MARKET WRAPS
Stocks:
European shares were mixed Wednesday with Trump's designs on Greenland and inflation figures front of mind for investors.
Gains for defense stocks on increasing geopolitical tensions were countered by falling energy stocks in early trade.
Oil prices fell after Trump said Venezuela would give the U.S. up to 50 million barrels of sanctioned oil, a move expected to deepen global oversupply .
Below-forecast German inflation data Tuesday pointed to a likely decline in the eurozone reading, due out this morning.
Deutsche Bank Research said lower inflation raised the possibility that the European Central Bank's next move could be a rate cut , rather than a hike.
Crucial jobs data is due out of the U.S. later.
Shares on the Move
European oil stocks slid in opening trade as investors worried about Venezuelan oil flowing into an already saturated market.
BP, Harbour Energy, Shell, Repsol, Eni and TotalEnergies all traded down.
UBS said European oil majors were likely to slow their quarterly share repurchases .
Stocks to Watch
HSBC's non-interest income growth momentum was likely to remain strong in 2026 and 2027, DBS Group Research said, raising its earnings expectations and target price for the stock.
Vodafone can secure better profitability in the years ahead, Berenberg said, lifting its rating on the stock to buy from hold.
"Vodafone can now deliver sustainable free cash flow and dividend growth in the coming years."
Carlsberg could guide to full-year 2026 organic operating profit growth of 3%-7%, Deutsche Bank said, rasing its target price on the stock.
The bank estimates 7.6%, citing the company's track record of conservative guidance and over-delivery.
Magnum Ice Cream has performed well since its listing, but there is still a bit of opaqueness on its earnings and cash projection at the moment, Jefferies said.
Market Insight
Pricing in the U.K. grocery sector will continue to be a key focus for investors, Citi said.
Morrisons dropped prices across various categories last week, while Tesco said it would keep prices low on branded products. Citi said both moves signaled that price competition was ramping up .
U.S. Markets:
Stock futures were mostly down after the Dow and S&P 500 rose to new records in Tuesday's session, lifted by broad-based gains across healthcare and smaller technology names.
December's ADP employment report and the JOLTS report for November are due out today, ahead of Friday's official employment data.
Further signs of labor market weakness could prompt markets to bring forward the expected timing of the next rate cut.
Forex:
The euro was lower and could lose a little more ground if the eurozone inflation data are weak and dampen expectations for rate cuts.
Commerzbank said moves would likely be limited as the euro had already started falling Tuesday after lower-than-expected German and French inflation figures.
Sterling fell . Monex Europe said the U.K, currency should be led by risk sentiment and the dollar's performance Wednesday as U.S. economic data are in focus.
The dollar traded steady ahead of U.S. jobs data that could provide clues on the timing of the Federal Reserve's next rate cut.
MUFG said the greenback was at risk of falling if the Supreme Court rules against the legality of Trump's use of emergency powers to impose sweeping tariffs in a potential decision Friday.
Bonds:
Eurozone government bond yields fell , extending the previous day's moves following weak inflation data from Germany.
Treasury yields traded lower in the Asian afternoon, reversing the previous day's moves amid caution ahead of the labor market data.
The trend of Treasury yield-curve steepening is continuing.
Amid concerns about the risks of stagflation, short-dated Treasury yields remained well anchored while long-dated Treasury yields edged higher, First Abu Dhabi Bank noted.
Goldman Sachs said the inflation outlook suggests that economic growth will be the dominant driver of government bond yields in 2026, reinforcing the hedging benefit of bonds .
Energy:
Crude futures fell following Trump's promise to extract oil from Venezuela.
"Oil prices extended their decline as the U.S. moved to tighten its grip on Venezuela's oil industry, adding to pressure from an already oversupplied global market," MUFG said.
Trump is set to meet American oil executives on Friday to discuss investments in Venezuela's oil sector.
"While Venezuela now accounts for only about 1% of global supply, uncertainty over its exports has added to bearish sentiment ," MUFG added.
Metals:
Gold slipped as investors booked profits and turned their focus to key U.S. economic data due this week.
U.S. actions in Venezuela injected a new wave of volatility into global markets, boosting the appeal of safe-haven assets this week.
Sucden Financial said it expected prices to be increasingly sensitive to profit-taking and shifts in liquidity.
