As you can see from the accompanying table it was broadly a positive week for global financial markets. Central‑bank meetings, geopolitical developments and a heavy rotation of tech earnings were in focus.
In the U.S., equities touched recorded highs before ending the week softer, with large‑cap technology names delivering a varied set of results. Meta reported stronger‑than‑expected fourth‑quarter earnings supported by robust advertising revenue, while automaker, Tesla posted marginally better‑than‑expected results despite its first annual revenue decline. Microsoft, however, traded sharply lower as markets focused on a modest slowdown in cloud‑growth momentum, even though the company beat quarterly expectations.
Broader sentiment cooled through the week as geopolitical tensions rose, following U.S. threats to intervene in Iran over its nuclear ambitions and its crackdown on anti‑government protests. Oil and metals advanced in response but gave back some gains as tensions eased over the weekend.
The Federal Reserve held the federal funds rate at 3.5%–3.75%, as expected, following last year’s three rate cuts that brought borrowing costs to their lowest level since 2022. The majority judged current policy appropriate given stable economic activity, subdued job gains and early signs of unemployment stabilisation. Chair Jerome Powell noted that the U.S. economy enters 2026 on solid footing and that the present stance remains aligned with the Fed’s dual‑mandate objectives.
U.S. markets were reassured late in the week after President Trump nominated former Federal Reserve governor Kevin Warsh to lead the central bank when the current chair’s term ends in May. The nomination was viewed as reinforcing policy continuity and a continued data‑dependent approach at the Fed, helping stabilise rate expectations and support risk sentiment.
European equities ended higher as investors focused corporate‑earnings calendar and rising precious‑metal prices. Data revealed eurozone economy grew 1.5% in 2025, exceeding expectations as stronger investment, consumption, and exports offset political and economic uncertainty, with Germany, Spain, and Italy providing key support. Fourth‑quarter growth held steady at 0.3% quarter‑on‑quarter, pointing to a gradually improving backdrop.