January 19th Financial Breakfast: Several EU countries consider tariffs in retaliation against the US's tough stance; gold prices continue to hit new highs, potentially targeting $4700; oil prices focus on geopolitical risks.
2026-01-19 07:22:56
On Monday (January 19, Beijing time) in early Asian trading, spot gold opened and continued to refresh its historical high to $4,668.96 per ounce, and is expected to target $4,700 per ounce during the day. This is due to Trump's statement that countries opposing the US acquisition of Greenland will face high tariffs, and several EU countries considering imposing tariffs on €93 billion worth of US goods exported to the EU, leading to a resurgence of safe-haven demand. US crude oil is trading around $59.06 per barrel, with the market still worried about possible US military action against Iran, while also paying attention to the reactions of various countries to the situation in Greenland.
U.S. stocks closed virtually unchanged on Friday, with the market fluctuating ahead of the long weekend, but all three major indexes recorded declines for the week. The S&P 500 fell 0.06% to 6940.01 points, the Nasdaq fell 0.06% to 23515.39 points, and the Dow Jones Industrial Average fell 0.17% to 49359.33 points. For the week, the S&P 500 fell 0.38%, the Nasdaq fell 0.66%, and the Dow Jones fell 0.29%.
Healthcare stocks fell 0.8%, leading the decline among S&P 500 sectors. Chip stocks rose, with the semiconductor index gaining 1.2%. The financial sector edged up 0.1%, but recorded its biggest weekly drop since October, as Trump's plan to cap credit card interest rates at 10% sparked market concerns. Furthermore, Trump indicated he might want economic advisor Hassett to remain in his current position, reducing market bets on Hassett succeeding Powell as Federal Reserve chairman.
Last week, funds flowed from large-cap tech stocks to some undervalued sectors, with the Russell 2000 small-cap index hitting a new closing record on Friday, up 2.04% for the week. Earnings season kicked off last week, with banking results indicating a continued favorable overall economic environment. This week, earnings season will accelerate, with companies such as Netflix, Johnson & Johnson, and Intel releasing their results.
Investors were reluctant to make large bets ahead of the long weekend, but options market participants anticipated potentially greater volatility in the stock market after the monthly options expired. Historically, mid-January tends to be volatile, but market performance may improve towards the end of the month. Most major sectors of the S&P 500 closed higher last week, with real estate, consumer staples, and industrials leading the gains.
Gold prices fell more than 1% on Friday as investors took profits after recent record highs, while signs of easing geopolitical tensions diminished gold's safe-haven appeal. Spot gold fell 0.5% to $4,592.29 an ounce, after earlier dipping to $4,536.49. However, gold still rose about 1.9% last week, marking its second consecutive weekly gain.
Analysts point out that commodities retreated after several weeks of sharp rises, reflecting profit-taking. As protests in Iran subsided, US President Trump adopted a wait-and-see approach, and Russian President Putin intervened, geopolitical tensions eased, leading to a decline in geopolitical premiums for commodities such as gold.
The market expects the Federal Reserve to keep interest rates unchanged in the first half of the year, with the first rate cut likely in June. Analysts still believe gold prices have a chance to reach $5,000 this year, but significant pullbacks are possible along the way.
In other precious metals, spot silver fell 2.9% to $89.65 per ounce, but still rose more than 12% last week. Spot platinum fell 3.3% to $2,330.67, and spot palladium fell 0.6% to $1,790.78. A JPMorgan report stated that silver prices face risks such as easing supply in non-US regions, ETF outflows, and softening demand, potentially leading to a significant pullback.
Oil prices rose on Friday as some investors covered short positions ahead of the long U.S. weekend, while market concerns remained about potential U.S. military action against Iran. Brent crude rose 0.58% to settle at $64.13 a barrel, while U.S. crude rose 0.42% to settle at $59.44 a barrel.
Analysts pointed out that Friday's gains were mainly driven by short-covering buying ahead of the long weekend. Although the USS Abraham Lincoln is expected to arrive in the Persian Gulf next week, the situation does not appear likely to escalate sharply in the short term. Market concerns remain about Iran potentially blocking the Strait of Hormuz, which handles about a quarter of the world's seaborne crude oil shipments. However, potential increases in supply from Venezuela partially offset the geopolitical risks.
