LONDON, Jan 13, 2026, 12:18 GMT
- Japan’s Nikkei surged 3.3% to hit record highs, boosted by a weaker yen ahead of U.S. inflation figures
- S&P 500 futures dip roughly 0.1% ahead of CPI data and bank earnings, with JPMorgan in the spotlight
- Brent edges up toward $65, driven by concerns over Iranian supply; gold remains close to record highs
Global stocks climbed Tuesday, fueled by a record surge in Tokyo as investors awaited U.S. inflation figures and the kickoff of major bank earnings. Japan’s Nikkei soared 3.3%, while the yen slipped toward 159 per dollar. IG strategist Chris Beauchamp described the market as “climbing and climbing” a fresh “wall of worry.” Gold hovered near $4,600 an ounce following a record high, with RBC’s Christopher Louney dubbing it a “catch-all” hedge. Reuters
The U.S. December consumer price index arrives Tuesday and might reshape expectations around the pace of Federal Reserve rate cuts. Analysts predict annual core inflation, excluding food and energy, will tick up to 2.7%. Traders also factored in President Donald Trump’s vow to impose a 25% tariff on any nation trading with Iran, coupled with fresh criticism of Fed independence.
JPMorgan Chase kicks off earnings season, with Bank of New York Mellon, Citigroup, and Bank of America close behind. After a sustained rally in equities, all eyes are on their guidance. Executives will also face tough questions about Trump’s proposal to cap credit-card interest rates at 10% for a year—banks say it risks cutting off credit to millions of households and small businesses.
In Japan, political moves pushed the yen beyond 159 per dollar, hitting its lowest since July 2024. Kyodo reported that Prime Minister Sanae Takaichi plans to dissolve the lower house and call a snap election, sparking talk of a “Takaichi trade”—where investors buy stocks on stimulus hopes as the yen slides. Nick Rees, head of macro analysis at Monex Europe, said, “Dollar/yen at 160 first is the obvious level.” Reuters
U.S. stock index futures edged lower ahead of the open. S&P 500 futures slipped roughly 0.1%, while Dow and Nasdaq contracts also showed modest declines as investors braced for the CPI report and JPMorgan’s earnings.
Markets have scaled back bets on Fed rate cuts in 2026 as recent data suggest the economy remains solid, pushing traders to delay the first cut from April to June, Bloomberg reported. “There’s always a chance” inflation surprises, said Roland Kaloyan, Societe Generale’s head of European equity strategy, as investors seek clearer signals for 2026. JPMorgan’s trading desk forecast the S&P 500 could jump up to 1.75% if the CPI report meets or beats expectations, but tumble as much as 2.5% on a hotter-than-expected reading. SWI swissinfo.ch
Pressure on the Fed has taken center stage in markets. The leaders of the European Central Bank, the Bank of England, and nine other central banks declared they “stand in full solidarity” with Fed Chair Jerome Powell, following threats of a criminal indictment from the Trump administration. The investigation officially concerns a headquarters renovation, but Powell dismissed it as a “pretext” for political pressure. Reuters
The dollar held steady following Monday’s retreat, as the yen plunged to record lows versus the euro and Swiss franc, prompting Japanese officials to monitor intervention closely. The euro traded near $1.17, with sterling around $1.35.
Oil prices climbed further, with Brent crude rising 1.7% to $64.93 a barrel, while U.S. crude hit $60.52 amid turmoil in Iran sparking supply concerns. “The oil market is building in some price protection” against geopolitical risks, said John Evans, analyst at PVM Oil Associates. Barclays put the Iran-related risk premium at roughly $3-4 a barrel — a cushion for uncertainty. Reuters
This setup leaves scant margin for a messy CPI print or cautious comments from banks. A hotter inflation number might drive yields up and weigh on richly valued stocks. Meanwhile, any new threats to Fed independence or tariff developments linked to Iran could rattle the dollar and risk appetite. If Japan steps in to slow the yen’s decline, that would complicate matters further.
