Market drivers and catalysts
Equities: Stocks rose across regions: U.S. tech led, Europe hit records on tariff relief, Hong Kong climbed on budget optimism.
Volatility: VIX softer but downside protection remains elevated ahead of US data and post-Nvidia follow-through
Digital Assets: IBIT and ETHA surge; crypto proxies firmer as risk appetite improves
Fixed Income: US Treasury yields rangebound, Japan’s JGB slightly weaker
Currencies: JPY erases some of Wednesday sell-off on BoJ rhetoric, USD weak.
Commodities: Gold and silver bottled up in range after silver breakout fails to follow through higher.
Macro events: US Weekly Jobless Claims, US Treasury to auction 7-year notes, Japan Tokyo CPI
Macro headlines
Nvidia, the world’s largest company by market cap, reported very strong earnings and forecasts Wednesday after the US market close, which initially saw the stock rising more than three percent in after-hours trading, though much of that move was later erased, suggesting concerns that the market is considering the longer term growth potential of the company relative to its valuation.
BoJ Governor Ueda hinted at a potential rate hike, keeping the March and April meetings open for action. Rate increases depend on hitting a 2% inflation target by late fiscal 2026, with the timeline potentially moved up by strong wage gains. Decisions will follow data analysis by March and April, amid speculation of an April hike. BoJ hawk Takata was also out arguing in favour of a rate hike.
US 30-year fixed mortgage rate fell to 6.09%, the lowest since September 2022, according to the Mortgage Bankers Association. Applications grew 0.4%, with refinancing up 4.1% but purchases down 4.7%. Lower rates help affordability, but home prices are higher than last year amid economic uncertainty.
Hong Kong's inflation rate fell to 1.1% from 1.4% in December. Price growth slowed in housing, food, and transport, with deeper deflation in durable goods and clothing. Utilities prices rebounded, while inflation increased for services and goods. Consumer prices rose 0.2% monthly, with underlying inflation at 1%, down from 1.2%.
Sentiment in Hong Kong improved as the 2026/27 budget projected an earlier-than-expected surplus. Financial Secretary Paul Chan announced measures to enhance the city's financial role and innovation. Q4 GDP growth hit 3.8%, the fastest in two years, with annual growth rising to 3.5% from 2.6% in 2024.
Germany's economy grew 0.3% in Q4 2025, rebounding from previous stagnation due to easing inflation and lower borrowing costs. Household consumption rose by 0.5%, government spending by 1.1%, and construction investment by 1.6%. Inventory and external demand slightly trimmed growth. Annually, Q4 growth was 0.4%, with full-year GDP up 0.2% after a 0.5% decline in 2024.
Macro calendar highlights (times in GMT)
0830 – ECB’s Lagarde to speak in Parliament
1000 – Eurozone Feb. Economic, Industrial, Service Confidence
1330 – US Weekly Initial Jobless Claims and Continuing Claims
1345 – US Fed’s Miran interview
1500 – US Fed’s Bowman to testify to Senate Committee on Regulation
1600 – US Feb. Kansas City Fed Manufacturing Activity
1800 – US Treasury to Auction 7-year Notes
2330 – Japan Feb. Tokyo CPI
2350 – Japan Jan. Retail Sales
2350 – Japan Jan. Industrial Production
0001 – UK Feb. GfK Consumer confidence
Earnings this week
Today: Deutsche Telekom, Schneider Electric, Rolls Royce Holdings, Intuit, AXA, Monster Beverage, Dell Technologies, Coreweave, Rocket Lab
Friday: BASF, Holcim, Swiss Re
For all macro, earnings, and dividend events check Saxo’s calendar.
Equities
USA: U.S. stocks advanced for a second day, with the S&P 500 up 0.8% at 6,946.13, the Nasdaq Composite up 1.3% at 23,152.08, and the Dow up 0.6% at 49,482.15, as investors leaned back into growth after this week’s AI (artificial intelligence) disruption jitters eased. Microsoft rose 3.0% and Palantir gained 4.2%, while Oracle added 1.2% after Oppenheimer & Co. upgraded its stock to outperform, Circle Internet Group jumped 35.5% after results beat expectations on strong stablecoin demand. After the close, Nvidia was little changed after beating estimates and reporting 75% data center growth, while Salesforce slid about 4% on softer revenue guidance, keeping Thursday’s follow-through test in focus.
Europe: European equities pushed to fresh highs, with the Euro STOXX 50 up 0.9% to 6,172.36 and the STOXX 600 up 0.7% to 633.47, while the UK’s FTSE 100 rose 1.2% to 10,806.41 as banks and AI-linked names led. HSBC jumped 7.9% after strong 2025 results and a more upbeat outlook, and ASML gained 2.0% as investors stayed focused on the AI investment cycle, payments group Adyen climbed 3.4% as risk appetite improved. The next catalyst was Nvidia’s earnings reaction and any new detail on U.S. trade policy after the “10% tariff” outcome looked less severe than feared.
