MARKET WRAPS
Stocks:
European stocks were higher Tuesday, as the precious metals selloff reversed and against a supportive broader macro backdrop.
London-listed mining stocks rose in opening trade with the rebound in precious-metal prices.
Gold futures swung back toward $5,000 a troy ounce, and contracts for silver soared 13%, though prices for both remain markedly below peaks last week.
Positive news moving markets included Trump agreeing to reduce tariffs on imports of Indian goods to 18%, while the latest U.S. data showed factory activity unexpectedly expanded in January at the fastest pace in more than three years.
Stocks to Watch
LVMH's fashion and leather goods division should have sales rebound visibly this year, HSBC said.
"We are particularly enthusiastic on the comeback of Dior this year after a rough patch in 2024 and 2025."
Pandora is caught between a rock and a hard place, with volatile silver prices and challenges in consumer engagement, Jefferies said as it downgraded the stock to hold from buy.
"With silver now jumping around, we are reluctant to endorse an active recommendation subject to a special situation and volatile input."
Given the challenges of the last few months-even with more normalized silver prices-it estimated that forecasts for 2027 EBIT would be around 60% lower.
U.S. Markets:
Stock futures were mostly pointing to more market gains Tuesday.
Chip maker AMD is due to report, as are Pfizer and Merck, and Mondelez and PepsiCo.
Palantir jumped in off hours trading after issuing earnings late Monday.
Forex:
News that France has finally passed a budget should alleviate political headwinds facing the euro and was contributing to the single currency's rise , Monex Europe said.
The dollar slipped, losing ground in particular against the Australian dollar and the South Korean won.
Sterling was close to a five-month high against the euro and higher against the dollar.
The pound's positive correlation to risk sentiment has boosted the currency, reinforced by its break above the resistance level of 1.1550 euros, Convera said.
Bonds:
Treasury yields edged higher , with investors taking the fact that January's employment report won't be published as planned on Friday due to the partial government shutdown in their stride.
The Treasury yield curve maintained its steepening pattern, with the gap between shorter-and longer-dated bonds widening.
Eurozone government bond yields traded slightly higher.
The European Central Bank's meeting on Thursday remains the key focus for eurozone government bonds, even as the ECB is broadly expected to keep the key policy rates unchanged.
The spread between 10-year French and German government bond yields narrowed , as French fiscal worries calmed.
"Improved budget clarity and related shifts in investor positioning have supported the recent OAT-Bund spread tightening," the Investment Institute said, adding that further spread tightening was likely to be
Momentum has turned for Danish government bonds,
coinciding with the strengthening of the Danish krone, Nordea said.
Energy:
Oil prices slipped on signs of de-escalating tensions between the U.S. and Iran.
Officials from both countries are set to meet in Turkey this week.
"The market will be closely following these talks, given the risks that will re-emerge if they break down," ING said.
Meanwhile Trump agreed to reduce tariffs on India to 18% in exchange for New Delhi halting purchases of Russian oil.
"A lack of buyers means Russia would ultimately be forced to reduce output, tightening up the oil market."
Gas
European natural-gas prices fell as forecasts for milder weather in the coming weeks weighed on sentiment and concerns over the impact of a massive winter storm in the U.S. eased.
Metals:
Gold prices regained ground.
"Prices had previously moved well beyond levels typically associated with pure safe-haven demand linked to geopolitical or macro uncertainty, " Sucden Financial said.
"As a result, the correction appears less about uncertainty subsiding and more about excess positioning being cleared."
UOB said gold's recent era of sharp, relentless rallies might be over, based on technical analysis.
Spot gold broke below its 55-day exponential moving average on Monday for the first time since August 2025, a technical development that typically signals a pause in the prevailing uptrend.
Copper
Copper rebounded s upported by signs of buying from Chinese investors and reports that the government aims to expand strategic inventories.
"Manufacturers, who had been absent from the recent rally, emerged from the sidelines to buy copper at lower prices to help restocking inventories ahead of the Lunar New Year holiday," ANZ said.
"That is despite economic data showing factory activity remains weak."
A potential EU ban on importing platinum and copper from Russia could further tighten supplies, ING said.
