General Market News

Private sector hiring nearly stalled in January 2026, with companies adding only 22,000 jobs according to ADP, falling short of the 45,000 forecast and below December's revised 37,000 gain. The weak report continues the lackluster trend from 2025, reflecting a low-hire, low-fire labor market that may prompt Federal Reserve officials to consider additional economic support.

• Excluding a 74,000 surge in education and health services, overall job growth would have been negative, with professional and business services losing 57,000 positions and manufacturing down 8,000
• Mid-sized companies (50-499 workers) drove all employment gains, while small firms remained flat and large employers cut 18,000 positions
• Wage growth held steady at 4.5% for workers staying in their jobs, unchanged from December despite the weak hiring environment

Clear Street, a securities and derivatives broker, is targeting a valuation of up to $11.8 billion in its U.S. IPO, aiming to raise up to $1.05 billion. The offering comes as the IPO market accelerates in early 2026, with eight companies set to raise at least $100 million each this week in what will be the busiest period for sizable offerings since 2021.

• Clear Street expects net revenue between $1.04 billion and $1.06 billion in 2025, up from $463.6 million in 2024, reflecting strong growth in the prime brokerage sector
• BlackRock-managed funds have indicated interest in purchasing up to $200 million worth of shares in the IPO
• The company will list on Nasdaq under the symbol 'CLRS' with Goldman Sachs, BofA Securities, Morgan Stanley, and UBS as lead underwriters

US stock futures showed modest gains Wednesday morning after a sharp tech selloff, with the S&P 500 down 0.8% and Nasdaq 100 falling 1.4% in the prior session. Software stocks bore the heaviest losses, with the software and services index declining over 12% across five consecutive sessions—its steepest drop since March 2020. Investors await key labor market data and corporate earnings amid concerns over AI-driven competition and pricing pressures.

• ServiceNow and Salesforce each dropped nearly 7%, contributing to a five-day losing streak for software stocks amid fears about competition and pricing power in an AI-driven market
• Advanced Micro Devices fell 9% after disappointing Q1 guidance, while Super Micro Computer surged over 10% on raised annual revenue outlook driven by AI server demand
• ADP private payroll data for January is expected to show 45,000 job additions, with official labor indicators delayed by a partial government shutdown

Global software stocks entered a second day of sharp declines after AI firm Anthropic released a new tool for automating work tasks, raising concerns about AI's impact on traditional software companies. Meanwhile, Walmart became the first retailer to reach $1 trillion market valuation, benefiting from its early AI adoption. The divergence highlights how AI is creating clear winners and losers within the tech sector.

• Since ChatGPT's launch, S&P 500 software and services stocks have turned negative while chip stocks have nearly tripled, showing investor discrimination between AI winners and losers
• Walmart hit $1 trillion market cap for the first time, joining tech heavyweight ranks after a year-long rally driven by AI integration in its operations
• Anthropic's new 'agentic AI' tool for task automation triggered the software selloff, with concerns spreading globally to affect software firms in India while Asian chip and hardware companies continued performing well

Euro zone inflation fell to 1.7% in January from 2% in December, dropping below the European Central Bank's 2% target for the first time in recent months. Core inflation also declined slightly to 2.2% from 2.3%. The data suggests the ECB will likely hold interest rates steady at its Thursday meeting.

• Headline inflation of 1.7% matched economist expectations and now sits below the ECB's 2% target
• Core inflation (excluding energy, food, alcohol and tobacco) eased to 2.2% in January from 2.3% in December
• The ECB is expected to hold its key interest rate at 2% when it meets Thursday, avoiding further rate cuts in the near term

Euro zone inflation fell to 2.4% in January from 2.5% in December, entering a 'soft patch' expected to last at least a year. Core inflation, which excludes volatile items, unexpectedly dropped to 2.2% from 2.3%, driven by easing services sector prices. The European Central Bank is expected to keep interest rates unchanged on Thursday and throughout the remainder of the year.

