Closing Recap 

U.S. stocks kicked off the first full trading week of the new year with a powerful rally, as investors shrugged off geopolitical turmoil and embraced a risk-on mood. The Dow Jones Industrial Average surged to a new intraday record high above 49,000, driven by a powerful rotation into Financials and oil-related stocks. The gains were broad-based, with the S&P 500 climbing back above 6,900 and the Nasdaq also finishing strong. The primary catalyst was the U.S. military operation in Venezuela that resulted in the capture of President Maduro, a move that sent shockwaves through the commodity markets. Gold and silver surged on safe-haven demand, while oil company stocks were the day’s big winners. Despite the risk-on tone in equities, the U.S. dollar softened, while the Japanese yen gained on risk-aversion flows. 

Key Takeaways 

• Stocks Surge on New Year Positioning: U.S. stocks rallied to start the week, with the Dow hitting a new all-time high above 49,000 as investors deployed fresh capital. 
• Venezuela Shockwave Hits Markets: A U.S. military operation capturing Venezuelan President Maduro was the main story, boosting oil stocks, precious metals, and geopolitical uncertainty. 
• Gold and Silver Soar on Safe-Haven Bid: Gold futures surged 2.7% to settle above $4,450 an ounce, and silver jumped 7.5% as investors rushed into safe havens amidst the geopolitical turmoil. 
• January Seasonality Now in Focus: Despite the failed Santa Rally, the market now enters January, which is historically one of the strongest months of the year for stocks, with the S&P 500 rising 62% of the time.
• Oil Stocks Lead, Crude Rallies: Oil company stocks with Venezuelan exposure surged, adding over $60 billion in market cap. WTI crude gained 1.74% on the direct threat to a major oil producer. 
• Copper Hits Record High: Copper surged to an all-time high above $13,000 a ton, driven by fears that U.S. tariff policies are causing a rush to secure physical metal and draining global inventories. 
• Bitcoin Jumps to $94k: After a dismal 2025 where it lost 6.4%, Bitcoin is showing signs of life, rallying over 2.6% and starting the new year with five consecutive days of gains. The crypto market participated in the risk-on mood, with Bitcoin rallying to above $94,000 as it tracked gains in the tech sector. 
• CES and Jobs Data in Focus: The market is now looking ahead to a busy week, with the CES technology conference and a slate of key U.S. jobs data, including the December Jobs Report on Friday. 

Market Overview

The new trading year has kicked off with a geopolitical earthquake, but in a surprising display of resilience, U.S. stocks shrugged off the uncertainty and powered higher. The stunning news of a U.S. military operation in Venezuela has immediately reset the market narrative, shifting the focus from central bank policy to geopolitical risk. The immediate reaction was a flight to safety in precious metals, with both gold and silver soaring. However, the equity market chose to focus on the potential beneficiaries of the conflict, with oil company stocks leading a broad-based rally that took the Dow to a new record high. The session was a classic “buy the dip” and new-year positioning affair, with cyclical sectors like financials also seeing strong inflows. 

Index	Up/Down	%	Last
DJ Industrials	595.07	0.0123	48977
S&P 500	43.62	0.0064	6902
Nasdaq	160.19	0.0069	23395
Russell 2000	39.7	0.0158	2547

Despite the failure of the “Santa Claus Rally” for a third straight year, historical data for January is strongly bullish for stocks, a factor that is likely contributing to the positive sentiment. The tech sector also participated in the rally, with investors looking ahead to this week’s CES conference for the latest updates on AI from the CEOs of Nvidia and AMD. While the market’s initial reaction has been positive, the situation in Venezuela is a major wild card that could easily sour the mood if the transition proves to be anything but “safe and orderly.”

Economic Calendar 

The first full trading week of the new year is packed with key economic data, though today’s session will be dominated by geopolitical headlines and CES news. Data Released Yesterday / Overnight: 

• U.S. ISM Manufacturing PMI (Dec): Came in weaker than expected at 47.9, remaining in contractionary territory and reinforcing the case for a Fed rate cut. 
• Australian Services PMI (Dec): Slowed but showed rising price pressures, complicating the RBA’s outlook. 
• Japan’s Monetary Base: Contracted in 2025 for the first time in 18 years, reflecting the BoJ’s exit from ultra-loose policy. 

