Market drivers and catalysts
Equities: US ended mixed on weak retail sales, Europe paused after records, Hong Kong rose as tech and travel improved.
Volatility: Event risk elevated, jobs today, CPI Friday, mild upside skew
Digital Assets: Macro-sensitive consolidation, selective hedging in crypto equities
Fixed Income: US treasury yields dip after weak US retail sales data
Currencies: JPY firmed broadly late Tuesday and Wednesday in Asia even as Japan’s market were closed Wednesday.
Commodities: Gold supported by weak US data ahead of jobs report; oil trades near USD 70 as Middle East risk premium builds again.
Macro events: US January Nonfarm Payrolls Change, US Jan. Unemployment Rate, US Jan. New Home Sales
Macro headlines
US retail sales stalled in December, missing the expected 0.4% gain after November's 0.6% increase. Gains in sectors like building materials and sporting goods were offset by declines in miscellaneous retail and furniture stores. Excluding autos and gasoline, sales were flat, while GDP-related sales fell 0.1%, the first drop in three months.
US compensation costs for Q4 2025 for civilian workers rose by 0.7%, below the 0.8% forecast and the smallest increase since Q2 2021. Both wages and benefits were up 0.7%. Private and government worker compensation rose 0.7% and 0.8%, respectively. Annually, costs increased 3.4%, slightly down from Q3's 3.5%.
US household debt reached $18.8 trillion in Q4 2025, up $191 billion. Mortgages rose by $98 billion, credit cards by $44 billion, auto loans by $12 billion, HELOCs by $11.6 billion, and student loans by $11 billion. Wilbert van der Klaauw of the New York Fed reported rising mortgage delinquencies, especially in lower-income areas.
In the UK, amid the Mandelson scandal, Keir Starmer's chief of staff resigned, sparking leadership questions. Despite calls for his resignation, cabinet support stabilized Starmer. Speculation on Bank of England rate cuts affected the currency, with the rate still at 3.75% and inflation expected to hit 2% by April.
Rising fears about disruption from AI are weighing on shares across sectors, from small software companies to large wealth-management firms, as investors move quickly to avoid exposure to businesses seen as vulnerable, even as experts remain divided on how quickly and how deeply the technology will reshape the corporate landscape.
Macro calendar highlights (times in GMT)
1200 – US Feb. MBA Mortgage Applications
1330 – US Jan. Nonfarm Payrolls Change
1330 – US Jan. Unemployment Rate
1330 – US Jan. Average Hourly Earnings
1500 – US Jan. Existing Home Sales
1530 – EIA's Weekly Crude and Fuel Stocks Report
1800 – US to sell USD 42 Billion 10-year Notes
During the day: OPEC’s Monthly Oil Market Report
Earnings this week
Today: Cisco, McDonalds, T-Mobile US; TotalEnergies, Shopify, Siemens Energy, EssilorLuxottica, Applovin, CVS Health, Hilton Worldwide, Vertiv Holdings, Motorola, Heineken
Thu: Hermes, L’Oreal, Applied Materials, Siemens, Arista Networks, Unilever, Softbank Group, Anheuser-Busch InBev, British American Tobacco, Vertex Pharmaceuticals, Brookfield, Agnico Eagle Mines, Howmet Aerospace, Airbnb, Vale, Mercedes Benz, Japan Tobacco, KBC Group, American Electric Power, Zoetis, Coinbase
For all macro, earnings, and dividend events check Saxo’s calendar.
Equities
USA: U.S. stocks were mixed, with the Dow rising 0.1% to 50,188.14 for another record close, while the S&P 500 fell 0.3% to 6,941.81 and the Nasdaq Composite slid 0.6% to 23,102.47. A flat December retail-sales print versus a 0.4% expected gain pulled Treasury yields lower and kept risk appetite selective, as investors balanced softer consumer momentum against still heavy AI investment plans. Spotify jumped 14.8% on strong results and faster user growth, Datadog rose 13.7% after beating expectations and lifting its outlook, and Marriott gained 8.5% as luxury travel demand supported guidance, while S&P Global sank 9.7% after a disappointing update; attention then turned to the delayed jobs report and the next wave of earnings.
Europe: European equities cooled after Monday’s records: the Euro Stoxx 50 slipped 0.2% to 6,047.06 and the Stoxx 600 eased 0.1% to 620.97, while the FTSE 100 fell 0.3% to 10,353.84. Earnings headlines pulled in different directions, with tech stabilising after last week’s software wobble, but financials stayed under pressure as investors fretted that new AI tools could squeeze pricing power. Kering jumped 10.9% as results were better than feared, Ferrari rose 10.2% after upbeat profit and guidance, BP fell 6.1% after pausing buybacks and taking charges, and Standard Chartered slid 5.7% on an unexpected CFO exit. The market stayed focused on the next batch of earnings.
Asia: Hong Kong stocks extended their rebound, with the Hang Seng Index up 0.6% to 27,183.15, the Hang Seng Tech Index rising 0.6% to 5,451.03, and the China Enterprises Index gaining 0.8% to 9,242.75. Sentiment improved as softer U.S. data nudged yields lower and investors leaned into the Lunar New Year travel theme, while talk of a possible Trump visit to Beijing in April added a dose of headline-driven optimism. JF SmartInvest jumped 9.4% on a stronger profit outlook, Axera finished flat at HK$28.20 in its debut as IPO fever cooled, and Zhaojin Mining dropped 5.8% to HK$32.60 after a fatal mine accident; focus then shifted to China’s CPI and PPI data due Wednesday.
