Financial Markets Daily Report
16 January 2026
Risk sentiment improved during yesterday’s session. US Treasury yields edged higher after weekly unemployment benefit claims declined, reinforcing expectations that the Fed will keep interest rates on hold in January. Equities advanced, supported by renewed optimism around artificial intelligence following strong results from Taiwanese semiconductors.
On the geopolitical front, President Trump signaled he may refrain from military action in Iran, easing concerns over potential oil supply disruptions after reports indicated that the crackdown on protesters was easing. Brent crude prices fell below $64 per barrel, retreating from levels near $66 per barrel reached in previous sessions.
In Asia, the Japanese equity rally paused, with the Nikkei declining 0.5%, while the yen remained broadly stable against the US dollar. China’s central bank announced a 25bp rate cut in an effort to provide additional support to the economy.
Portuguese yields moved higher due to a change in the generic bond benchmark, rather than underlying market conditions.