Big Tech earnings and FOMC meeting coincide: the 'quarterly biggest hurdle'… the biggest factor for the New York Stock Exchange at the end of January

Source: BlockMedia Original Title: Big Tech Earnings and FOMC Meeting Overlap ‘Quarterly Critical Point’… The Biggest Variable for New York Stock Market at the End of January Original Link: The US stock market is approaching the busiest week of the first quarter of this year( from January 26 to 31), as it concludes January amid geopolitical uncertainties and dollar weakness debates. With the Federal Reserve’s January Federal Open Market Committee(FOMC) meeting and earnings reports from major companies like Microsoft, Meta, Tesla, and Apple scheduled simultaneously, investor caution is increasing.

New York Stock Market, Two Weeks of Decline

Last week, the New York stock market continued its decline for the second consecutive week. The S&P( 500 index fell by 0.4% weekly, essentially remaining flat, while the Dow Jones Industrial Average dropped by 0.7% over the week. The Nasdaq Composite index rebounded on Friday but still declined about 0.1% for the week. Geopolitical news and policy uncertainties since the beginning of the year have constrained risk asset preferences.

In the commodities market, natural gas prices showed a notable trend. As Arctic cold fronts and winter storms spread across the US, natural gas futures surged 75% in five days. This is seen as a short-term price spike caused by energy supply concerns.

Dollar Wobbles, Safe Assets Shift

Political and diplomatic issues also increased market volatility. At the World Economic Forum)WEF( in Davos, Switzerland, President Trump and European leaders reached an agreement on negotiations regarding Greenland, but differences in perceptions between the US and Western allies also emerged. During this process, doubts about the dollar’s safe-haven status resurfaced.

Macquarie’s global foreign exchange and interest rate strategist said, “While the Greenland agreement eased short-term tariffs and conflict concerns, it did not resolve the structural alienation between the US and its allies,” and added, “The market is beginning to reflect the possibility of a weakening dollar in a more fragmented global order.”

Indeed, in the foreign exchange market, the dollar showed a weakening trend. Over the past five trading days, the euro appreciated about 2% against the dollar, and the dollar fell more than 2.7% against the Swiss franc. It also declined about 1.8% against the yen, indicating that safe-haven preferences among global investors are diversifying into assets other than the dollar.

Fed Holds Steady, Big Tech Invests

Now, market focus is on this week. The Fed is likely to keep the benchmark interest rate unchanged at 3.5–3.75% at the January FOMC. According to CME Group, the market is pricing in a 97% probability of rate hold. However, discussions about the next Fed chair after Chair Jerome Powell’s term ends are emerging as a policy variable.

In terms of corporate earnings, the key factor is big tech’s AI)AI( investment plans. Microsoft, Meta, and Tesla will report earnings after market close on Wednesday, and Apple will release its earnings on Thursday. Meta has already raised its annual investment guidance to $70–72 billion, and Microsoft has announced that its 2026 investment will exceed $88.2 billion in 2025.

Such aggressive investments are also changing the funding structure. Recently, the total amount of investment-grade corporate bonds issued by tech companies over the past quarter has reached about $700 billion, approaching the financial sector. This indicates a shift in the landscape of the investment-grade bond market.

Some analysts warn about valuation pressures. “AI is a fundamental technological innovation, but unlimited spending and overvaluation risks cannot be ignored,” they say. Rising electricity costs from data center expansion and social burdens are also emerging as new variables facing tech companies.

Gold and Metal Rally, Supercycle Begins

Meanwhile, in the context of geopolitical uncertainties and dollar weakness, the metals market continues its bullish trend. Gold prices rose about 8% last week, surpassing $4,900 per troy ounce, with target prices raised to $5,400. Silver prices exceeded $100 for the first time ever, and platinum has gained over 30% since the start of the year.

Industrial metals are also rising amid expectations of increased demand. Copper, driven by data center needs, has continued its upward trend since the beginning of the year, and prices of lithium and tin have surged significantly. HSBC metal analysts said, “The energy transition and AI infrastructure demand are opening the possibility of a supercycle in some metal markets.”

As the last week of January begins, global financial markets are expected to once again test their directionality, centered on the Fed’s policy stance and big tech earnings. Investors are paying close attention to whether large-scale AI investments can translate into real growth and productivity.

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