The US job market remains resilient, better than Wall Street expectations. Last week, the initial jobless claims in the US numbered 211,000, lower than the economists' expectation of 225,000, and decreased from the previous value of 220,000, unexpectedly dropping to the lowest level in nearly eight months. The number of continuing unemployment claims fell to 1.84 million, the lowest in three months. Following the data release, investors reduced their bets on Federal Reserve rate cuts, predicting nearly a 90% probability of no rate cut in January; US Treasury yields narrowed, closing nearly flat, while the USD rose over 1%, marking a more than two-year high.

The economic outlook for Europe is weak, with the manufacturing activities of the two largest economies in the Eurozone, Germany and France, continuing to contract in December. The December PMI for Germany was 42.5, below November's 43.0, and the PMI for France dropped to 41.9, marking the largest decline since May 2020. Italy also experienced a slowdown, while Spain's manufacturing continued to expand, indicating a continued growth momentum in Southern European economies. The British Pound fell nearly 1.2%, reaching the lowest in over eight months, and the Euro fell approximately 1% to the lowest in over two years.

Expectations for interest rates in Europe and the USA are diverging. The inflation risk potentially brought on by the tariff proposals made by Trump leads investors to believe that the rate cut from the Federal Reserve in 2025 may be smaller than previously expected. Meanwhile, the European Central Bank and the Bank of England's performance at the December meetings was dovish, with ECB Board Member Stournaras stating that rates are expected to reach around 2% by the autumn of 2025. Economists expect that the ECB will cut rates at every interest rate meeting before mid-2025.

Next week, key US data will include job vacancy figures, the ADP employment report, minutes from the Fed's December FOMC meeting, and the US non-farm payroll report. Mohamad Al-Saraf, the head of Forex at Danske Bank, warned that market expectations for the number of rate cuts this year may be too hawkish, and any negative US economic data could trigger a pullback for the USD.

On the first day of the New Year, US stocks experienced a "black opening", collectively opening high and then declining, particularly with the Nasdaq, which opened high but immediately turned to a drop, then rose over 1% before dropping over 1% again. The S&P and Nasdaq experienced five consecutive declines. During the last hour of trading, there was a wave of buying, and Small Cap stocks managed to close higher. Tesla, after falling over 7%, had its decline halved, ultimately closing down 6.08%; the Consumer Discretionary sector faced the largest decline, while Energy, Utilities, and Telecom sectors performed relatively well, boosted by rising oil and gas prices.

• The three major US stock indexes all fell. The S&P 500 Index closed down 13.08 points, a decline of 0.22%, recording 5868.55 points. The Dow, closely linked to the economic cycle, fell 151.95 points, a drop of 0.36%, closing at 42392.27 points. The tech-heavy Nasdaq fell 30.00 points, a drop of 0.16%, settling at 19280.79 points. The Nasdaq 100 fell by 0.17%. The Nasdaq Technology Market Capitalization Weighted Index (NDXTMC), which measures the performance of the Nasdaq 100's technology constituents, rose by 0.23%. The Russell 2000 Small Cap Index, more sensitive to economic cycles, rose by 0.07%. The fear index VIX rose by 3.40%, closing at 17.94.

• US stock sector ETFs experienced mixed performance. The Consumer Discretionary ETF fell by 1.32%, the Regional Banks ETF dropped by 1.23%, the Banks ETF declined by 1.01%, while the Financials ETF, Global Technology Stocks Index ETF, and Technology Sector ETF fell over 0.2%. The Internet Stocks Index ETF rose by 0.3%, the Biotech Index ETF increased by 0.53%, the Semiconductor ETF gained 1.08%, and the Energy Sector ETF rose by 1.19%.

• In research strategy, Bank of America's significant indicators for the U.S. stock market are just one step away from triggering a 'Sell' signal, with the 'Sell-Side Indicator (SSI)' increasing by 33 basis points to 57% in December, marking the highest level since early 2022.

• The 'Seven Sisters of Technology' saw mixed results, with Apple experiencing the largest monthly decline in three months. Tesla closed down 6.08%, marking the first annual decline in car sales in over a decade, and while fourth-quarter deliveries hit a record high, they still fell short of expectations, with Tesla having more than 7 million global owners. NVIDIA rose by 2.99%, Alphabet A rose by 0.07%. Meta increased by 2.34%. Amazon rose by 0.38%. Microsoft fell by 0.69%. Apple dropped by 2.62%, having announced a price reduction on its Chinese website—users can save up to 800 yuan by purchasing specified products through eligible payment methods.

• Chip stocks fluctuated. The PHLX Semiconductor Index closed up 0.83%, and NVIDIA's two-times leveraged ETF rose by 5.89%. Arm Holdings increased by 3.92%, Micron Technology rose by 3.77%, Marvell Technology improved by 2.82%, Taiwan Semiconductor gained 2.07%, ASML Holding rose by 1.06%, KLA Corp increased by 1.03%, Intel rose by 0.85%, Broadcom edged up 0.06%, Qualcomm gained 0.01%, while AMD declined by 0.13%, Wolfspeed fell by 0.45%, and Nanya Technology dropped by 2.24%.

