi Jinping inspected displays of technological innovations such as artificial intelligence and robotics, calling for accelerated efforts to address prominent shortcomings in science and technology. During his inspection in Beijing, he also exchanged views with representatives of technology companies, including Lei Jun, founder of $XIAOMI-W(01810.HK).
– Xinhua News Agency: The Shanghai, Shenzhen, and Beijing Stock Exchanges will optimize the review of refinancing for high-quality listed companies to support innovative development.
– Seven Chinese departments, including the Ministry of Human Resources and Social Security, conducted administrative guidance on employment for leading platform companies such as $MEITUAN(03690.HK), Taobao Flash Sales, and Didi (DIDIY.US), as well as express delivery companies, requiring relevant enterprises to continuously improve labor management.
– China's Ministry of Commerce held a symposium with automobile companies, taking multiple measures to expand and improve automobile consumption. Additionally, transportation authorities summoned Gaode Taxi, demanding strengthened supervision and management of cooperative ride-hailing platforms.
– China will provide tax rebate incentives for cross-border e-commerce export goods returned between January 1, 2026, and December 31, 2027.
– The Shanghai International Energy Exchange and the Shanghai Futures Exchange adjusted margin requirements for some futures contracts, with the SHFE adjusting the price limit for some copper and aluminum contracts to 10%.
– The Shanghai Gold Exchange will increase the trading margin ratio for gold and silver deferred contracts from the close of settlement on February 11, 2026.
– Overnight borrowing provided by the Hong Kong Monetary Authority to banks through the discount window rose to a three-month high on Monday.
– Emerging market stock and bond ETFs recorded inflows for the 16th consecutive week last week, with India leading in attracting funds, followed by China.
Commodities & Forex Markets
– The Bloomberg Dollar Index continued to fall, with Chinese regulators reportedly recently guiding financial institutions to control their holdings of U.S. Treasury bonds.
– Oil prices rose as the U.S. request for vessels to stay away from Iranian waters led to a recovery in risk premiums.
– Bargain-hunting returned to the precious metals market, with gold rising above $5,000 per ounce.
Earnings & Economic Data Focus
– U.S. December Retail Sales MoM (Prev: 0.60%, Forecast: 0.40%)
– U.S. January NFIB Small Business Optimism Index (Prev: 99.5, Forecast: 99.8)
Source: Golden Horse Capital Management (Hong Kong) Limited
Author: Terry Chow
Proofreader: Penny Yang
The copyright of this article belongs to the original author/organization.
The views expressed herein are solely those of the author and do not reflect the stance of the platform. The content is intended for investment reference purposes only and shall not be considered as investment advice. Please contact us if you have any questions or suggestions regarding the content services provided by the platform.
