Three of the Magnificent 7 companies – and ASML – released their Q4 earnings yesterday and the numbers were ... mixed but hinted at strong AI spending and increased competition with Meta aiming to bring its AI model to a bullion users this year.
In China, Alibaba stepped out of the darkness saying that it’s AI model is the greatest of the world and is performing better than Meta and DeepSeek. A giant like Alibaba should be taken as a bigger threat than DeepSeek as the company can back it up with real-world applications and wide adoption.
Zooming out, the US equity markets were down yesterday, but the futures are up this morning. The Federal Reserve’s (Fed) decision went according to the plan. Fed members decided to maintain the rates where they are and seemed worried – and a bit confused – about inflation communication.
Beyond the borders, the Bank of Canada (BoC) cut its rate by 25bp BUT refrained from giving any guidance due to Trump uncertainties and the European Central Bank (ECB) will certainly announce a 25bp cut today, and repeat that if the data allows, there will be further support.
This report has been prepared by Swissquote Bank Ltd and is solely been published for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any currency or any other financial instrument. Views expressed in this report may be subject to change without prior notice and may differ or be contrary to opinions expressed by Swissquote Bank Ltd personnel at any given time. Swissquote Bank Ltd is under no obligation to update or keep current the information herein, the report should not be regarded by recipients as a substitute for the exercise of their own judgment.
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EUR/USD drops to fresh lows and challenges 1.0400
The US Dollar now gathers extra steam, sending the US Dollar Index (DXY) to fresh highs and forcing EUR/USD to dro to daily lows in the 1.0400 zone ahead of the release of the FOMC Minutes.
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Gold retreats, holds firmly above $2,920
Prices of Gold now face increasing selling pressure and recedes to the area of daily lows near the $2,930 level per ounce troy in response to the strong bounce in the Greenback, and mixed US yields.
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GBP/USD breaks below 1.2600 to print new weekly lows
The strong resumption of the selling bias in the risk complex and further recovery in the Greenback prompt GBP/USD to rapidly break below the 1.2600 support and hit fresh weekly lows on Wednesday.
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