Earlier last week, oil prices hit multi-month highs due to protests in Iran and Trump's hints of possible military action. However, prices subsequently fell sharply by more than 4% on Thursday as tensions eased. Analysts said investors were reluctant to hold short positions over the long weekend, wary of unforeseen events. If the situation further deteriorates, market focus may shift to the prospect of Venezuelan sanctioned oil gradually returning to the international market.
The dollar strengthened on Friday as President Trump praised economic advisor Hassett and expressed his desire for him to remain in his post, reducing the market's perception that Hassett was less likely to succeed Powell as Federal Reserve chairman, which spurred dollar buying. The dollar index rose 0.06% to 99.41. The euro fell 0.1% against the dollar to $1.1594. Strong U.S. jobs data last week supported the dollar, and the market postponed its expectations for the first Fed rate cut until June.
Former Federal Reserve Governor Walsh is currently considered the leading candidate for Federal Reserve Chair. Analysts point out that Hassett is seen by the market as the most dovish and least independent of the candidates, and his reduced likelihood is providing support for the US dollar.
The yen rose 0.3% against the dollar to 158.16 yen. This followed warnings from Japan's finance minister that measures, including intervention, might be taken to address the yen's weakness. Markets are focused on the possibility that the Bank of Japan might raise interest rates sooner than expected to combat inflationary pressures from the yen's depreciation. Analysts believe the risk of intervention could increase significantly if the dollar/yen exchange rate rises to the 160-162 range.
Trump to personally attend Davos Forum to announce new housing policy; several high-ranking US officials to accompany him.
U.S. President Donald Trump will personally lead a delegation to the World Economic Forum in Davos, Switzerland, sources said Wednesday. Senior officials accompanying him include Treasury Secretary Scott Bessant, Commerce Secretary Howard Lutnick, Energy Secretary Chris Wright, Trade Representative Jameson Greer, and Special Envoy for the Middle East Steve Witkov. Trump stated on his social media platform Truth Social that he plans to outline new housing and affordability policy recommendations in his speech at the forum. Last year, while participating in the forum via video, he called on OPEC to lower oil prices, urged interest rate cuts, and warned global business and political leaders that products manufactured outside the United States would face tariffs. This will be Trump's first in-person attendance at the Davos Forum since returning to the White House for his second term. Last year, he addressed the forum via video on his fourth day in office.
British media: Several EU countries are considering imposing tariffs on €93 billion worth of US goods imported into the EU.
According to a report by the Financial Times on the 18th, several EU countries are considering imposing tariffs on €93 billion worth of US goods imported into the EU, or restricting US companies' access to the EU market, in retaliation for US President Trump's imposition of tariffs on eight European countries in exchange for Greenland. (Xinhua)
Data shows that energy and gold are the main drivers of US export growth during Trump's second year in office.
According to the latest statistics, the structure of U.S. exports underwent significant changes in the first year of President Trump's second term (January-October 2025). Hydrocarbons (including petroleum products, oil, and natural gas) and gold became the main drivers of growth, while the export position of the traditional pillar, automobiles, declined significantly. Specifically, aircraft ($125.7 billion), petroleum products ($89.6 billion), and oil ($84.9 billion) remained the top three export commodities. Natural gas exports increased to $67.2 billion, rising from fifth place to fourth. Gold exports surged by approximately 1.5 times to $62.6 billion, successfully entering the top five. In contrast, automobile exports fell from $51 billion a year ago to $45.3 billion, slipping from a long-held position in the top five to ninth place. Analysts believe that this structural change is closely related to the Trump administration's protectionist trade policies and tariff measures.
The US Commerce Secretary warned South Korea that if its memory chip manufacturers do not commit to increasing investment in the US, they could face tariffs of up to 100%.
U.S. Commerce Secretary Rutnick said on Friday that South Korean memory chip manufacturers could face tariffs of up to 100% if they do not commit to increasing investment in the United States. Rutnick stated, “Every company wanting to do memory chip business in the U.S. has two options: either pay 100% tariffs or build in the U.S. That’s industrial policy.” He did not name any specific companies. Currently, Trump has not imposed tariffs on most foreign-made semiconductor products, instead instructing Rutnick and U.S. Trade Representative Greer to negotiate with trading partners to reduce U.S. dependence on chip imports. The White House indicated earlier this week that Trump may announce new tariff measures and corresponding compensation plans in the “near future” to stimulate domestic manufacturing.
WHO: The US has the right to withdraw but must pay outstanding fees.