Today’s Economic Calendar: 

• European Session: An extremely light calendar with only French and German inflation data on the docket. 
• U.S. Session: The U.S. data calendar is empty, with the market awaiting key jobs data later in the week. 
• A heavy slate of Fed and ECB speakers is on the docket for later in the week.
• Key Events This Week: CES Technology Conference (All Week)
• U.S. December Jobs Report (Friday) 
• U.S. November JOLTS Job Openings (Wednesday) 
• U.S. December ADP Nonfarm Employment (Wednesday) 

Asset Class Spotlight: FX, Commodities, Bonds & Crypto

The big story in commodities is the powerful surge in Gold, Silver and Copper. Gold was the standout performer, with February futures surging over 2.7% to settle at $4,451.50 an ounce as investors rushed into the traditional safe haven amidst the Venezuela crisis. Silver and Copper have also seen massive gains, with copper hitting a new record high. Silver also jumped around 7.5%. Oil prices were also higher, with WTI rallying over 1.7% to above $58 a barrel. The market is pricing in a significant geopolitical risk premium, though JPMorgan analysts see a limited near-term impact on supply.

Asset	Up/Down	Unit / % Change	Last
WTI Crude	1	0.0174	58.32
Gold	121.9	0.0279	4451.5
EUR/USD	0.0006	0.0005	1.1726
USD/JPY	-0.66	-0.0042	156.15
Bitcoin	2,400+	2.6%+	93613
10-Year Note Yield	-0.026	-0.0062	0.04163

The U.S. dollar softened as the risk-on mood in equities took hold. The Japanese yen was the main outperformer on safe-haven flows. 

• USD/JPY: The yen strengthened, with the pair falling towards 156.15. The currency is benefiting from a flight to quality amid the geopolitical turmoil, while soaring domestic bond yields are also providing strong support.
• EUR/USD: The pair is trading with a positive bias around 1.1735 as the dollar gives back its initial gains. The divergent policy paths between a dovish Fed and a steady ECB continue to favor the single currency. A notable $957M options expiry at the 1.1770 level provides a key resistance point.
• GBP/USD: The pound has rallied to a fresh three-month high above 1.3550, driven by broad U.S. dollar weakness. 

Cryptocurrencies: The crypto market is showing resilience, with Bitcoin rising over 2.6% to trade above $93,000. The leading cryptocurrency is tracking the broader rally in technology stocks and finding some support from bargain buying after its poor performance in 2025. Influential analyst Tom Lee is also calling for new all-time highs soon. U.S. Treasury yields were slightly lower as investors sought the safety of government bonds. The benchmark 10-year yield fell, reflecting the ongoing uncertainty created by the geopolitical situation. 

Looking Ahead 

Today’s trading will be dominated by the market’s reaction to the fast-moving developments in Venezuela and headlines from the CES technology conference, where Nvidia and AMD are set to speak. Beyond that, the release of key U.S. jobs data, starting with JOLTS on Wednesday, will be the next major catalyst. A strong report could challenge the market’s dovish Fed narrative, while a weak print would all but guarantee further easing and likely fuel the next leg of the rally. With the market on edge, traders should be prepared for a volatile session.

What to Watch Today

• The Venezuela Fallout: This is the dominant market narrative. The situation is extremely fluid. Any signs of a prolonged U.S. involvement, disruptions to oil supply, or a spillover into other regional conflicts would be a major “risk-off” catalyst. 
• The January Effect and Seasonal Tailwinds: The market has now entered what is historically a very strong period for stocks. With the S&P 500 rising 62% of the time in January, and even more so when the month starts strong, seasonal tailwinds are a major factor. 
• Japan’s Bond Market Crisis: The surge in JGB yields to multi-decade highs is a major structural shift for global markets. This is a story that will have far-reaching implications for the Yen, global carry trades, and risk assets. 
• The CES Tech Catalyst: The Consumer Electronics Show (CES) is a major event for the tech sector. Keynote speeches from the CEOs of Nvidia and AMD will be heavily scrutinized for any new announcements on AI, robotics, and the future of computing.