• Headline inflation dipped to 2.4% year-over-year in January, down from 2.5% in December, meeting economists' forecasts
• Core inflation (excluding energy, food, alcohol, and tobacco) unexpectedly declined to 2.2% from 2.3%, with services sector prices continuing to ease
• The ECB expects inflation to slightly undershoot its 2% target this year and next before returning to target in 2028, with economists split on whether the next move will be a rate cut or hike

The Nasdaq Index turned bearish after breaking below its 50-day moving average at 23,367.84, driven by fears that AI automation tools will disrupt traditional software business models. Major software stocks like ServiceNow, Salesforce, and Intuit have suffered steep year-to-date declines of 28%, 26%, and 34% respectively, while the VIX spiked above 20, signaling rising investor anxiety ahead of Amazon and Alphabet earnings.

• Tech sector selloff shows massive divergence as Nasdaq fell 1.4% while Dow hit record highs, with 'old economy' stocks like Caterpillar reaching all-time highs amid rotation out of technology
• Breaking below 50-day MA and January 20 support at 22,916.83 could accelerate downside toward December low of 22,692.00 or November low of 21,898.29
• VIX rose to 20.37 intraday (highest since January 21) before closing at 18.00, up 10.16%, indicating elevated hedging activity but not full panic as markets await Thursday's Big Tech earnings

Global software stocks experienced a second day of heavy selloffs following Anthropic's launch of a legal AI plug-in for its Claude chatbot, intensifying investor fears about AI disruption to traditional software business models. European analytics firms, Indian IT exporters, and Japanese software developers all declined sharply, with some stocks falling 3-13%. The selloff reflects broader concerns about a potential tech bubble and long-term competitive threats from AI-native companies.

• European legal analytics firms RELX and Wolters Kluwer hit new lows with 3% declines, while LSEG fell 6% after a 13% drop the previous day; Japanese developers NEC, Nomura Research and Fujitsu dropped 7-11%
• JP Morgan analyst noted investors have 'generally low' appetite to buy software stocks, citing risks from AI-native competition and clients building in-house AI solutions, with the sector being 'sentenced before trial'
• SAP dropped over 3% a week after losing approximately $40 billion in market value from disappointing cloud revenue forecasts, while advertising firms Publicis and WPP fell 5% and 3.3% respectively on AI exposure concerns

European stocks fell on February 4, 2026, with the STOXX 600 flat at 618.26 points as healthcare stocks dropped 1.9% following Novo Nordisk's weak forecast. The Danish stock index plunged 7.8%, heading for its largest daily decline since July 2025, while software and tech stocks continued sliding after Anthropic's AI plug-in launch raised concerns about disruption to the software industry.

• Energy stocks rose 1.3% on higher crude prices amid U.S.-Iran geopolitical tensions, helping offset broader market losses
• European tech and media stocks fell 0.3% and 0.5% respectively, extending Tuesday's steep declines triggered by AI competition fears
• Investors await January eurozone inflation data expected at 1.7%, below the European Central Bank's 2% target

Indian tech stocks plunged 6% on Wednesday, with the IT sub-index heading for its worst day since May 2022, following Anthropic's launch of AI automation tools that sparked concerns about AI-driven disruption in data and professional services sectors. The selloff mirrored losses in global software stocks as investors worried about the impact of Claude Cowork agent plug-ins on industry staffing needs.

• Anthropic released plug-ins for its Claude Cowork agent to automate tasks across legal, sales, marketing and data analysis, triggering a selloff among U.S. and European data analytics and software companies
• All 10 constituents of India's IT sub-index declined, with Persistent Systems down 7%, TCS falling 5.2%, Infosys dropping 5.8%, and Wipro declining nearly 4%
• The sharp decline reflects growing market concerns about AI automation displacing traditional IT services and professional staffing, particularly impacting India's major software services exporters

US stock futures stabilized on February 4, 2026, after a previous sell-off driven by AI concerns and diminishing expectations for an H1 2026 Fed rate cut. Dow Jones and Nasdaq 100 futures edged higher as USD/JPY climbed above 156, while traders await key US ISM Services PMI data, Fed speeches, and corporate earnings for direction. The outlook remains cautiously bullish, supported by expectations of multiple 2026 Fed rate cuts and strong corporate earnings.