The United States is about to formally withdraw from the World Health Organization (WHO), but it has yet to pay its outstanding dues. On the 16th local time, WHO spokesperson Lindmeier stated that the US has the right to withdraw from the organization, but only if it pays its outstanding dues. Lindmeier said this matter is on the agenda of the upcoming WHO Executive Board meeting, and the WHO Secretariat will take appropriate action based on the Executive Board's recommendations. Lindmeier stated that the US has not yet paid its dues for 2024 and 2025. According to the WHO budget, the total amount of dues owed by the US for 2024 and 2025 is approximately $260 million. US President Trump signed an executive order on January 20th last year announcing the US withdrawal from the WHO. According to the WHO charter, a member state can only formally withdraw one year after submitting a withdrawal application. (CCTV)
US President's special envoy sets four clear conditions for Iran
U.S. Presidential Envoy Steve Witkov recently stated that Washington has set four clear conditions for resolving the conflict with Iran through diplomatic means: limiting nuclear enrichment activities; reducing the missile arsenal; disposing of existing nuclear material stockpiles (approximately 2,000 kg, enriched to 3.67%-60%); and restraining its regional proxy forces. Witkov warned that if Tehran does not meet these conditions, "the alternatives will be terrible." This statement has exacerbated regional tensions, with some Israeli media speculating that the U.S. may launch a strike against Iran in the near future.
my country's annual electricity consumption exceeded 10 trillion kilowatt-hours for the first time.
my country's National Energy Administration announced on the 17th that the country's total electricity consumption will historically exceed 10 trillion kilowatt-hours by 2025, reaching 10.4 trillion kilowatt-hours, a year-on-year increase of 5%. This figure is unprecedented among any single country globally, equivalent to more than twice the annual electricity consumption of the United States, and exceeding the combined annual electricity consumption of the European Union, Russia, India, and Japan. (Xinhua)
Technology-based SMEs will be included in the tiered cultivation program for high-quality SMEs.
The Ministry of Industry and Information Technology recently revised and released the latest "Administrative Measures for the Tiered Cultivation of High-Quality SMEs," which includes technology-based SMEs in the scope of the tiered cultivation of high-quality SMEs. Together with innovative SMEs, they serve as the foundation of high-quality SMEs, collectively referred to as technology- and innovative SMEs. The measures will take effect on April 1, 2026. (Xinhua News Agency)
Key Focus Today
stock market
U.S. stocks closed virtually unchanged on Friday, with the market fluctuating ahead of the long weekend, but all three major indexes recorded declines for the week. The S&P 500 fell 0.06% to 6940.01 points, the Nasdaq fell 0.06% to 23515.39 points, and the Dow Jones Industrial Average fell 0.17% to 49359.33 points. For the week, the S&P 500 fell 0.38%, the Nasdaq fell 0.66%, and the Dow Jones fell 0.29%.
Healthcare stocks fell 0.8%, leading the decline among S&P 500 sectors. Chip stocks rose, with the semiconductor index gaining 1.2%. The financial sector edged up 0.1%, but recorded its biggest weekly drop since October, as Trump's plan to cap credit card interest rates at 10% sparked market concerns. Furthermore, Trump indicated he might want economic advisor Hassett to remain in his current position, reducing market bets on Hassett succeeding Powell as Federal Reserve chairman.
Last week, funds flowed from large-cap tech stocks to some undervalued sectors, with the Russell 2000 small-cap index hitting a new closing record on Friday, up 2.04% for the week. Earnings season kicked off last week, with banking results indicating a continued favorable overall economic environment. This week, earnings season will accelerate, with companies such as Netflix, Johnson & Johnson, and Intel releasing their results.
Investors were reluctant to make large bets ahead of the long weekend, but options market participants anticipated potentially greater volatility in the stock market after the monthly options expired. Historically, mid-January tends to be volatile, but market performance may improve towards the end of the month. Most major sectors of the S&P 500 closed higher last week, with real estate, consumer staples, and industrials leading the gains.
Gold Market
Gold prices fell more than 1% on Friday as investors took profits after recent record highs, while signs of easing geopolitical tensions diminished gold's safe-haven appeal. Spot gold fell 0.5% to $4,592.29 an ounce, after earlier dipping to $4,536.49. However, gold still rose about 1.9% last week, marking its second consecutive weekly gain.
