The dollar was heading on Thursday toward its strongest position against major rivals in the past month, helped by support from investors this week that boiled down to more than just one simple catalyst. ...

Core Insights - Wall Street has shown moderate performance in early 2026, with the S&P 500 gaining 1.1%, Dow Jones up 3.6%, and Nasdaq Composite down 0.9%, while small-cap index Russell 2000 has surged 6.5% and State Street SPDR Portfolio S&P 600 Small Cap ETF SPSM has increased by 8.7% [1] Market Performance - The small-cap stocks are outperforming larger peers, indicating a shift in investor preference towards domestic-focused companies amid macroeconomic uncertainties [10] Macro Environment - Key factors influencing market performance include heightened geopolitical tensions, a rebound in the U.S. dollar, fluctuations in precious metals, and the impact of winter storm Fern on natural gas prices [2] Geopolitical Tensions - Increased geopolitical concerns arose from U.S. actions against Venezuela and potential actions regarding Iran, which have contributed to market unease [3][5] U.S. Dollar Dynamics - The U.S. dollar strengthened following the nomination of Kevin Warsh, viewed as a hawkish central banker, benefiting small-cap stocks due to their lower foreign exposure [6] Earnings Outlook - U.S. small-cap earnings are expected to rebound, with the S&P 600 index projected to achieve 12.7% positive earnings growth in 2025, followed by steady growth of 10.7% and 14.7% in 2026 and 2027, respectively [7] Valuation Metrics - The Russell 2000 trades at a trailing P/E of 36.56X and a forward P/E of 23.25X, indicating potential undervaluation compared to the Nasdaq 100's forward P/E of 24.69 [8] Small-Cap ETFs Performance - Notable small-cap ETFs include Invesco S&P SmallCap 600 Revenue ETF (RWJ) up 11.6%, Pacer US Small Cap Cash Cows Growth Leaders ETF (CAFG) up 9.4%, and others showing strong momentum [11]

Core Viewpoint - The cryptocurrency market experienced significant declines, particularly Bitcoin, Ethereum, and Solana, following President Trump's announcement of Kevin Warsh as his choice for the next Federal Reserve chairman, which strengthened the U.S. dollar and raised concerns about the appeal of cryptocurrencies as alternative currencies [1][2]. Group 1: Cryptocurrency Market Performance - Bitcoin fell below $78,000, down 7.6% [1] - Ethereum decreased by approximately 11% to $2,382.57 [1] - Solana dropped 13% to $101.91 [1] Group 2: Federal Reserve Leadership Impact - Trump's selection of Kevin Warsh to lead the Fed is expected to bolster the U.S. dollar, potentially diminishing Bitcoin's attractiveness as an alternative currency [2] - If confirmed, Warsh would replace Jerome Powell, whose term ends in May [3] - Trump's criticism of Powell has been ongoing since 2018, particularly regarding interest rate policies [3] Group 3: Broader Market Context - The decline in cryptocurrencies follows a sharp selloff in spot silver, marking the worst day for the market since March 1980, with spot silver down 28% at $83.45 an ounce [3][4] - Silver futures fell 31.4% to settle at $78.53 [4]

Core Viewpoint - Emerging markets have significantly outperformed U.S. stocks over the past year, with the iShares MSCI Emerging Markets ETF returning over 39% compared to the SPDR S&P 500 ETF Trust's 17% [1] Group 1: Performance Comparison - The iShares MSCI Emerging Markets ETF has returned more than 39% in the last 12 months [1] - The SPDR S&P 500 ETF Trust has only returned 17% in the same period [1] Group 2: Factors Influencing Performance - Factors such as fading U.S. dollar strength and overseas earnings momentum are contributing to the strong performance of emerging markets [1] - Ted Neild, CEO and chief investment officer at Gresham Partners, believes the current setup for emerging markets relative to developed markets is more favorable than in the past decade [1] Group 3: Institutional Insight - Gresham Partners is a wealth management firm with $13.2 billion in assets, serving 125 wealthy families [1]

Core Viewpoint - Oil prices experienced a decline on Wednesday, driven by a broader selloff in global financial markets, raising concerns about economic growth and fuel demand [1] Group 1: Market Dynamics - The drop in oil prices is attributed to a stronger U.S. dollar, which typically inversely affects commodity prices [1] - Reports indicate rising U.S. oil production, contributing to the oversupply in the market [1] Group 2: Economic Implications - The overall selloff in financial markets reflects growing apprehensions regarding economic growth prospects, which could further impact fuel demand [1]

Travel Opportunities - Some countries offer unbeatable value due to the strong U.S dollar [1] - Money goes the extra mile for hotels, meals, and unforgettable adventures in certain countries [1]

Core Insights - The U.S. dollar is experiencing a rally, reaching a two-month high due to fiscal and economic concerns affecting major currencies in the Group of 10 [1] - Hedge funds are increasing bearish bets on the euro and yen, contributing to stronger demand for long-dollar positions [1] - The U.S. economy shows signs of recovery with a projected growth rate of 0.6% in Q3 and 0.7% in Q4 of 2025, following a contraction in Q1 [5] Currency Performance - The Invesco DB US Dollar Index Bullish Fund (UUP) has lost 3.2% over the past year but gained 1.7% in the last month, while the WisdomTree Bloomberg US Dollar Bullish Fund (USDU) added 1.2% gains over the same period [2] - The New Zealand dollar has fallen to a six-month low after a larger-than-expected rate cut by the Reserve Bank of New Zealand, providing additional support for the U.S. dollar [4] Economic Context - The U.S. economy contracted at an annualized rate of 0.5% in Q1 2025 but rebounded with a 3.8% growth in Q2, marking the strongest performance since Q3 2023 [5] - The Federal Reserve enacted its first rate cut of the year in September, with expectations for further cuts to support the labor market and stimulate economic expansion [6] Trade and Political Factors - Easing trade tensions, particularly following agreements with several countries, have stabilized the U.S. dollar after significant declines in April 2025 due to trade issues [7] - Political shifts, such as the potential changes in Japan and the resignation of the French Prime Minister, have also contributed to the dollar's strength against key currencies [3]