From Records to Reality: S&P 500 Retreats as Metals and CAD Come Under Pressure
08 January 2026
Hello traders, welcome to Thursday. Yesterday was a very busy session, and markets are now digesting a large batch of macro data and political headlines. We started Wednesday with lower-than-expected inflation from Australia, followed by softer inflation from the eurozone. Later, ADP non-farm employment change from the US disappointed, while Canada’s Ivey PMI came in much stronger than expected. On top of that, US ISM services PMI surprised to the upside, but JOLTS job openings were weak. Altogether, the data sent mixed signals: inflation pressures continue to ease, but cracks are appearing in the US labor market, even as parts of the services sector remain resilient. Today’s calendar is lighter, with Swiss inflation and US unemployment claims as the main scheduled releases.
From a market perspective, yesterday’s session was dominated by a failed breakout on US indices. The S&P 500 managed to print new intraday all-time highs but could not hold above them and reversed lower into the close. This type of price action often signals exhaustion, and futures are currently under pressure, pointing to a continuation of a short-term correction rather than a trend reversal. Given the strong rally that preceded this move, a pullback at these levels is technically healthy and not yet a reason to turn structurally bearish on equities.
Commodities are showing much clearer weakness. Precious metals are under notable pressure, with gold extending its decline and now threatening to make new weekly lows. Silver is falling even faster, confirming that the correction across metals is accelerating rather than stabilizing. This shift suggests profit-taking after an exceptionally strong run, and for now momentum clearly favors the sellers. Oil remains volatile but secondary to the metal story at the moment.
On the currency market, antipodean currencies are struggling, while the Japanese yen is gaining ground, reflecting a mild risk-off tone. The most notable move, however, is the sharp weakness in the Canadian dollar, which has become one of the weakest currencies in the major space despite yesterday’s strong domestic PMI data. This underperformance suggests that broader risk sentiment and positioning are outweighing local fundamentals. Adding to market noise, political headlines are back in focus: attention has shifted from Venezuela to renewed discussions around Greenland, while recent comments from Donald Trump have weighed on US defense stocks and companies linked to housing and real estate, after proposals to restrict Wall Street participation in the housing market. All of this keeps sentiment fragile as markets head deeper into Thursday’s session.