• Japanese Services PMI rose from 51.6 to 53.7 in January, signaling strong economic momentum and a potentially more hawkish Bank of Japan policy stance, though yen weakness continued to support US risk assets.
• US ISM Services PMI is expected to decline from 54.4 to 53.5, with the Prices PMI forecast at 64.0 (down from 64.3), which could influence market expectations for an H1 2026 Fed rate cut.
• Technical levels show Nasdaq 100 trading below its 50-day EMA but above 200-day EMA, while Dow Jones and S&P 500 remain above both EMAs, indicating mixed near-term but positive longer-term outlooks.

Federal Reserve Governor Stephen Miran resigned from his position as chair of the White House's Council of Economic Advisers, ending an unusual arrangement where he held roles at both institutions simultaneously. Miran had pledged during his Senate confirmation to step down from the CEA position after his term ended on January 31. His departure comes as President Trump prepares personnel changes at the Fed, including nominating Kevin Warsh to replace Fed Chair Jerome Powell.

• Miran was appointed to the Fed's board in September after a Biden appointee resigned, but unusually took only unpaid leave from his White House CEA chair role rather than fully resigning
• Fed governors hold nonpartisan positions and vote on interest rate decisions and bank regulatory policy, making dual White House service controversial
• Trump has nominated Kevin Warsh to replace Fed Chair Jerome Powell whose term ends May 15, with speculation that Warsh may take Miran's seat before being elevated to chair

Senate Banking Committee Democrats are demanding a delay on Kevin Warsh's nomination as Federal Reserve Chair until DOJ investigations into current Chair Jerome Powell and Governor Lisa Cook are completed. Republican Senator Thom Tillis has also vowed to block the nomination until Powell's investigation ends, which could deadlock the committee given its 13-12 Republican majority requires unanimous party support to advance nominations.

• The Senate Banking Committee has 13 Republicans and 11 Democrats, meaning one Republican defection alongside all Democrats would deadlock Warsh's nomination and prevent it from reaching the Senate floor
• DOJ is investigating Powell for potential criminal wrongdoing related to cost overruns on Fed headquarters renovation, and separately probing Cook over unspecified allegations
• Democrats called the administration's criminal investigations of two sitting Fed board members 'dangerous and unprecedented' and an apparent effort to seize control of the central bank

Federal Reserve Governor Stephen Miran has resigned from his position as chair of the Council of Economic Advisers. Miran joined the CEA in January 2025 and became a Fed Board of Governors member in September 2025, filling a term that ended on January 31.

• Miran served dual roles as Fed Governor and CEA chair before stepping down from the White House position
• His term as a Fed Board of Governors member ended on January 31, 2026
• He had been with the Council of Economic Advisers for approximately one year before his resignation

Mining companies are generating strong cash flows as gold, copper, and silver prices rise, but many continue using outdated conservative pricing models that undervalue assets and constrain strategic decisions. Nicole Adshead-Bell of Palisades Goldcorp warns this disconnect between spot prices and consensus pricing assumptions risks capital misallocation. The sector is seeing renewed M&A activity, though generalist investors remain largely absent.

• Mining companies face an 'unfamiliar challenge' of managing abundant cash generation as metal prices surge well above the conservative pricing frameworks still used in analyst models, reserve calculations, and transaction valuations
• The gap between higher spot prices and lagging consensus pricing is causing companies to potentially undervalue long-life assets and miss opportunities to capture full economic potential during the cycle
• Royalty and streaming companies are positioned as key beneficiaries with high-margin models, while broader institutional participation remains limited with 'generalists not yet in the sector' despite improved fundamentals

U.S. stock markets fell on Tuesday, led by a sharp decline in software stocks amid growing fears about AI disruption. The tech-heavy Nasdaq dropped 1.4%, the S&P 500 fell 0.8%, and the Dow slipped 0.3%, while the VIX 'Fear Index' surged above 20, signaling rising investor unease.

