(Bloomberg) -- Gold pared dramatic losses as US President Donald Trump postponed military strikes against Iranian energy infrastructure for a five-day period after what he described as productive talks toward ending hostilities. Spot gold briefly traded higher before slipping about 2% as Iran denied the discussions. Silver rebounded, erasing losses of more than 10%. US stocks rose while Treasury yields and the dollar retreated. Traders reduced bets on Federal Reserve tightening, pricing in some easing. ...

Core Viewpoint - The content emphasizes the importance of conducting personal due diligence and consulting with competent advisors before making any financial decisions, particularly in the context of investments in complex instruments like cryptocurrencies and CFDs [1]. Group 1 - The website provides general news, personal analysis, and third-party materials intended for educational and research purposes [1]. - It explicitly states that the information should not be interpreted as a recommendation or advice for investment actions [1]. - The accuracy and reliability of the information are not guaranteed, and users are cautioned against relying solely on the content provided [1]. Group 2 - The website discusses the high risks associated with cryptocurrencies and CFDs, highlighting their complexity and the potential for significant financial loss [1]. - It encourages users to conduct their own research and fully understand the instruments and risks involved before making investment decisions [1].

The dollar index (DXY00) today is up by +0.39%.  The dollar is climbing today as soaring crude prices are boosting T-note yields, strengthening the dollar's interest rate differentials. Also, today's US economic reports, which showed a smaller-than-expected increase in weekly jobless claims and a larger-than-expected increase in Q4 nonfarm productivity, are supportive of the dollar.  Gains in the dollar accelerated today on hawkish comments from Richmond Fed President Tom Barkin, who said he expects "a cou ...

OPEN HIGHER. LET'S DIG INTO THE RECENT ACTION THAT WE'VE SEEN ACROSS DIFFERENT ASSET CLASSES. FRANK CAPILLARY, FOUNDER AND PRESIDENT OF CAP THESIS, ALSO A CNBC CONTRIBUTOR HERE ON SET IN FRONT OF THE TELESTRATOR.AND YOU ARE ARMED WITH CHARTS WHICH I LOVE AND I THINK WE GOT I THINK WE GOT TO START CLASSIC HERE AND GO WITH ESP AND WHAT WE HAVE SEEN, WE JUST TALKED ABOUT WITH RYAN DIETRICH, THE FACT, THE FACT THAT OVER THE LAST THREE MONTHS WE'VE BASICALLY BEEN RANGE BOUND. BUT WHAT ARE YOU WATCHING. >> WELL, ...

Core Viewpoint - The recent geopolitical tensions, particularly the conflict involving the US, Israel, and Iran, have raised questions about the landscape for global investing, especially in emerging markets [3][4][5]. Geopolitical Impact - The Middle East represents only about 5% of emerging markets, and while there may be short-term tactical changes due to higher oil prices, the long-term outlook suggests a weaker dollar and stronger emerging market equities [4][5]. - If the conflict persists, it could lead to higher oil prices, inflation, and interest rates in the US, potentially strengthening the dollar, which would be a headwind for emerging markets [7]. Investor Sentiment - Despite heightened geopolitical risks, investor sentiment appears resilient, with many investors accustomed to geopolitical noise and maintaining a risk-on approach [10][11]. - A survey indicated that over 75% of advisors still favor equity risk for investments in 2026, suggesting a strong appetite for risk [13]. Emerging Market Strategies - Emerging markets are seeing a shift towards more discerning investment strategies, with a focus on smaller pockets and active strategies to mitigate concentration risk, particularly in Asia [17][18]. - Countries like Argentina, Brazil, and Colombia are highlighted for their value opportunities, with low price-to-earnings multiples and exposure to commodities [19][23]. Political and Economic Factors - Political reforms in Latin America, such as those in Argentina and Brazil, are expected to drive fiscal reform and reduce risk premiums, attracting more investment [22]. - Brazil's high real interest rates and favorable inflation rates create a stable environment for investment, particularly in financials [23][42]. ETF Market Trends - International equities, especially emerging markets, have seen significant inflows, with over 40% of ETF flows directed towards international ETFs, marking a trend not seen in many years [30]. - The popularity of actively managed ETFs is increasing as investors seek targeted exposure to specific countries and sectors within emerging markets [35][38]. Sector Focus - The focus is shifting towards value and cyclicals, particularly in commodities like copper, energy, and gold, with financials expected to benefit from improving asset quality as interest rates decline [42]. - The technology sector, particularly in Asia, remains attractive due to strong tailwinds from the AI ecosystem, but there is a cautious approach towards momentum trades [26][41].

Core Viewpoint - The content emphasizes the importance of conducting personal due diligence and consulting with competent advisors before making any financial decisions, particularly in the context of investments in complex instruments like cryptocurrencies and CFDs [1]. Group 1 - The website provides general news, personal analysis, and third-party materials intended for educational and research purposes [1]. - It explicitly states that the information should not be interpreted as a recommendation or advice for investment actions [1]. - The accuracy and reliability of the information are not guaranteed, and users are cautioned against relying solely on the content provided [1]. Group 2 - The website includes information about cryptocurrencies, CFDs, and other financial instruments, highlighting their complexity and associated high risks [1]. - Users are encouraged to conduct their own research and fully understand the workings and risks of any financial instruments before investing [1].

