US stocks eventually managed to extend their recent winning streak in the wake of strong earnings reports from Alphabet-Google (up +7.30% week-over-week) and Amazon (up +9.49%). Yet equity markets had flickered on Thursday after FB-Meta Platforms announced disappointing earnings and forecast. The tech giant’s shares plunged -21.42% WTD (-29.51% YTD). More than $200bn went up in smoke in a single day (biggest one-day decline for a stock in US history).

In spite of this collapse, bulls got a wake-up call and Wall Street found a foothold on Friday, even though volatility remained elevated (VIX at 23.22). In the end, the S&P 500 rose +1.55% over the week. The Dow Jones Industrial Average added +1.05% or 364 points. The tech-heavy Nasdaq gained +2.38%.

European equity indices closed mixed. The MSCI EMU was down for the fourth straight week (-0.43%) as tensions between Russia and Ukraine showed no signs of abating. By contrast, the FTSE 100 finished in positive territory (+0.67%), helped by a robust performance in higher weighted banking and energy shares. In Asia, major equity indices bounced back. The Nikkei jumped +2.70%, the Nifty 50 gained +2.42%, while the Kospi Composite skyrocketed +3.26%. Markets in mainland China were closed for the Lunar New Year's eve.

Energy sector rally continues as WTI crude oil tops $90     

Once again, WTI Crude closed higher at $92.31 a barrel (+6.32%, seventh positive week in a row) as US stockpiles fell by 1 million barrels last week. It is the first time the WTI prices cross the $90 threshold since 2014. As a result, the energy sector led the pack this week (+4.94%), just ahead of consumer discretionary (+3.94%) boosted by Amazon and financials stocks (+3.51%) which benefit from rising interest rates. The US 10-year T-note yield popped to +1.92% (+14bps over the week), as nonfarm payrolls rose 467,000 in January, well above the 150,000 Wall Street estimate. Information technology also ended higher (+1.06%) though to a lesser extent as investors booked profit on Microsoft (-0.95%).

Three S&P sectors edged down by about 0.20%-0.25%: materials, real estate, and communication services, the latter being weighed by FB-Meta platforms’ descent into hell.

Bond yields climb again

Treasury yields continued to rise around the world amid positive jobs data and better earnings. Yield on German 10-year government bonds turned positive, topping +0.21% for the first time since the end of 2018 (+27bps for the week), as ECB President Christine Lagarde adopted a more hawkish tone than expected at the central bank's meeting on Thursday. The French OAT moved in line with German bonds (10-year yield at +0.65%, i.e. +28bps over the week).

Risky bonds plunged deeper in the red. Prices of IG corporate bonds fell -1.82% in Europe and -0.72% on the other side of the Atlantic. High-yield bonds followed suit (-1.39% in Europe, -0.19% in the US). On the flip side, emerging debt weathered the storm (+1.58% in local currencies) as the greenback reversed course (dollar index down -1.79% at 95.48), wiping out last week’s gains. Elsewhere, gold was up (spot price at $1,808.28/Oz, +0.93%).

Find over 8,000 ETFs with our screener.