Asia: Hong Kong stocks rebounded, with the Hang Seng Index up 0.7% at 26,765.72 and the Hang Seng China Enterprises Index up 0.3% at 9,034.75, while the Hang Seng Tech Index dipped 0.2% to 5,260.50. Sentiment improved after the 2026/27 budget pointed to an earlier return to surplus and leaned into “finance plus innovation,” while GDP (gross domestic product) growth was confirmed at 3.8% in Q4 and 3.5% for the full year. Haidilao climbed 6.2%, KE Holdings rose 5.6% and Meituan added 1.6%, as shipping and metals names such as Orient Overseas gained 1.9% on optimism tied to a proposed global metals trading zone.
Volatility
Volatility has cooled, but the market is not in “relaxed mode” yet. The VIX closed at 17.93 on 25 February, down on the day, while shorter-term gauges such as VIX1D (16.09) and VIX9D (16.28) suggest near-term event risk has eased somewhat. At the same time, the Cboe SKEW index at 146.05 indicates investors are still willing to pay up for downside protection. In plain terms: fewer fireworks expected day-to-day, but tail risks are not ignored.
SPX expected move (options-implied): roughly ±66 points, or about ±0.9%, into Friday 27 February, based on near-the-money weekly pricing in the attached options chain.
Skew check (today’s expiry): downside puts remain relatively more expensive than comparable upside calls, signalling continued demand for short-term protection into expiry rather than aggressive upside positioning.
Special focus – Nvidia: Nvidia reported strong earnings, but options markets had priced in a relatively modest post-earnings swing compared to prior quarters. That matters for investors because when a heavyweight like Nvidia moves in an orderly fashion, broader index volatility often stays contained. The key question now is whether the reaction spills over into the wider semiconductor complex or remains stock-specific.
Looking ahead, US initial jobless claims today and broader inflation signals later this week remain the main macro watchpoints. Any surprise in inflation or labour data could quickly reprice rate expectations and lift volatility again.
Digital Assets
Digital assets are attempting to stabilise after recent pressure. Bitcoin trades around $68,176, Ethereum near $2,063, with XRP firmer and Solana slightly softer. The broader tone is one of cautious recovery rather than full risk-on enthusiasm.
The listed spot wrappers are showing stronger momentum. IBIT is up 7.39% to 39.23, and ETHA up 11.76% to 15.68. That rebound is notable because ETF vehicles often act as a proxy for institutional engagement. A single strong day is constructive, but investors will want to see follow-through in flows to confirm that this is more than a short-covering bounce.
Crypto-linked equities are also firmer, including Coinbase and MicroStrategy, which typically move with amplified sensitivity to Bitcoin. Earlier options flow suggested investors were adding defined-risk protection in these names. If spot crypto continues to stabilise, some of that protection may eventually be monetised, potentially reinforcing the rebound.
Beyond price action, structural developments remain supportive. Tokenised US Treasuries have continued to grow in 2026, and regulatory experimentation around stablecoins in the UK adds to the longer-term infrastructure narrative. For investors, this reinforces that while prices remain volatile, institutional rails are still being built underneath the market.
Fixed Income
US treasury yields chopped around in the range, rising slightly on strong risk sentiment Wednesday and on soft demand for five-year notes at a Treasury auction, but falling again in Asian hours Thursday, leaving benchmark yields from 2-years out to 10-years about a basis point lower.
US High yield debt spreads versus US treasuries tightened on widespread strong risk sentiment Wednesday in the US. The Bloomberg measure we track of high yield spread to US treasury yields tightened Tuesday four basis points to 277 basis points.
Japanese government bonds sold off at the front end of the curve on a BoJ governor interview with BoJ governor Ueda suggesting openness for a further rate hike, as well as on a hawkish turn from known BoJ hawk Hajime Takata, who called for an additional rate hike and to communicate that price stability is almost achieved. The benchmark 2-year JGB yield rose more than a basis point to almost 1.24% while the benchmark 10-year JGB lifter about 1.5 basis points to above 2.15%, though pulling back from intrasession highs Thursday above 2.17%
Commodities
The Wednesday rally in gold and silver failed to find fresh fuel, as gold resistance remains in place above the 5,200 area, though the precious metal did come back from a dip late Wednesday, trading close to 5,200 late in Asian hours Thursday. Silver was choppier, finding itself back below 88 at one point early on Thursday in Asia after highs above 91 on Wednesday, trading 89.25 by afternoon hours in Tokyo.
Crude oil continues to trade nervously, unable to mount a charge on the recent highs as the world awaits Iran-US talks on Iran’s nuclear programme today and whether the massive US military presence around Iran will result in hostilities and a disruption of oil export flows from Iran and potentially other regional producers, should oil export flows through the Straits of Hormuz (about 25% of world export flows) be disrupted.
Currencies
The US dollar weakened late Wednesday and into the Thursday session, with the steep USDJPY rally Wednesday partially reversed (more below), while EURUSD slightly extended a move above 1.1800 and AUDUSD pulled sharply higher Wednesday and extended that move slightly in Thursday’s session, trading near 0.7130 and now not far from the three-year high posted earlier in February at 0.7147.
USDJPY and other JPY crosses saw steep Wednesday rally, driven by PM Takaichi nominating two dovish academics for BoJ positions, partially reversed as Bank of Japan governor Ueda indicated that the bank continues to eye the right timing for a rate hike and another hawkish BoJ member argued for a rate hike. USDJPY traded back below 156.00 after a test above 156.80 Wednesday.
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