investingLive European news wrap: Markets on edge ahead of Trump’s Davos speech

Headlines:

• Heads up: US president Trump due to speak in Davos later today
• US stocks extend losses as traders stay on the defensive ahead of Trump’s speech in Davos
• US futures pare slight gains awaiting Trump address in Davos
• Bessent says not concerned at all about any Treasuries selloff over Greenland
• ECB’s President Lagarde: The curtain is coming up on new world order
• Japanese bond yields come off the boil for the time being
• UK December CPI +3.4% vs +3.3% y/y expected
• UK industrial orders fall once again to start the new year
• Japan’s Rengo says the environment for wage talks this year is not so bad

Markets:

• AUD and NZD lead, USD lags on the day
• European equities lower; S&P 500 futures down 0.2%
• US 10-year yields down 1.4 bps to 4.280%
• Gold up 2.0% to $4,856.67
• WTI crude oil up 0.1% to $60.41
• Bitcoin down 1.0% to $88,526

We’re almost there.

Trump’s much anticipated special address at the World Economic Forum (WEF) in Davos is upon us. And that’s the main event that markets are waiting for today.

There was a bit of a hiccup earlier in the day when Air Force One had a “minor electrical issue” but Trump is scheduled to make it in time for his address at 1330 GMT in just a bit.

The waiting is keeping markets in a nervy mood, with some anxiousness creeping in during the past hour or so. Equities were slightly calmer earlier on in the session but are stepping lower now with US futures turning negative ahead of Trump’s address.

The mood isn’t helped by a reported qualms during a private meet in Davos where US commerce secretary Lutnick spoke. He was said to have lambasted European officials and the bloc in general, to the point where ECB president Lagarde couldn’t stand it and walked out mid-speech. So, there’s that to set the mood before Trump speaks later.

In the FX space, the dollar was steadier early on but is now starting to slip back lower again as the nerves circle back around. EUR/USD is up 0.1% to 1.1735 with the earlier low touching near 1.1700. Meanwhile, USD/JPY is down 0.2% to 157.77 as Japanese bonds find a bit of a respite after the intense rout in the early stages this week.

In the commodities space, gold continues to shine brightly as it pushes gains of roughly 2% and claiming fresh record highs once more as the rally today crosses over and above $4,800. Hot, hot, hot. 🔥

It’s all now on Trump’s address first and foremost before some bilateral meetings with European leaders. It is reported that he will at least have five sit downs with European officials in his time at Davos. So, let’s see if he will drop any TACO shells on the floor this week.

This article was written by Justin Low at investinglive.com.