Global equities started the week on a positive note but later reversed gains as mixed U.S. economic data sparked concerns over labor market health and persistent geopolitical tensions. PMI data indicated higher momentum in the American services sector, while employment data indicated slowing growth in jobs creation. President Trump’s advocacy for a higher military budget assisted in the recovery of defense stocks. The president also advocated for affordable housing with the federal purchase of mortgage-backed securities, which impacted housing related stocks.  

In global geopolitics, a Russian strike hit infrastructure in Lviv early Friday, while drone attacks left two southeastern regions in blackout. President Zelenskiy accused Moscow of using winter as a weapon to weaken Ukraine instead of pursuing U.S.-led diplomatic solutions to the conflict. After being captured by U.S. forces in a weekend military operation in Caracas, Venezuela’s ousted president and his wife appeared in a federal court in New York City on Monday. President Trump has announced that the second wave of attacks on Venezuela have been cancelled due to the cooperation by the interim government. President Trump has however suggested military and economic actions against Iran if protestors in the country are harmed by the government.

Global Updates
  • The MSCI All Country World Index rose early in the session but later reversed gains, as investor sentiment weakened amid mixed U.S. labor data and geopolitical tensions. 
  • Germany’s annual inflation rate fell to 1.8% in December, below market expectations.
  • MiniMax Group surged 78% on its Hong Kong debut after raising HKD 4.8 billion for R&D, outshining Zhipu AI’s earlier 13% gain as investor demand soared.
  • Saudi Arabia will open its capital markets to foreign investors starting February 2026, removing QFI restrictions in a bid to boost liquidity.
  • At least 80 people, including civilians, were reported as casualties in Venezuela following a U.S. attack. 
  • OPEC+ has decided to pause oil production increases during the first quarter of 2026 due to seasonal factors and geopolitical concerns.
  • Russian drone strikes on Kyiv early Friday killed four people and injured 19, causing severe damage to homes, as per Ukrainian officials.
  • A Russian strike hit infrastructure in Lviv as overnight drone attacks left two southeastern regions in blackout. President Zelenskiy accused Moscow of weaponizing winter instead of pursuing diplomacy.
  • India’s trade pact with the U.S. stalled, resulting in failed talks and higher tariffs on Indian goods, partly due to disputes over Russian oil purchases.
U.S. Equity
  • U.S. equity markets rose earlier in the week, but declined over the week reacting to mixed economic data and President Trump’s remarks on defense companies and institutional investors. The Dow Jones index closed above the 49,000 benchmark for the first time on Tuesday. The market remained subdued on Thursday as investors awaited the key December jobs report and a potential Supreme Court decision on President Trump’s “Liberation Day” tariffs.
  • ADP private payrolls data indicated that private sector employment in the US rose by a slower than expected 41,000 jobs in December and annual pay was up 4.4%.
  • U.S. JOLTS Job Openings data declined to 7.14 million in November falling short of the 7.6 million expected. 
  • U.S. ISM Services PMI rose to 54.4 in December from 52.6 in November, indicating a strong momentum in the services sector at the year end. 
  • Dow Jones has entered an exclusive partnership with Polymarket to integrate real-time prediction market data across outlets like The Wall Street Journal, Barron’s, and MarketWatch, including new consumer tools. 
  • US markets reacted sharply after Trump vowed to curb institutional purchases of single‑family homes and restrict defense contractors’ buybacks and dividends, triggering steep declines in housing and defense stocks led by Blackstone and Lockheed Martin. However, defense stocks recovered following President Trump’s advocacy for raising the Military Budget in 2027 to $1.5 Trillion. President Trump also advocated for the purchase of $200 billion in mortgage‑backed securities by the federal government to bring down mortgage rates and ease worsening housing affordability pressures.
  • Rio Tinto and Glencore have resumed talks to merge their businesses into the world’s largest mining company. Currently Rio Tinto’s capitalization is estimated to be $137 billion and Glencore at $70 billion. 
  • Nvidia and AMD stock rose this week after the companies displayed their next generation of AI chips at the Consumer Electronics Show in Las Vegas.
Fixed Income
  • The Bloomberg U.S. Aggregate Bond Index edged lower over the week.
  • The U.S. 10-year Treasury yield edged down to 4.183% and the yield on the 2-year note edged up to 3.488% over the week.
  • The U.S. Dollar Index rose to 99.01 over the week.

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