• AI concept stocks were mixed. Serve Robotics rose by 9.33%. SoundHound AI, backed by NVIDIA, rose by 1.61%. BullFrog AI gained 4.5%, C3.ai rose by 0.7%, CrowdStrike increased by 1.51%, Dell Technologies climbed by 1.12%, while BigBear.ai fell by 7.64%, Super Micro Computer decreased by 1.41%, Palantir dropped by 0.58%, Oracle fell by 0.37%, and Salesforce dropped by 1.1%.

• China Concept Stocks mostly declined. The Nasdaq Golden Dragon China Index closed down 1.51% at 6661.14 points. Among ETFs, the FTSE China 3x Long ETF (YINN) fell by 5.48%, the China Technology Index ETF (CQQQ) decreased by 2.56%, and the China Concept Internet Index ETF (KWEB) fell by 1.78%. The FTSE A50 futures closed up 0.14% in the night session, reporting at 13086.000 points.

• Among popular China concept stocks, Fangdd Network rose by 6.8%, NIO increased by 4%, Li Auto rose by 0.13%, Alibaba gained 0.19%, whereas Bilibili dropped by 5.4%, New Oriental fell by 4%, ZEEKR declined by 4.44%, and Baidu, XPeng, NetEase, and JD.com at least fell by 1.2%.

• Bitcoin surpasses $0.097 million, and Cryptos stocks rise broadly. Ideanomics gains 455.56%, BTC Digital rises 13.81%, Canaan rises 8.29%, and Hut 8 increases by 6.83%.

• Quantum Computing concept stocks rose broadly, with SEALSQ Corp (LAES) up nearly 41%, Rigetti (RGTI) rising 31.06%, US stock Quantum Corporation (QMCO) closing up 0.93%, Quantum Computing (QUBT) closing up 13.32%, D-Wave Quantum (QBTS) up 14.40%, IonQ (IONQ) up 3.18%, Quantum ETF-Defiance ETFs (QTUM) up 1.55%, while Honeywell closed down 0.16%, and WiMi Hologram Cloud ADR fell 9.19%.

• Uranium and nuclear power stocks rise broadly. UEC rises 13.9%, NXE rises 10.45%, DNN is up 15.56%, Vistra rises 8.55%, and Canadian uranium stock Cameco CCJ rises 1.5%, as the company ceases production in a joint venture with Kazakhstan's state-owned uranium company Kazatomprom. TD Cowen believes this is favorable for competitors. Constellation (CEG) rises 8.44%, achieving its best single-day performance in three months with a $1 billion nuclear energy agreement with the US government.

• Among other key stocks: (1) The used car dealer Carvana falls 1.97%, with short-seller Hindenburg Research claiming the company is engaged in a "father and son team century accounting fraud." (2) Software stock Unity rises 9.08% after 'retail investors' group leader Keith Gill posts a mysterious message, prompting traders to engage in speculative trading.

European stock markets rise broadly at the start of 2025. The pan-European Stoxx 600 index closes up 0.6%, reversing earlier losses. The Danish index rises over 2%, and the UK index increases by over 1%. The Oil & Gas sector leads the gains with a 2.3% rise, followed closely by the utilities sector at 1.6%, while the banking and automotive sectors perform poorly:

• The pan-European STOXX 600 index closes up 0.60% at 510.67 points. The Eurozone STOXX 50 index rises by 0.24%. The FTSE Pan-European High Dividend 300 index increases by 0.68%.

• The German DAX 30 index closes up 0.58%. The French CAC 40 index rises 0.18%. The Netherlands AEX index increases 0.97%. The Danish OMX Copenhagen 20 index closes up 2.02%, and the Italian FTSE MIB index rises 0.55%. The UK FTSE 100 index closes up 1.07%. The Spanish IBEX 35 index rises by 0.71%.

US employment data exceeds expectations, leading investors to reduce bets on Federal Reserve interest rate cuts. On Thursday, US Treasury yields remain roughly unchanged, 10-year Treasury yields show intraday M-shaped fluctuations, and end slightly lower. The 10-year German Treasury yield experiences a V-shaped reversal, rising over 1 basis point for the day.

• US Bonds: At the end of the New York session, the yield on the benchmark 10-Year Treasury Notes fell by 0.80 basis points to 4.5610%, trading within a range of 4.5973%-4.5148% during the day. The yield on the 2-Year Treasury Notes rose by 0.20 basis points to 4.2436%, trading within a range of 4.2023%-4.2663% during the day.

• European Bonds: At the end of the European session, the yield on the German 10-Year Treasury Notes rose by 1.2 basis points, while the 2-Year German Treasury yield rose by 1.8 basis points. The UK 10-Year Treasury yield rose by 2.6 basis points, and the 2-Year UK Treasury yield rose by 1.1 basis points. The French 10-Year Treasury yield rose by 3.1 basis points, and the Italian 10-Year Treasury yield rose by 1.3 basis points.