Volatility
Volatility remains contained, but the market is clearly on standby for macro catalysts. The VIX closed at 17.79 on 10 February, up modestly on the day, while the S&P 500 slipped 0.33% to 6,941.81. Short-dated gauges such as VIX1D (13.64) and VIX9D (14.94) indicate that investors are not in panic mode, yet positioning reflects sensitivity around scheduled data and rates.
Today’s delayed US January jobs report and Friday’s US CPI release are the key macro events for the week. Both have the potential to shift rate expectations and, in turn, equity valuations. In addition, today’s 10-year US Treasury auction adds another potential source of intraday rate volatility.
Based on current options pricing, the SPX expected move into Friday 13 February is approximately ±78 points (±1.13%), suggesting a week that may see swings, but within a defined range.
For today’s expiration, the options chain shows mild upside skew, with calls around the 6,940–6,945 area trading at higher implied volatility than comparable puts. This suggests investors are still willing to pay for upside exposure, even as they manage downside risk more actively.
Digital Assets
Crypto markets are trading with a cautious tone ahead of US macro data. Bitcoin is holding in the mid-$60,000 range, while Ethereum trades around the low-$2,000s, with most major altcoins also softer on the latest session. The broader picture remains consolidation-driven, rather than trend-driven, as investors wait for clarity on inflation and rates.
In listed crypto vehicles, IBIT and ETHA both declined in the latest session, reflecting the broader risk tone. However, ETF flow data suggests positioning is not one-sided. On 10 February, IBIT recorded net inflows of approximately $26.5 million, while overall spot Ether ETF flows were modestly positive, with ETHA flat on the day. This combination points to selective engagement rather than broad capitulation.
Options flow continues to show a “manage the downside, keep the exposure” approach. Large put activity in Coinbase and MicroStrategy suggests investors are tightening risk around crypto-linked equities, while selective call accumulation in infrastructure names indicates that longer-term upside optionality is still in demand.
Overall, the message from digital assets is one of prudence, not stress: positioning is more defensive at the margin, but the structural bid via ETFs and institutional wrappers remains intact.
Fixed Income
US Treasury yields fell again, in part on the weak US Retail Sales data for January, with the benchmark 2-year treasury yield dipping back toward the range lows, closing three basis points lower at 3.45% lower Tuesday. The lowest daily close for the cycle since 2022 was a mid-October’s 3.424%. The benchmark 10-year yield fell almost six basis points to its lowest close since mid January at 4.14%. Treasuries await the US January employment report later today and US January CPI data on Friday.
Europe’s sovereign bond yields have fallen in recent days, with the German 2-year Schatz yield falling another basis point Tuesday to close just below 2.07% as the market in recent weeks has shifted to pricing slim odds of ECB rate reductions later this year, though still seen unlikely.
Japan’s markets were closed Wednesday.
Commodities
Gold holds above USD 5,050 after weak US retail sales reinforced expectations of Fed rate cuts, pushing the dollar and US Treasury yields lower ahead of today’s delayed January payrolls report. Technical resistance is seen near USD 5,090, and a break above could open for a move toward USD 5,140, the 61.8% retracement of the recent correction. Meanwhile, silver volatility continues to ease, with more orderly price action also emerging in Shanghai ahead of the extended Lunar New Year holiday.
Oil trades firmer, with Brent back above USD 69 as Middle East tensions sustain a modest risk premium. The US signalled it is considering seizing tankers carrying Iranian oil, while President Trump threatened to deploy another aircraft carrier should nuclear talks with Iran fail. Separately, the weekly API report showed a 13.4 million barrel build in US crude inventories, and attention now turns to OPEC’s monthly market update.
In agriculture, soybeans advanced, corn held steady and wheat softened following the latest WASDE report, which focused on projected US and global stockpiles at the end of the 2026–27 season. While leaving its export forecast unchanged, the USDA noted that China could step up purchases of US soybeans despite intense competition from Brazil’s record crop and lower export prices. Global wheat stocks declined for the first time in seven months from a four-year high, though ample supplies continue to weigh on prices.
Currencies
The yen firmed broadly again Tuesday and in Wednesday’s Asian session even as Japan’s markets were closed for trading Wednesday. USDJPY sliced all the way below 153.00 at its lows in the Asian session Wednesday before finding support, while EURJPY plunged as far as 182.22, eyeing the low of the year at 181.76 from late January.
The USD was mixed and not the focus Tuesday or early Wednesday as the Japanese yen stole the spotlight with its broad strengthening move. EURUSD rose back above 1.1900 after minor consolidation of Monday’s rally on Tuesday, while AUDUSD tested the waters above 0.7100, posting a new high since early 2023 at 0.7128 before finding resistance and trading back near 0.7100 late in Sydney Wednesday. USD traders await key US economic data as Wednesday sees the US January jobs report and Friday the US January CPI data.
