Stay up to date with the latest market trends, economic shifts and key financial developments across the UK, US, and Asia – giving you clear insights to support client conversations.
This week's headlines:
- Federal Reserve holds rates steady – the US central bank left rates unchanged at 3.50-3.75% at its January meeting, given the strength of the US economy and that inflation is still above target at 2.70%. Markets still expect one more rate cut this year.
- Mag 7 earnings paint a mixed picture – earnings from the so‑called Mag 7 tech giants delivered a split reception. While Apple, Meta, and Microsoft all delivered strong earnings, the share price reaction was mixed. Meta stocks rose 10% after earnings, but Microsoft shares fell by 10%. This reflects how much is already priced in and shifting narratives around growth expectations – especially for cloud and AI investment.
- Precious metals steal the spotlight – gold and silver continued to capture investor attention, reaching fresh record highs again this week as safe‑haven flows gained momentum. Prices in both did fall later in the week, however, due to profit taking.
- Oil prices rise on geopolitical risk – crude oil prices climbed over the week, as tensions between Iran and the US led to fears over supply. In addition to other recent developments such as in Venezuela and tighter US restrictions on Russian oil, this has led to oil’s strongest month since 2023.
- Crypto continues to struggle – while many markets have been strong so far this year, the crypto market has continued to be weak. This is likely due to wider geopolitical risks and uncertainty in the markets, with crypto generally a volatile asset in these environments.
What this means for financial advisers and clients
It’s been a volatile week for investors, as a mix of geopolitical risks, central bank decisions, and tech earnings led to mixed returns.
The contrast between Microsoft and Meta highlights a growing sensitivity among investors to how AI investments are translating into revenue. While both companies boosted their AI spending, Microsoft’s larger than expected outlay, combined with a slight decrease in cloud revenues, triggered its largest decline since 2020.
This continues a trend we’ve noted over the past year: diverging performance across the Mag 7 tech giants. In such an environment, it reinforces the value of focusing on fundamentals, and could be an environment where active management can have an advantage over passive investing.
Chart of the week - central banks turning to gold
Source: Sarasin & Partners, Macrobond
Why this matters
The above chart highlights a clear trend since 2020: central banks have steadily increased their ownership of gold, while foreign ownership of US Treasuries has been declining.
Given continued geopolitical tensions, and concerns over potential increases in inflation, investors have been flocking to the precious metal over recent years. Traditionally, the US dollar and Treasuries were also favoured during times of uncertainty, but less so recently due to concerns over the debasement of the US dollar and a general move away from investing in US assets, as the US administration has become more unpredictable.
While the US markets are still the largest and most liquid in the world, this does reflect a move by investors to diversify their holdings into other asset classes.
The Markets
UK shows strength
The FTSE 100 was positive over the week, led by the mining, oil, and banking sectors. 3i performed well on the strong performance of its holding in retailer Action, while the oil majors BP and Shell benefited from rising crude prices. The FTSE 250 was slightly down over the week, but has performed well YtD.
US sees a volatile week
In the US, returns were mixed. Banking and energy stocks did well, similar to the UK, but overall, both the S&P and Nasdaq finished the week marginally lower. Software, particularly Microsoft, struggled, highlighting the ongoing sensitivity of tech investors to AI spending and revenue growth.
Emerging Markets deliver
Emerging Markets continued their strong performance, with South Korea and Taiwan benefiting from tech and AI exposure. Strong earnings from companies like SK Hynix, combined with a solid run for mining stocks, helped these markets outperform.
Bonds remain flat
Government bonds, including UK Gilts and US Treasuries, were largely rangebound over the week. The Fed held rates steady and UK RPI inflation came in higher than expected, cooling expectations for further rate cuts in the coming months.
Oil and gold continue to rise
Gold and silver hit record highs during the week, as investors continue to favour the safety of precious metals with ongoing geopolitical uncertainty. Oil also had a strong week due to US-Iran tensions potentially disrupting supply.
| | Weekly Change | YtD Change |
|---|---|---|
| FTSE 100 | 0.28% | 2.46% |
| FTSE 250 | -0.13% | 3.75% |
| S&P 500 | -0.69% | -0.47% |
| NASDAQ | -0.38% | 0.21% |
| FTSE Developed Europe Ex-UK | -0.35% | 1.60% |
| FTSE Emerging Markets | 1.05% | 5.12% |
| FTSE Japan | -0.34% | 4.28% |
| Brent Crude | 2.40% | 8.38% |
| Gold Spot | 7.35% | 22.12% |
| UK 10yr Gilt yield | -2bp | +3bps |
| US 10yr Treasury yield | -1bps | +7bps |
Source: FE FundInfo, goldprice.org, exchangerates.org.uk, investing.com and finance.yahoo.com. GBP returns as at close of business on Thursday 29th January 2026.
2026 Let's Talk Markets webinars
The next Let's Talk Markets webinar takes place on Thursday, 5th March 2026, continuing our series of insights for the year ahead.
Our team is already shaping a programme based on what you’ve told us you value most: sharper market insight, practical takeaways, and topics timed to be most relevant for you.
A quick housekeeping note: you’ll need to register again. Each year’s series is brand new, and previous sign-ups don’t carry over.
This article is for financial professionals only. Any information contained within is of a general nature and should not be construed as a form of personal recommendation or financial advice. Nor is the information to be considered an offer or solicitation to deal in any financial instrument or to engage in any investment service or activity. Parmenion accepts no duty of care or liability for loss arising from any person acting, or refraining from acting, as a result of any information contained within this article. All investment carries risk. The value of investments, and the income from them, can go down as well as up and investors may get back less than they put in. Past performance is not a reliable indicator of future returns.