Analysts point out that commodities retreated after several weeks of sharp rises, reflecting profit-taking. As protests in Iran subsided, US President Trump adopted a wait-and-see approach, and Russian President Putin intervened, geopolitical tensions eased, leading to a decline in geopolitical premiums for commodities such as gold.
The market expects the Federal Reserve to keep interest rates unchanged in the first half of the year, with the first rate cut likely in June. Analysts still believe gold prices have a chance to reach $5,000 this year, but significant pullbacks are possible along the way.
In other precious metals, spot silver fell 2.9% to $89.65 per ounce, but still rose more than 12% last week. Spot platinum fell 3.3% to $2,330.67, and spot palladium fell 0.6% to $1,790.78. A JPMorgan report stated that silver prices face risks such as easing supply in non-US regions, ETF outflows, and softening demand, potentially leading to a significant pullback.
oil market
Oil prices rose on Friday as some investors covered short positions ahead of the long U.S. weekend, while market concerns remained about potential U.S. military action against Iran. Brent crude rose 0.58% to settle at $64.13 a barrel, while U.S. crude rose 0.42% to settle at $59.44 a barrel.
Analysts pointed out that Friday's gains were mainly driven by short-covering buying ahead of the long weekend. Although the USS Abraham Lincoln is expected to arrive in the Persian Gulf next week, the situation does not appear likely to escalate sharply in the short term. Market concerns remain about Iran potentially blocking the Strait of Hormuz, which handles about a quarter of the world's seaborne crude oil shipments. However, potential increases in supply from Venezuela partially offset the geopolitical risks.
Earlier last week, oil prices hit multi-month highs due to protests in Iran and Trump's hints of possible military action. However, prices subsequently fell sharply by more than 4% on Thursday as tensions eased. Analysts said investors were reluctant to hold short positions over the long weekend, wary of unforeseen events. If the situation further deteriorates, market focus may shift to the prospect of Venezuelan sanctioned oil gradually returning to the international market.
Foreign exchange market
The dollar strengthened on Friday as President Trump praised economic advisor Hassett and expressed his desire for him to remain in his post, reducing the market's perception that Hassett was less likely to succeed Powell as Federal Reserve chairman, which spurred dollar buying. The dollar index rose 0.06% to 99.41. The euro fell 0.1% against the dollar to $1.1594. Strong U.S. jobs data last week supported the dollar, and the market postponed its expectations for the first Fed rate cut until June.
Former Federal Reserve Governor Walsh is currently considered the leading candidate for Federal Reserve Chair. Analysts point out that Hassett is seen by the market as the most dovish and least independent of the candidates, and his reduced likelihood is providing support for the US dollar.
The yen rose 0.3% against the dollar to 158.16 yen. This followed warnings from Japan's finance minister that measures, including intervention, might be taken to address the yen's weakness. Markets are focused on the possibility that the Bank of Japan might raise interest rates sooner than expected to combat inflationary pressures from the yen's depreciation. Analysts believe the risk of intervention could increase significantly if the dollar/yen exchange rate rises to the 160-162 range.
International News
Trump to personally attend Davos Forum to announce new housing policy; several high-ranking US officials to accompany him.
U.S. President Donald Trump will personally lead a delegation to the World Economic Forum in Davos, Switzerland, sources said Wednesday. Senior officials accompanying him include Treasury Secretary Scott Bessant, Commerce Secretary Howard Lutnick, Energy Secretary Chris Wright, Trade Representative Jameson Greer, and Special Envoy for the Middle East Steve Witkov. Trump stated on his social media platform Truth Social that he plans to outline new housing and affordability policy recommendations in his speech at the forum. Last year, while participating in the forum via video, he called on OPEC to lower oil prices, urged interest rate cuts, and warned global business and political leaders that products manufactured outside the United States would face tariffs. This will be Trump's first in-person attendance at the Davos Forum since returning to the White House for his second term. Last year, he addressed the forum via video on his fourth day in office.
British media: Several EU countries are considering imposing tariffs on €93 billion worth of US goods imported into the EU.
According to a report by the Financial Times on the 18th, several EU countries are considering imposing tariffs on €93 billion worth of US goods imported into the EU, or restricting US companies' access to the EU market, in retaliation for US President Trump's imposition of tariffs on eight European countries in exchange for Greenland. (Xinhua)
Data shows that energy and gold are the main drivers of US export growth during Trump's second year in office.
