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U.S. bond funds had $3.8 billion of total inflows during the five-day period that ended on Jan. 2, bouncing back from mid-December’s sharp outflows, according to a team at Barclays.
Bond-fund demand nonetheless remained soft compared with the strong demand seen over 2024, the Barclays team said in a note on Monday. “The soft demand came amid year-end trading conditions and likely contributed to the sell-off in rates that brought the 10y yield close to the highest levels of 2024,” they wrote.
(EPFR, Barclays)
Monday’s selloff in most U.S. government debt was pushing the benchmark 10-year rate toward its highest level in about eight months as traders looked toward a week of government auctions.
Tuesday’s $39 billion 10-year auction is being regarded as this week’s most important gauge of Treasury demand. As of Monday morning, the 10-year rate was up about 2 basis points at around 4.619%, near its highest level since May 1.
Shares of FuboTV Inc. are on pace for a record one-day percentage gain, boosted by a deal to combine Walt Disney Co.’s Hulu + Live TV service with Fubo.
The stock is currently up 141.6%, putting it on pace to beat FuboTV Inc.’s previous record daily percentage gain of 44.98% set on Aug. 16, 2022, Dow Jones Market Data show.
The shares are also on track for their best four-day stretch on record, based on available data back to Oct. 13, 2020, according to Dow Jones Market Data.
President-elect Donald Trump on Monday denied a Washington Post article that said the incoming administration would take a more limited approach to tariffs than indicated during the presidential-election campaign.
Trump denied the report in a message on his Truth Social account.
“The story in the Washington Post, quoting so-called anonymous sources, which don’t exist, incorrectly states that my tariff policy will be pared back. That is wrong. The Washington Post knows it’s wrong. It’s just another example of Fake News,” he wrote.
The Washington Post, citing three people familiar with the matter, said tariffs would be applied to every country but only cover imports critical to national or economic security. The report also said no final decisions had been made.
The dollar pulled back sharply after the Washington Post report. The ICE U.S. Dollar Index, a measure of the currency against a basket of six major rivals, was down 0.6% but moved off session lows after Trump’s remarks.
Gold prices were off about 0.8% on Monday near $2,634 an ounce
Gold prices now look unlikely to hit a record $3,000 per ounce until the second quarter of 2026, according to a team of Goldman Sachs analysts led by Lina Thomas.
The team’s bullish call that the precious metal will reach the new threshold by the end of 2025 stood out — but on Sunday they revised their outlook, “primarily because our economists now expect 75bp of cuts in 2025 (vs. 100bp previously) with a slightly higher terminal rate of 3.5-3.75%.
“Structurally higher central bank demand (adding 12% to gold prices by 2026Q2)” remains a key expected driver of their forecast for 14% of “price upside” by the second quarter of 2026, as well as demand from exchange-traded funds as the Federal Reserve’s short-term policy rate declines.
Stocks opened higher Monday to kick off a week that will be shortened by a day of mourning Thursday for former President Jimmy Carter, who died last month. Stocks will be closed Thursday, while the bond market will see an early close.
Nvidia shares were up 2.7%, with chip stocks rallying and providing a lift. The tech-heavy Nasdaq Composite jumped 1.2%, while the S&P 500 advanced 0.8%. The Dow Jones Industrial Average lagged behind, up 0.3%.
U.S. stock funds boasted a collective yearly gain of more than 25% heading into December, according to EPFR data.
Performance at individual funds, however, was more extreme, ranging from a low of negative 98% to more than 1,600%, with “top performers dominated by leveraged single stock funds dedicated to either Nvidia or Palantir,” Cameron Brandt, director of research at EPFR, wrote in a Friday client note.
European automakers surged after the Washington Post report that Trump tariffs will be more focused.
The report suggested that the initial tariffs, which still would be imposed on all countries but not across the board, would be focused on areas of national or economic security.
Investors interpreted that to mean automakers might not get hit, despite Trump’s personal annoyance with the industry, as he even during the campaign criticized German plants in South Carolina, saying not assembly was done.
Porsche was among the European automakers to have benefited.
LVMH, the luxury-goods giant, also soared.
Vanguard FTSE Europe ETF rose 2% in premarket trade.
MicroStrategy Inc. unveiled its latest capital raise late Friday with news of plans to issue $2 billion in preferred stock to raise the funds needed to buy more bitcoin.
The business-software company and cryptocurrency play, which said it would conduct the sale in the first quarter, if at all, said it would be carried out in one or more public underwritten offerings of perpetual preferred stock.
The stock would be senior to its Class A common stock and may include features such as convertibility to Class A stock, pay dividends and all for redemptions of shares, among others, the company said in a statement.
Bitcoin was up 1%.
U.S. stock-index futures added to gains and the dollar fell sharply after the Washington Post said President-elect Donald Trump’s aides are exploring tariff plans that would be applied to every country but would only cover critical imports.
Markets had feared that Trump would follow through with previous pledges of wholesale tariffs of up to 20% on the imports from most countries, and 60% on those from China.
Traders took the apparent scaling back of tariff plans to mean a global trade war may be less likely and thus less damaging to the world economy.
The dollar, which has been seen as a beneficiary of Trump tariffs, partly because it may increase U.S. inflation and thus keep interest rates higher for longer, fell swiftly on the news, shedding 1% versus the British pound and losing 1.1% against the euro. The Mexican peso, which has been particularly badly hit of late on tariff fears, also rose 1%.
The prospect of less chance of a trade war boosted stocks, too. Germany’s DAX index, which contains many of Europe’s biggest car manufacturers – a favorite target of Trump – jumped 1.2%, while the CAC 40 in France surged 1.8%.
The S&P 500 future added to gains, trading up 0.7% as the chances of less inflationary pressures helped turn benchmark Treasury yields lower.