Silver futures were down, while platinum climbed.
Copper
Prices slipped but continued to hold above the $13,000-a-metric-ton mark amid concerns over tightening supply and tariff uncertainty .
"The specter of U.S. copper tariffs remains a factor in the market because, whether or not they are implemented, we believe the elevated inventory in the U.S. is unlikely to be re-exported anytime soon if at all," RBC Capital Markets said.
Iron
Iron ore gained in early Asian trading. Market fundamentals remained broadly neutral, with elevated supply and rigid demand largely offsetting each other, Nanhua Futures said.
EMEA HEADLINES
German Unemployment Holds Steady
Germany's unemployment rate held steady in the last month of 2025, though actual jobless numbers inched higher, signaling an economy that still lacks momentum.
The seasonally adjusted unemployment rate was 6.3% in December, where it has been since March, data from Germany's Federal Employment Agency published Wednesday said, matching a consensus of economists polled by The Wall Street Journal.
Volvo Car Logs 2% Rise in Vehicle Sales in Final Month of Year
STOCKHOLM-Volvo Car said global sales rose 2% on year in December.
The Swedish automaker, which is majority-owned by China's Zhejiang Geely Holding Group, sold 75,049 cars in the month, up from 73,804 in the same month the year prior, it said Wednesday.
Orsted to File Additional Legal Challenge to Trump's Offshore Wind Halt
Danish energy company Orsted said it plans to file another legal challenge against a Trump administration order to halt construction of a U.S. offshore wind project.
The renewables company said Wednesday that its Sunrise Wind Project off New York's coast faces substantial harm from last month's stop-work order and that it would initiate preliminary legal proceedings in the U.S. District Court for the District of Columbia.
U.K. and France Agree to Set Up Military Hubs Across Ukraine After Cease-Fire
The U.K. and France will set up military hubs across Ukraine and build protected facilities to produce weapons and military equipment for the country if a cease-fire agreement is reached between Kyiv and Russia, British Prime Minister Keir Starmer said Tuesday.
The commitments, which offer some of the clearest details so far of the security guarantees Western allies will offer Ukraine, come as the U.S. continues its push for an end to the fighting between Russia and Ukraine.
GLOBAL NEWS
Global Markets, U.S. Futures Nervy as Geopolitical Tensions Sour Sentiment
Growing geopolitical tensions led to mixed performance in global markets and U.S. futures. President Trump's promise to bring 50 million barrels of Venezuelan oil to the U.S. brought oil prices-and energy stocks-down on oversupply fears, while a fresh war of words between China and Japan hit investor sentiment in Asia. Investors watch for jobs reports from the U.S., though Friday's nonfarm payroll print will provide a clearer clue on the timing of the Federal Reserve's next interest-rate cut.
-U.S. indexes were mixed premarket ahead of a busy day of jobs data. The Dow Jones Industrial Average gained 0.1% premarket after hitting a record high overnight, though futures for the S&P 500 dropped 0.1% premarket after reaching its own high. Momentum in technology stocks slipped across global markets, helping to drag the tech-heavy Nasdaq down 0.2% premarket.
Venezuela to Give U.S. Up to 50 Million Barrels of Oil, Trump Says
President Trump said Tuesday that Venezuela's interim authorities will give the U.S. between 30 million and 50 million barrels of sanctioned oil, with proceeds overseen by the White House to benefit both countries.
In a post on Truth Social, Trump said that he has directed Energy Secretary Chris Wright to carry out his plan for the oil to be taken by storage ships and transported to the U.S.
Supreme Court Sets Friday as an Opinion Day, Raising Prospects of a Tariff Ruling
The U.S. Supreme Court set Friday as an opinion day, raising expectations that the court could rule on the case regarding global tariffs President Donald Trump imposed using the International Emergency Economic Powers Act.
The court doesn't signal which decision or decisions it will render on a particular date. Rulings are issued at 10 a.m. Eastern time on decision days.
Bond Market Signals Go-Ahead For Bank Stocks with JP Morgan Earnings On Deck
U.S. bank stocks are powering higher to start the new year, supported by a surprisingly robust domestic economy, a renewed boom in global mergers, and a benign interest rate environment that should add to the financial sector's collective profit tally through 2026 and beyond.
(MORE TO FOLLOW) Dow Jones Newswires
01-07-26 0513ET