According to the latest statistics, the structure of U.S. exports underwent significant changes in the first year of President Trump's second term (January-October 2025). Hydrocarbons (including petroleum products, oil, and natural gas) and gold became the main drivers of growth, while the export position of the traditional pillar, automobiles, declined significantly. Specifically, aircraft ($125.7 billion), petroleum products ($89.6 billion), and oil ($84.9 billion) remained the top three export commodities. Natural gas exports increased to $67.2 billion, rising from fifth place to fourth. Gold exports surged by approximately 1.5 times to $62.6 billion, successfully entering the top five. In contrast, automobile exports fell from $51 billion a year ago to $45.3 billion, slipping from a long-held position in the top five to ninth place. Analysts believe that this structural change is closely related to the Trump administration's protectionist trade policies and tariff measures.
The US Commerce Secretary warned South Korea that if its memory chip manufacturers do not commit to increasing investment in the US, they could face tariffs of up to 100%.
U.S. Commerce Secretary Rutnick said on Friday that South Korean memory chip manufacturers could face tariffs of up to 100% if they do not commit to increasing investment in the United States. Rutnick stated, “Every company wanting to do memory chip business in the U.S. has two options: either pay 100% tariffs or build in the U.S. That’s industrial policy.” He did not name any specific companies. Currently, Trump has not imposed tariffs on most foreign-made semiconductor products, instead instructing Rutnick and U.S. Trade Representative Greer to negotiate with trading partners to reduce U.S. dependence on chip imports. The White House indicated earlier this week that Trump may announce new tariff measures and corresponding compensation plans in the “near future” to stimulate domestic manufacturing.
WHO: The US has the right to withdraw but must pay outstanding fees.
The United States is about to formally withdraw from the World Health Organization (WHO), but it has yet to pay its outstanding dues. On the 16th local time, WHO spokesperson Lindmeier stated that the US has the right to withdraw from the organization, but only if it pays its outstanding dues. Lindmeier said this matter is on the agenda of the upcoming WHO Executive Board meeting, and the WHO Secretariat will take appropriate action based on the Executive Board's recommendations. Lindmeier stated that the US has not yet paid its dues for 2024 and 2025. According to the WHO budget, the total amount of dues owed by the US for 2024 and 2025 is approximately $260 million. US President Trump signed an executive order on January 20th last year announcing the US withdrawal from the WHO. According to the WHO charter, a member state can only formally withdraw one year after submitting a withdrawal application. (CCTV)
US President's special envoy sets four clear conditions for Iran
U.S. Presidential Envoy Steve Witkov recently stated that Washington has set four clear conditions for resolving the conflict with Iran through diplomatic means: limiting nuclear enrichment activities; reducing the missile arsenal; disposing of existing nuclear material stockpiles (approximately 2,000 kg, enriched to 3.67%-60%); and restraining its regional proxy forces. Witkov warned that if Tehran does not meet these conditions, "the alternatives will be terrible." This statement has exacerbated regional tensions, with some Israeli media speculating that the U.S. may launch a strike against Iran in the near future.
Domestic News
my country's annual electricity consumption exceeded 10 trillion kilowatt-hours for the first time.
my country's National Energy Administration announced on the 17th that the country's total electricity consumption will historically exceed 10 trillion kilowatt-hours by 2025, reaching 10.4 trillion kilowatt-hours, a year-on-year increase of 5%. This figure is unprecedented among any single country globally, equivalent to more than twice the annual electricity consumption of the United States, and exceeding the combined annual electricity consumption of the European Union, Russia, India, and Japan. (Xinhua)
Technology-based SMEs will be included in the tiered cultivation program for high-quality SMEs.
The Ministry of Industry and Information Technology recently revised and released the latest "Administrative Measures for the Tiered Cultivation of High-Quality SMEs," which includes technology-based SMEs in the scope of the tiered cultivation of high-quality SMEs. Together with innovative SMEs, they serve as the foundation of high-quality SMEs, collectively referred to as technology- and innovative SMEs. The measures will take effect on April 1, 2026. (Xinhua News Agency)
- Risk Warning and Disclaimer
- The market involves risk, and trading may not be suitable for all investors. This article is for reference only and does not constitute personal investment advice, nor does it take into account certain users’ specific investment objectives, financial situation, or other needs. Any investment decisions made based on this information are at your own risk.
