USA
U.S. risk appetite was pulled in two directions: resilient macro data on one side and policy/geopolitical risk plus earnings volatility on the other. On the macro front, initial jobless claims stayed very low at 200k (week ended Jan 17), reinforcing the “still-tight labor market” narrative. But markets were whipsawed by tariff/geopolitical headlines tied to Greenland and by early earnings signals—most notably Intel’s weak outlook, which hit semis and contributed to a choppy end to the week. Net-net, major indices finished a second straight week down: Dow -0.5%, S&P 500 -0.4%, Nasdaq -0.1% (week). The takeaway: “good data” helped limit drawdowns, but headline-risk and single-stock earnings shocks kept positioning cautious into the next week’s heavier earnings/Fed catalyst set.
Europe
European risk assets largely traded as a function of “trade/tariff uncertainty + soft growth pulse.” The HCOB flash PMIs painted a mixed picture: the Eurozone composite held at 51.5 (still expansion) but undershot expectations as services cooled, new orders slowed, exports weakened, and hiring momentum deteriorated; importantly, price pressures re-emerged, complicating the disinflation narrative. Under the surface, dispersion was big—Germany showed faster activity growth (composite 52.5) but with notably weaker employment dynamics, while France slipped back into contraction (composite 48.6) as services demand softened. Overlay that with the Greenland/tariff shock, and the region de-risked: STOXX Europe 600 fell ~1.1% on the week, snapping a multi-week winning streak; the FTSE 100 was roughly flat to slightly down (-0.07%) amid a commodity/safe-haven bid. Bottom line: PMIs didn’t signal recession, but the mix of weaker forward demand + rising cost pressures + tariff risk was enough to compress multiples and favor defensives/commodities.
###Japan
Japan’s data flow was comparatively constructive on activity, but markets still respected global risk and FX-rate volatility. The standout was the S&P Global flash PMIs: manufacturing moved back into expansion (51.5) on the strongest rise in export orders in years, while services strengthened (53.4), lifting the composite to 52.8—a clean “growth improving” signal. Even so, equity performance was slightly negative over the week as global headline-risk and rates/yen sensitivity stayed in focus: from Jan 19 to Jan 23, Nikkei 225 slipped ~0.17% (53,583.6 → 53,846.9) and TOPIX fell ~0.79% (3,656.4 → 3,629.7), implying rotation and caution rather than broad capitulation. The market read-through: improving PMIs support earnings durability, but Japan remains highly exposed to global trade-policy swings and currency moves—so good domestic momentum translated into only modest index-level follow-through.
###China
China’s week was dominated by (1) the macro “level-set” from official growth data and (2) regulators leaning against speculation after a strong run. The National Bureau of Statistics reported 2025 GDP growth of 5.0% (with Q4 at 4.5% y/y), broadly consistent with a picture of steady-but-uneven momentum. At the same time, authorities moved to cool exuberance—e.g., tighter oversight and margin-rule tightening aimed at abnormal trading after heavy turnover and fast gains. In markets, mainland benchmarks were essentially range-bound: Shanghai Composite rose ~0.54% from Jan 19 to Jan 23 (4,114.0 → 4,136.2), while Hong Kong lagged modestly: Hang Seng dipped ~0.36% (26,563.9 → 26,749.5); Reuters reporting also flagged a roughly -0.5% weekly move in CSI300/Hang Seng as regulation tempered risk appetite. Bottom line: growth data reduced macro uncertainty at the margin, but policy intent to slow speculative heat capped upside—especially in high-beta themes (e.g., AI) versus more policy-aligned or cashflow sectors.