The measures would primarily affect MMC Norilsk Nickel, Russia's largest mining company, which has so far been spared sanctions because of its critical role in global supply chains, according to ING.
"The potential ban comes at a time when markets for these metals are already tight."
Critical Minerals
Governments should stop shouting about their plans for strategic critical mineral stockpiles and just quietly get on with it, Wood Mackenzie said.
Flagging plans for stockpiles will spark a competition for minerals that inevitably pushes prices higher, it said, after a U.S. plan to stockpile rare-earths to counter China was announced.
EMEA HEADLINES
ECB Survey Records 'Unexpected' Tightening in Bank Lending
Eurozone banks tightened their conditions for loans to businesses in the final three months of 2025, an unexpected development lenders expect will continue in the early months of this year, the European Central Bank said Tuesday.
Publishing the results of a quarterly survey, the ECB said much of the tightening was reported in Germany and France, and "partly but not exclusively" involved loans to businesses that were affected by higher U.S. tariffs.
French Inflation Falls More Than Expected Ahead of ECB Meeting
French inflation fell more sharply than expected last month, raising further possibility that eurozone inflation could be below the European Central Bank's target for longer this year.
Consumer prices were 0.4% higher than in January 2025, down from a 0.7% increase in December, EU-harmonized figures published by statistics agency Insee showed Tuesday. A consensus of economists polled by The Wall Street Journal expected an increase of 0.6%.
Orsted Sells Onshore Business for $1.7 Billion After Judge Rules U.S. Wind Project Can Resume
Orsted agreed to sell its European onshore business in a $1.7 billion deal, a day after a U.S. judge ruled that the renewable-energy company could resume work at its Sunrise Wind project off New York's coast.
The Trump administration ordered a halt to construction of five U.S. offshore wind projects just before Christmas, including Orsted's Revolution Wind and Sunrise Wind projects, citing national security risks.
AstraZeneca's Initial Application for Lupus Injection Turned Down by FDA
AstraZeneca said the U.S. Food and Drug Administration rejected an initial submission for its Saphnelo lupus drug in injection form, and vowed to work with the regulator to move forward with an updated application.
The U.K. pharmaceutical company said Tuesday that the FDA issued a complete response letter, which indicates that a new drug application can't be approved in its present form, regarding Saphnelo for subcutaneous administration. The company said it subsequently provided information requested in the letter and that it was committed to working with the FDA to progress the application as quickly as possible.
GLOBAL NEWS
U.S. Manufacturing Is in Retreat and Trump's Tariffs Aren't Helping
The manufacturing boom President Trump promised would usher in a golden age for America is going in reverse. After years of economic interventions by the Trump and Biden administrations, fewer Americans work in manufacturing than any point since the pandemic ended.
Manufacturers shed workers in each of the eight months after Trump unveiled "Liberation Day" tariffs, according to federal figures, extending a contraction that has seen more than 200,000 roles disappear since 2023.
U.S., Iran Poised to Meet for Talks
Senior U.S. and Iranian officials are poised to meet in Turkey this week, amid efforts by regional powers to craft a diplomatic alternative to a clash that risks sparking broader turmoil.
U.S. special envoy Steve Witkoff and President Trump's son-in-law Jared Kushner were expected to join talks with Iranian Foreign Minister Abbas Araghchi in Istanbul on Friday, people familiar with the matter said.
Taiwan Doubles Down on U.S. Partnership, Even as America's Alliances Fray
TAIPEI-Many of America's longtime trade and security partners, contending with a new era of uncertain U.S. relations, have looked to hedge their reliance on Washington, in some cases warming up to Beijing.
For Taiwan, as with other U.S. security partners in Asia, giving up on America isn't an option.
Trump Pushes House Republicans to End Partial Shutdown Quickly
WASHINGTON-President Trump demanded Monday that House lawmakers back the bipartisan spending deal passed by the Senate last week and set aside policy demands in an effort to quickly end a partial government shutdown.
"We need to get the Government open, and I hope all Republicans and Democrats will join me in supporting this Bill, and send it to my desk WITHOUT DELAY," Trump posted on Truth Social. "There can be NO CHANGES at this time."
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02-03-26 0519ET
