Markets open Friday digesting a mixed session on Thursday that brought a combination of soft economic data, earnings momentum, and a bizarre Powell-Trump press moment that added a touch of political theater to an otherwise macro-light week.
Thursday’s session was packed on paper — with PMIs from major economies, an ECB decision, and earnings from names like Intel, Blackstone, and Honeywell — but markets largely shrugged. PMIs painted a familiar picture: Eurozone steady, UK services slowing, and U.S. data mixed, with manufacturing missing and services surprising to the upside at 55.2. The ECB held rates at 2.15%, as expected, and Lagarde’s press conference triggered no real euro volatility.
One wild card was the Powell-Trump appearance, which felt more like parody than policy. While there was no direct move on Powell’s status, Trump’s comments about wishing for lower rates underscored the ongoing political pressure on the Fed. The market reaction? Brief confusion, followed by a return to normal programming.
By the close Thursday, indices lost ground, with the DAX leading declines. U.S. indices also pulled back, but not by much — in fact, futures overnight set new all-time highs before retreating slightly into the European open.
Friday morning brings more selling on European indices, led again by the DAX, which is underperforming. U.S. futures are off their highs but still elevated overall, keeping the long-term bullish trend intact.
On the FX front, the euro is the clear winner, strengthening sharply across the board. The British pound, however, is under pressure after UK retail sales missed expectations at 0.9% vs. 1.2%. Japanese yen is softening after recent gains, and could end the week flat or slightly negative if current risk sentiment holds.
In commodities, gold remains heavy, pressured by a technical rejection from key resistance midweek. Oil is stable but still coiling for a bigger directional move — downside risk is growing. Copper and silver are holding onto gains, while platinum and palladium continue to lag.
The macro calendar today is light, with only U.S. durable goods orders ahead — expected at a sharply negative -10.4% — and no major earnings reports on deck. After a choppy Thursday, markets now enter the final trading day of the week with momentum on edge and volatility lurking beneath the surface.