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Your Newsletter at a Glance

• Nvidia Earnings on Watch: Investors look to Nvidia for clarity on the AI rally after concerns raised by China’s DeepSeek
• Wall Street Performance: S&P 500 and Nasdaq fall for a fourth day; Dow edges higher; Tesla plunges 8.4%
• Tariff Tensions: Trump reaffirms levies on Canada and Mexico, probes new copper duties
• Global Data Focus: Second GDP estimate, PCE report, plus key figures from Europe and Asia
• European Outlook: DAX advances on earnings and potential Ukraine-U.S. mineral deal
• Asian Markets: Shanghai Composite rebounds on tech gains; Nikkei dips amid global uncertainty
• Commodities: Oil near multi-month lows on demand worries; gold hovers below record highs; copper jumps on U.S. import probe
   

US Stock Futures & AI Landscape

US stock futures rose Wednesday as investors eyed Nvidia’s earnings, a potential pivot for AI. DeepSeek’s emergence stoked doubts about tech’s sustainability. Meanwhile, Q4 GDP and PCE data loom, shaping the market’s next steps.
 

Wall Street’s Mixed Session

Wall Street saw mixed action Tuesday, with the S&P 500 and Nasdaq posting fourth consecutive losses (down 0.47% and 1.35%), driven by ongoing tech weakness. Tesla tumbled 8.4%, losing its trillion-dollar valuation, while the Dow rose 0.37% on defensive buying.

The dollar index rebounded to 106.5 after consumer confidence slumped to 98.3, an eight-month low. Markets now anticipate two 25-basis-point Fed rate cuts this year. Adding pressure, Trump reaffirmed tariffs on Canada and Mexico, raising trade tensions.
 

10-Year Treasury Stabilizes

The yield on the 10-year Treasury steadied above 4.3% after five straight declines, as investors await Q4 GDP and Friday’s PCE. Renewed tariff threats from Trump spurred safe-haven buying, initially pressing yields lower.

Markets price in two Fed rate cuts this year, heightening focus on key data. Despite recent softness, yields remain historically high, reflecting lingering growth and policy uncertainties.
 

DAX Rises on Earnings & Minerals Deal

The DAX hit one-week highs near 22,600, supported by corporate earnings and a possible Ukraine-US minerals deal. Ukraine’s reported plan to grant U.S. mineral rights could finalize soon, though inflation concerns linger under Trump’s protectionist policies. Investors remain cautious.
 

Euro Nears One-Month High

The euro hovered near $1.05 after hitting a one-month high of $1.0528. Optimism stems from reports of a €200B German defense fund, indicating broader fiscal expansion. Likely chancellor Friedrich Merz has hinted at modifying the debt brake for tax relief and energy subsidies, boosting euro-area sentiment.

Meanwhile, ECB officials appear split on additional rate cuts: some favor further easing as inflation cools, while others urge caution amid nascent economic stability. Traders expect clarity at the next ECB meeting.
 

Shanghai Composite & Tech Rebound

China’s Shanghai Composite jumped 1.02%, ending a two-day slide, as tech stocks rallied on renewed AI optimism. Policymakers vowed stronger support for the private sector post-NPC, brightening business confidence.
 

Nikkei Slips, Awaits Data

The Nikkei 225 slipped 0.25% to 38,142, touching a three-month low on global growth concerns. Traders await Nvidia’s earnings for clues on the AI sector’s resilience, while upcoming Japanese data on industrial production, retail sales, and Tokyo inflation could shape the BOJ’s policy path. Investors remain cautious, with chip and AI stocks leading the downturn amid broader uncertainties over demand and cost pressures.
 

WTI Hovering Near $69

WTI crude held near $69, weighed by economic concerns and unsettled Chinese demand. Trump’s foreign policy moves, including a possible Russia-Ukraine peace accord, could ease sanctions on Russian oil, boosting global supply. However, additional curbs on Iranian flows and a possible OPEC+ delay in output hikes helped cushion prices.
 

Gold Near $2,910

Gold hovered near $2,910, retreating from a recent one-week high amid profit-taking and softer Chinese imports. Yet it stays near its record $2,950, buoyed by economic concerns and Trump’s tariff escalations. Fed rate cut bets also reinforce the metal’s safe-haven demand.
 

Copper Surges on Tariff Probe

Copper futures surged almost 4% near $4.70, a two-week high, after Trump launched a probe into tariffs on copper imports to boost U.S. output. This is viewed as part of a strategy to counter China’s dominance in key metals for EVs and defense.

Ample Chinese copper stocks loom, yet electrification demand and limited mining investment could support prices longer term. Inventories in China have tripled from early-year levels, though that may not fully dampen robust global demand.
 

AI Rally’s Next Catalyst

Investors remain divided on the AI rally’s durability, with DeepSeek’s rapid expansion fueling debate over market saturation. Nvidia’s earnings could clarify whether growth in AI chip demand has further room to run—or if caution prevails.
 

GDP & PCE in Focus

Markets await Thursday’s second estimate of Q4 GDP, which could revise the initial moderate growth figure. Meanwhile, Friday’s PCE price index—an inflation gauge closely watched by the Fed—will be crucial for monetary policy.

Investors currently price in two rate cuts this year, but any surprise in core inflation or overall expansion could shift expectations. Analysts see these data as pivotal for near-term market swings, potentially influencing equity valuations and risk appetite.
 

Trump’s Tariff Trajectory

President Trump’s vow to impose tariffs on Canada and Mexico after a one-month delay rekindles trade tensions, threatening supply chains reliant on North America. Combined with potential copper levies, the administration’s protectionist stance poses escalating cost pressures for global markets.
 

Europe’s Moderate Upside

European stocks outperformed in 2025, buoyed by mild weather and fiscal support. Still, analysts caution that soft inflation or weak manufacturing data could trigger a pullback. Germany’s proposed defense fund props up sentiment, but trade tensions remain unpredictable.
 

Broader Market Outlook

Global markets tread a fine line between growth optimism and policy risks. AI-focused firms await Nvidia’s results for clarity, while upcoming GDP and PCE data could guide central bank decisions.

Europe’s mood brightens on Germany’s fiscal push and potential Ukraine-U.S. resource deals, but U.S. tariffs loom large. Across Asia, China’s pro-tech stance lifts sentiment, yet Japan awaits critical indicators. Policymakers’ next moves may determine if the current momentum endures.

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