Global markets mixed as commodities and Fed outlook drive sentiment

Global markets showed a mixed start to the week, as investors navigated shifting risk sentiment, commodity weakness, and expectations of tighter US monetary policy. US equities advanced to fresh highs, with the S&P 500 rising 0.60%, the Dow Jones Industrial Average gaining 1.10%, and the Nasdaq 100 up 0.70%, as easing pressure from last week’s sharp sell-off in precious metals and cryptocurrencies allowed investors to refocus on earnings momentum and large-cap leadership. According to Trading Economics, technology and growth stocks led the advance, with Apple jumping more than 3% and AMD and Micron surging close to 5% each, while Alphabet and Amazon traded higher ahead of earnings later this week. Cyclical sectors also supported gains, as industrials and financials strengthened, with Caterpillar climbing nearly 5%, while energy stocks lagged amid continued weakness in oil prices. Oracle edged lower after recent gains linked to its $50 billion capital-raising plans, and Nvidia slipped around 2% amid uncertainty over its stalled $100 billion OpenAI investment.

European equities edged higher as markets recovered from early losses, with the STOXX 50 and STOXX 600 both up 0.20%. Investor attention shifted back to corporate earnings, though expectations that newly nominated Federal Reserve (Fed) chair Kevin Warsh could adopt a more hawkish stance weighed on the dollar and pressured commodity markets, alongside lingering concerns over elevated AI valuations. Among gainers, AstraZeneca rose nearly 2% after beginning trading on the NYSE, Novartis gained 1.60%, Nestlé advanced 2.40%, SAP added 1.10%, Unilever climbed 2.10%, and Capgemini was up 1.20% following the sale of its US subsidiary.

Asian markets were broadly weaker on Monday, with mainland Chinese equities sliding to four-week lows. The Shanghai Composite fell 2.48%, and the Shenzhen Component lost 2.69%, pressured by heavy selling in mining and technology sectors. Precious metals extended a second day of declines, while AI-related names retreated amid concerns over elevated valuations. South Korea’s Kospi plunged more than 5%, triggering volatility controls on index futures as Samsung Electronics and SK Hynix came under pressure. Hong Kong’s Hang Seng fell around 2.20%, following mainland weakness, while Japanese markets were more subdued but still edged lower. A private survey in China offered a rare positive note, showing factory activity accelerated last month as manufacturers ramped up production and shipments ahead of the extended Lunar New Year holiday.

South African markets were also under pressure, reflecting global risk aversion and a firmer US dollar. The FTSE/JSE All Share and Top 40 indices extended recent losses, with mining stocks hit by retreating precious metals and broader volatility. The rand weakened to around R16.22 to the dollar in early trade amid dollar strength and Fed uncertainty, before recovering modestly to near R16.10 as selling pressure in metals eased and domestic data, including a pickup in the manufacturing PMI, offered partial support.

Commodities were broadly softer, with gold and silver falling sharply as investors scaled back safe-haven positions amid expectations of tighter US monetary policy. Crude oil declined around 5%, pressured by easing geopolitical risk premiums and demand concerns, while industrial metals, including copper, softened on reduced demand expectations ahead of the Lunar New Year and rising developed-market yields. Overall, commodities retreated across the board, driven by central bank dynamics, dollar strength, and profit-taking after recent rallies.