Precious metals fluctuated. Gold and silver had risen on Monday after the US capture of Venezuela’s President Nicolas Maduro. Oil steadied after the biggest gain in a week.
Equity traders appear largely unfazed by tensions in Latin America, with markets extending a three-year bull run driven by demand for technology and artificial intelligence (AI)-linked stocks. Stocks have bounced back from April lows as rate cuts by the US Federal Reserve (Fed) and optimism around AI-supported earnings buoyed sentiment.
“The bullish case for equities remains intact,” said Adrian Helfert, chief investment officer at Westwood. “Broader market leadership should look past Venezuela entirely unless cascading geopolitical events emerge.”
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This is poised to be a “strong year” for risk assets — the triumvirate of easing fiscal, monetary, and regulatory policy should work together in a pro-cyclical way, Morgan Stanley’s Serena Tang and Seth Carpenter wrote in a note on Monday.
For stocks, the main themes, in the US especially, will be stronger earnings growth and broadening leadership, while AI financing and a revival of mergers and acquisitions will take centre stage in credit markets. The analysts are overweight on global equities.
“Macro concerns still matter, but micro will become a larger driver of asset returns in this cyclical recovery,” they said.
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The bullish attitude showed up in equity derivatives as well.
A “mix of momentum chasing and rebound plays reflects a more constructive tone than most of 2025, with sentiment and positioning turning decisively less bearish,” said derivatives strategist Chris Murphy of Susquehanna International Group, in a note on Monday. “That optimism is showing up clearly in options activity, where upside structures dominate and consistent with a market increasingly positioned for strength rather than defence.”
Markets closely followed the developments in Venezuela, with Brent crude rising 1.7% to US$61.76 ($79.15) a barrel. The country’s deeply discounted bonds traded higher after the capture of Maduro.
Elsewhere, Treasuries steadied on Tuesday after the 10-year yield fell three basis points on Monday, when a report showed US manufacturing activity shrank in December by the most since 2024. That supported the case for more easing by the Fed.
Key US economic data will likely shape the week ahead. In addition to the December jobs report, the Bureau of Labor Statistics will issue figures on Wednesday for November job openings, quits and layoffs. The Fed lowered its target band for short-term lending rates at its past three meetings in response to weakening labour market conditions, and officials are expected to reduce it further this year.
Later in the week, the US government will report on housing starts, while the University of Michigan issues its preliminary January consumer sentiment index.
“Even as geopolitics are once again top of mind for investors, we are reminded that this week offers an array of key fundamental updates,” wrote Ian Lyngen at BMO Capital Markets. That’s “still the most relevant wild card for the US economy and monetary policy”.
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Corporate news:
- Nvidia Corp’s highly anticipated new Rubin data centre products are nearing release this year and customers will soon be able to try out the technology, helping speed AI development.
- BlueScope Steel Ltd shares surged in Sydney after the company said it was considering a AUD13.2 billion (US$8.8 billion or $11.4 billion) takeover bid by US steelmaker Steel Dynamics Inc and Australian conglomerate SGH Ltd.
- Under Armour Inc jumped as much as 7.2% in late trading on Monday after Fairfax Financial Holdings disclosed a sizeable stake in the sportswear company.
- Intel Corp showed off laptop computers based on processors with a new design, part of the chipmaker’s effort to make its products competitive again.
Some of the main moves in markets:
Stocks
- S&P 500 futures were little changed as of 10.51am Tokyo time on Tuesday
- Japan’s Topix rose 1.3%
- Australia’s S&P/ASX 200 fell 0.2%
- Hong Kong’s Hang Seng rose 0.9%
- The Shanghai Composite rose 0.7%
- Euro Stoxx 50 futures were little changed
Currencies
- The Bloomberg Dollar Spot Index was little changed
- The euro was little changed at US$1.1723
- The Japanese yen was little changed at 156.52 per dollar
- The offshore yuan was little changed at 6.9794 per dollar
Cryptocurrencies
- Bitcoin fell 0.3% to US$93,797.17
- Ether fell 0.5% to US$3,220
Bonds
- The yield on 10-year Treasuries was little changed at 4.17%
- Japan’s 10-year yield declined 1.5 basis points to 2.105%
- Australia’s 10-year yield declined two basis points to 4.77%
Commodities
- West Texas Intermediate crude fell 0.5% to US$58.05 a barrel
- Spot gold fell 0.2% to US$4,441.76 an ounce
Uploaded by Tham Yek Lee