Group 1: Dollar Index and Economic Indicators - The dollar index (DXY00) reached a 1-week high, increasing by +0.25%, driven by rising T-note yields and a drop in weekly US unemployment claims to a 1-month low of 199,000, which was a decrease of -16,000 from previous figures [1][3] - The markets are currently pricing in a 15% probability of a -25 basis point rate cut at the upcoming FOMC meeting scheduled for January 27-28 [3] Group 2: Federal Reserve and Monetary Policy - Questions regarding the independence of the Federal Reserve are limiting the dollar's gains, particularly after President Trump suggested he might consider firing Fed Chair Powell [2] - The Federal Reserve is expected to cut interest rates by approximately -50 basis points in 2026, while other central banks like the Bank of Japan (BOJ) are anticipated to raise rates by +25 basis points in the same year [4] - The Fed's liquidity measures, including the purchase of $40 billion in T-bills monthly since mid-December, are exerting additional pressure on the dollar [5] Group 3: Euro and Market Sentiment - The EUR/USD pair fell to a 1-week low, decreasing by -0.21%, as the dollar's strength negatively impacted the euro, compounded by ongoing concerns regarding the Russian-Ukrainian war [6] - Market activity in the euro is subdued due to the New Year's holiday in Germany, with swaps indicating only a 1% chance of a +25 basis point rate hike by the European Central Bank (ECB) at its next meeting on February 5 [6]

Group 1: Sugar Price Trends - March NY world sugar 11 closed down -0.42 (-2.75%) and March London ICE white sugar 5 closed down -8.60 (-1.98%) on Tuesday, indicating a decline in sugar prices to 1-week lows due to a rally in the dollar index [1] - Earlier in the month, sugar prices were pressured by expectations of higher sugar exports from India, as the government may permit additional exports to alleviate a domestic supply glut [3] - The outlook for record sugar output in Brazil is bearish for prices, with Conab raising its 2025/26 sugar production estimate to 45 million metric tons (MMT) from 44.5 MMT [5] Group 2: Production Estimates - Brazil's sugar production in 2026/27 is expected to fall by -3.91% to 41.8 MMT from 43.5 MMT in 2025/26, with exports anticipated to decline by -11% year-on-year to 30 MMT [2] - The India Sugar Mill Association (ISMA) raised its 2025/26 sugar production estimate to 31 MMT, an increase of +18.8% year-on-year, while also cutting the estimate for sugar used for ethanol production [4] - Brazil's cumulative 2025-26 Center-South sugar output through November rose by +1.1% year-on-year to 39.904 MMT, with the ratio of cane crushed for sugar increasing to 51.12% in 2025/26 from 48.34% in 2024/25 [5]

Currency Market Overview - The dollar index (DXY00) is down slightly by -0.03%, reversing an early advance due to a decline in the Dallas Fed manufacturing outlook [1] - The dollar initially gained strength from stock market weakness, which increased liquidity demand, but later weakened after disappointing manufacturing data [1] Economic Indicators - US November pending home sales rose by +3.3% month-over-month, surpassing expectations of +0.9% [5] - The Dallas Fed manufacturing outlook for December unexpectedly fell by -0.5 to -10.9, against expectations of an increase to -6.0 [5] Federal Reserve and Interest Rates - Markets are pricing in a 19% chance of a -25 basis point rate cut at the FOMC's next meeting on January 27-28 [2] - The Federal Reserve is expected to cut interest rates by about -50 basis points in 2026, contributing to the dollar's underlying weakness [3] Global Central Bank Actions - The Bank of Japan (BOJ) is expected to raise rates by +25 basis points in 2026, while the European Central Bank (ECB) is anticipated to keep rates unchanged [3] - Swaps indicate a 0% chance of a +25 basis point rate hike by the ECB at the next policy meeting on February 5 [7] Market Sentiment and Future Outlook - Concerns regarding President Trump's potential appointment of a dovish Fed Chair are putting additional pressure on the dollar, with Kevin Hassett seen as the most likely candidate [4] - The Fed's recent actions to boost liquidity, including purchasing $40 billion a month in T-bills, are also contributing to the dollar's weakness [4]

Core Viewpoint - The Avantis Emerging Markets Equity ETF (AVEM) achieved a 35% return in 2025, significantly outperforming major Vanguard funds, indicating a potential resurgence for emerging markets [1][2]. Group 1: Performance and Assets - AVEM holds $15.1 billion in assets and has a concentrated investment in Asian technology and financial sectors, particularly with 6.35% allocated to Taiwan Semiconductor [1][2]. - The fund outperformed the Vanguard S&P 500 ETF (VOO) and Vanguard Total Stock Market ETF (VTI) by approximately 17 percentage points in 2025 [1][2]. Group 2: Macro Factors - A key macroeconomic factor for AVEM in 2026 is the strength of the U.S. dollar; a 9% decline in the dollar during 2025 enhanced the attractiveness of emerging market assets [4]. - Continued dollar weakness is expected to provide tailwinds for AVEM, while monitoring the Federal Reserve's rate decisions and global growth expectations is crucial [5]. Group 3: China’s Economic Influence - AVEM's performance is heavily influenced by China's economic policies, with significant investments in Chinese tech giants and banks; supportive government measures in 2025 contributed to the fund's gains [6]. - If China's support for the private sector continues or accelerates in 2026, AVEM stands to benefit, but tightening policies or geopolitical tensions could pose risks [6]. Group 4: Sector Concentration and Risks - The fund's largest holding is Taiwan Semiconductor, and its returns are significantly driven by semiconductor stocks, which performed well due to increased AI chip demand in 2025 [7]. - This concentration in semiconductors creates vulnerability; any downturn in the semiconductor cycle or supply chain disruptions could adversely affect AVEM [7].