Market Updates

Markets face a pivotal week with US inflation data, economic updates, and earnings reports from major banks, alongside global events including Eurozone and UK inflation figures, China’s GDP, and central bank insights, as strong US data fuels yield surges and inflation risks dominate policy discussions.

The 2025 outlook emphasizes economic transformation over traditional cycles, offering opportunities to counter market misinterpretations of macro data while navigating surprises, volatility, and policy-driven shifts.

The first full week of the year features key economic data releases, including the FOMC minutes, US employment report, global PMI and inflation readings, alongside central bank commentary, with markets focused on inflation control, labour market resilience, and evolving monetary policies from the Fed, ECB, BoE, and PBoC.

BlackRock believes economic transformations require scenario-driven portfolio strategies, as government bonds are less reliable diversifiers, prompting investors to consider alternatives like gold and bitcoin for distinct risk and return drivers.

This week’s focus will be on key central bank decisions from the FOMC, BoJ, and BoE, along with EU leadership talks, while markets digest US inflation data, China’s mixed economic signals, and the ECB’s recent policy shift toward potential easing.

This year highlights the transformative impact of mega forces like AI on economies, prompting a dynamic, theme-focused investment approach as BlackRock maintain a risk-on stance for 2025, increasing their U.S. equity overweight while remaining ready to adjust risk.

Key events this week include the ECB meeting, US CPI and PPI data, and China’s Central Economic Work Conference, while last week’s markets responded to mixed US labor data, geopolitical tensions, and China’s economic support measures, setting the stage for critical monetary policy signals ahead of the December FOMC meeting.

Strong corporate earnings have driven U.S. and Japanese equity overweights, with fundamentals taking precedence over valuations, while European opportunities remain selective due to weaker earnings growth, highlighting AI-driven U.S. potential and targeted gains in sectors like European financials.

This week’s focus includes the pivotal US jobs report (Friday) ahead of the final FOMC meeting, key economic data releases across regions, central bank discussions, and market impacts from Trump’s tariff announcements and economic developments in China, signaling mixed global economic sentiment.

Nvidia’s Q3 earnings highlight the rapid AI data center buildout, reflecting the transformative potential of AI, while an active investment approach helps navigate uncertainties and seize opportunities across its buildout, adoption, and transformation phases.