With better-than-expected US employment data, the USD rose over 1% during intraday trading on the first day of 2025, hitting a two-year high. Meanwhile, the economic outlook for the Eurozone appears weak, with the Euro falling over 0.8%, dropping below 1.03 for the first time since November 2022, while the British Pound fell nearly 1.2%, reaching an eight-month low. Bitcoin Futures rose over 4%.

• USD: The ICE USD Index rose by 0.70% to 109.243 points, with a trading range of 108.267-109.533 points during the day. The Bloomberg USD Index rose by 0.34% to 1314.09 points, with a trading range of 1306.84-1316.17 points.

• Non-US currencies: The euro fell 0.86% against the dollar, reporting at 1.0267, the pound fell 1.09% against the dollar, reporting at 1.2381, and the dollar rose 0.66% against the Swiss franc, reporting at 0.9124; among commodity currencies, the Australian dollar rose 0.25% against the dollar, the New Zealand Dollar remained flat, and the dollar rose 0.10% against the Canadian dollar.

• Yen: The exchange rate of the dollar against the yen fell 0.18%, reporting at 157.52 yen, with an intraday trading range of 156.44-157.85 yen.

• Offshore Renminbi (CNH): The offshore Renminbi (CNH) against the dollar fell 42 points at the close, reporting at 7.3403 yuan, with an overall intraday trading range of 7.3161-7.3446 yuan.

• Cryptos: The largest cryptocurrency by market cap, Bitcoin, rose 4.15% at the close, reporting at $98,030.00, with an intraday trading range of $94,310.00-$98,735.00. The second largest, Ethereum, rose 2.97% at the close, reporting at $3,482.00.

Optimistic prospects for China's economy boost demand expectations, oil prices rise at the start of 2025, with WTI rising more than 2.8% reaching $73.70, and Brent nearly rising 2.6% approaching $76.60. The decrease in US EIA crude oil inventories by over a million barrels has limited impact on oil prices. Russia will halt natural gas transit through Ukraine to Europe starting January 1, leading to a rise in European natural gas.

• WTI: February crude oil futures rose by $1.41, an increase of 1.96%, reporting at $73.13 per barrel. WTI rose more than 2.8% during the session, reaching $73.70.

• Brent Oil: March Brent crude oil futures rose by $1.29, an increase of 1.73%, settling at $75.93 per barrel. During the trading session, Brent oil rose nearly 2.6%, approaching $76.60.

• Analysts pointed out that the U.S. ISM Manufacturing Index to be announced on January 5 will be a key factor affecting the next trend of crude oil.

• Henry Hub Natural Gas: U.S. February natural gas futures rose by 0.74%, settling at $3.6600 per million British thermal units. European natural gas prices rose over 4% at one point, refreshing the high since October 2023 to €51. Previously, the transit agreement expired, and Russia halted the transit of natural gas to Europe through Ukraine starting January 1.

With increasing geopolitical risks, Russia launched a drone attack on Kyiv on Wednesday morning, the Israeli army struck suburbs of Gaza City, and policy uncertainties increased on the eve of President Trump's inauguration. Driven by safe-haven bids, gold prices reached a new high in over two weeks on Thursday, with spot gold rising nearly 1.4% to above $2660, and futures gold rising over 1% to above $2670.

• Gold: COMEX gold futures were up 1.18% at the close, at $2672.00 per ounce. Spot gold rose nearly 1.4% to above $2660, closing 1.29% higher at $2658.46 per ounce.

• Silver: COMEX silver futures rose 2.58% at the close, reaching $29.995 per ounce. Spot silver peaked near $29.60, rising nearly 2.4%, and ended up 2.38%, closing at $29.5875 per ounce.

• In 2024, the global macroeconomic situation and geopolitical events are frequent, and the nonferrous commodity market performs strongly. The COMEX gold price surpassed $2800 per ounce in October, with an annual increase of over 27%; the Shanghai copper main contract also reached an all-time high, with an annual increase of over 32%. Despite the significant rise in Precious Metals, the prices of New Energy Metals like lithium carbonate remain low due to oversupply, putting pressure on related companies' performance. It is expected that the prices of nonferrous metal commodities will continue to diverge in 2025. CITIC SEC believes that the global central banks' gold purchasing behaviors are likely to continue, and the signaling effect of central banks announcing gold purchases may become more pronounced. Geopolitical conflicts in the Middle East and Russia-Ukraine could become more unstable in 2025, favoring an increase in gold prices. Under a neutral hypothesis, the COMEX gold futures price could reach above $3100 per ounce by mid-2025.

• Affected by the strong US dollar, most London Industrial Metals fell, with London zinc, London nickel, and London tin closing down more than 1.8% at most: London copper rose by $34, reporting $8802 per ton. COMEX copper futures rose by 0.21%, reporting $4.0350 per pound. London aluminum fell by $22, reporting $2529 per ton. London zinc fell by $52, with a decline of over 1.74%, reporting $2927 per ton. London lead fell by $18, reporting $1934 per ton. London nickel fell by $250, with a decline of 1.63%, reporting $15078 per ton. London tin fell by $526, down about 1.81%, reporting $28557 per ton. London cobalt remained flat, reporting $24300 per ton.

Editor/lambor