• Software stocks were hammered by AI disruption concerns, with Intuit down over 11% and Salesforce falling nearly 7% after AI startup Anthropic released workplace productivity tools
• Tech giants also declined, with chip makers Nvidia and Broadcom each dropping about 3%, while most Magnificent Seven stocks shed more than 1%
• The sell-off lacked a clear trigger but appeared to accelerate year-to-date trends, with gold rising over 6% as investors sought safe-haven assets

South Korea's stock market is leading global equities in 2026 with the Kospi index up 25.5% year-to-date, vastly outperforming the U.S. S&P 500 which has nearly erased its 2026 gains. The surge is driven primarily by memory chipmakers Samsung Electronics and SK Hynix, which have each soared approximately 40% as they supply critical components for AI accelerators and data centers.

• Samsung and SK Hynix dominate the Kospi, comprising 22% and 15.2% of the index respectively, benefiting from global AI chip demand with SK Hynix being the sole memory chip supplier for Microsoft's Maia 200 AI chip
• South Korea faces renewed tariff risks as President Trump threatened to raise U.S. tariffs from 15% to 25% due to slow implementation of a July 2025 trade pact, though Korean stocks rose 2.7% to record highs following the announcement
• JPMorgan analysts project the Kospi could reach 6,000 to 7,500 this year after South Korean President Lee Jae Myung achieved his campaign promise to double the index to 5,000, with the market currently at 5,288

John Feneck, CEO of Feneck Consulting, argues that extreme volatility in gold and silver reflects a structural market shift rather than a bull market breakdown, following sharp retreats after both metals hit record highs in late January. He contends that volatility is now a defining feature of the precious metals cycle, driven by years of suppressed demand, underinvestment, and eroding confidence in fiat currencies.

• Silver broke through 11 years of resistance at $30 before pulling back sharply, while major banks forecast gold reaching $3,400-$6,000, though Feneck warns neither metal has 'set the floors yet' with potential support at $50-$55 for silver and higher expectations of $66-$70.
• Mining equities continue to lag metal prices significantly, which Feneck calls illogical, though recent large financings and deals signal renewed capital flowing into the sector after years of scarcity.
• Feneck criticizes the Federal Reserve for avoiding discussion of dollar decline and purchasing power erosion, arguing this remains a core driver of precious metals demand despite short-term corrections.

Investors are increasing bets on a steeper Treasury yield curve as incoming Fed Chair Kevin Warsh is expected to shrink the Fed's balance sheet while cutting short-term rates. This dual approach could push long-term yields higher while keeping short-term rates subdued, creating tensions between dovish rate cuts and tighter financial conditions. The strategy raises concerns about implementation challenges and increased rate volatility.

• The Fed's balance sheet currently stands at $6.59 trillion; reducing it would withdraw government demand for Treasuries, pushing long-dated yields higher and steepening the curve
• Markets still price in roughly two quarter-point rate cuts in 2026, with the first expected at the June 16-17 meeting, despite concerns about Warsh's policy shift from his previous hawkish stance (2006-2011)
• The Treasury 2/10-year yield curve hit 72.70 basis points on February 2, its steepest level since April 9, driven by inflation concerns and fiscal deficit fears even before Warsh's expected May confirmation

Novo Nordisk forecast a 5-13% sales decline for 2026, far worse than the expected 2% drop, triggering a selloff across obesity drug stocks. Eli Lilly fell 4%, while competitors Structure Therapeutics, Altimmune, Viking Therapeutics, and Amgen also declined. The disappointing outlook highlights intensifying competition and falling prices in the weight-loss drug market.

• Novo's fourth-quarter operating profit fell 14% to 31.7 billion Danish crowns, slightly beating the 31.2 billion crown estimate
• Wall Street analysts have slashed peak market forecasts from $150 billion to $80-105 billion by 2030 due to sharp U.S. price declines for GLP-1 treatments and increased competition in the cash-pay consumer market
• The broader selloff impacted major competitors, with Structure Therapeutics down 6.2%, Altimmune down 4.2%, and Viking Therapeutics falling over 3%