Weekly Market Quick Re-Take - 3 to 7 February 2025

Weekly Market Quick Re-Take - 3 to 7 February 2025

The Weekly Market Quick Re-Take provides a concise recap of the past week’s most important market events, based on the Daily Market Quick Takes published throughout the week. This summary distills key movements across equities, volatility, digital assets, fixed income, commodities, and currencies, ensuring a structured and data-driven review of the latest market developments. All figures reflect market movements from their respective trading days, offering a clear and accurate snapshot of what shaped financial markets over the past week.
 

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Key Takeaways

• Equities: Nvidia rebounded, but Alphabet and AMD tumbled after weak earnings.
• Volatility: VIX spiked early, then retreated; VIX1D peaked intraday on Feb 6 but has reverted to 16.15.
• Digital Assets: BTC <$100K, crypto stocks down, speculation on US sovereign wealth fund involvement.
• Fixed Income: US 10-year yield fell below 4.50% (Feb 5), Japan’s yields hit highs (Feb 6), UK gilts rebounded post-BoE (Feb 6).
• Commodities: Gold near record highs (Feb 5), oil under pressure from tariffs, copper higher (Feb 5).
• Currencies: USD volatile but reversed losses, JPY surged on BoJ comments (Feb 6).

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Markets in Turmoil as Trump Tariffs Spark Volatility

Global markets faced turbulence as President Trump announced broad tariffs on imports from Mexico, Canada, and China, triggering retaliatory measures and heightened trade war fears. A partial reprieve came midweek when Trump delayed tariffs on Canada and Mexico by 30 days, easing investor concerns. European stocks hit record highs, while US equities remained mixed, weighed down by tech earnings and trade uncertainty.

Equities: Tariffs and Earnings Shake Markets

• US markets were volatile. Nvidia (+5.2% on Feb 5) rebounded on AI optimism, while Alphabet (-7.3% on Feb 5) and AMD (-8.7% on Feb 4) tumbled after disappointing earnings and guidance. Amazon (-4% post-market on Feb 6) dropped due to cloud concerns.
• European stocks surged, with the STOXX 600 (+1.3% on Feb 6) and DAX (+1.5% on Feb 6) hitting record highs, fueled by strong corporate earnings and a dovish Bank of England.
• Asia saw mixed performance. China’s CSI 300 (+0.69% on Feb 5) gained as AI stocks outperformed, while Japan’s Nikkei and South Korea’s KOSPI fell earlier in the week on renewed trade war fears.

Volatility: Spikes and Retreats

The VIX surged early in the week as markets reacted to tariffs but declined later, reflecting improved sentiment. At its peak, VIX1D spiked as high as +42% intraday on Feb 6, but it has since reverted to 16.15, indicating that the initial panic subsided. While short-term volatility saw sharp moves, broader measures suggest a return to more stable conditions as markets digested the news.

Digital Assets: Bitcoin Struggles Below $100K

Bitcoin faced pressure throughout the week, struggling to hold above $100K. On Feb 6, it traded at $96,980 (+0.43%), facing resistance near $98,000. Crypto stocks like Coinbase (-1.73% on Feb 6) and MicroStrategy (-3.34% on Feb 6) fell, despite speculation over potential US sovereign wealth fund involvement in crypto markets.

Fixed Income: Yields React to Trade and Policy Shifts

• US 10-year yields fell below 4.50% on Feb 5, as Treasury Secretary Bessent emphasized the administration’s goal to keep long-term rates low.
• Japanese bond yields hit new highs on Feb 6, driven by strong consumer spending data.
• UK gilt yields rebounded after the BoE’s rate cut on Feb 6, initially dropping before inflation concerns sent them higher again.

Commodities: Gold at Record Highs, Oil Pressured by Tariffs

• Gold hit an all-time high of $2,882 on Feb 5 before pulling back but remains on track for its sixth consecutive weekly gain.
• Oil fell for a third straight week, pressured by US tariffs on China and rising inventories. Brent crude was $74.67 (+0.51% on Feb 6).
• Copper prices rose on Feb 5, benefiting from strong Chinese demand and AI-driven industrial activity.

Currencies: USD and JPY in Focus

• The US dollar spiked early in the week but reversed losses as traders viewed Trump’s tariffs more as a negotiation tool than an all-out trade war.
• The Japanese yen strengthened sharply on Feb 6, briefly trading below 151.00 against the USD, driven by hawkish Bank of Japan rhetoric and falling US yields.

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For more related content about last week's events, see: Key stories from the past week

For a global look at markets – go to Inspiration.