Ankur Banerjee provides a preview of upcoming developments in European and global markets where non-dollar currencies show resilience amid concerns over inflation. The focus is on earnings reports and a softer U.S. reading fueling expectations for Fed rate cuts.
However, the optimism may be short-lived due to lingering inflation worries in the U.S., especially if the new Trump administration implements aggressive tariff and tax policies. Richemont's sales report is awaited to gauge high-end demand in the U.S. market and the impact of China's economic slowdown.
Additionally, attention is on the Middle East developments post-Gaza incidents. The recent U.S. core inflation figures helped boost sentiment, but analysts remain cautious about the high annual rate, possibly delaying Fed actions.
Upcoming earnings reports from Bank of America and Morgan Stanley, along with insights from Taiwan Semiconductor Manufacturing, will guide investment decisions. The surge in the yen, followed by expectations of a BOJ rate hike, and market reactions to Trump's upcoming policy statements are also crucial factors affecting global markets.
Noteworthy economic indicators expected on Thursday include Germany's inflation data for December, the UK's GDP estimate for November, and the Eurozone's trade balance for November.