Stocks Edge Higher as Traders Brace for Data Flood: Markets Wrap

(Bloomberg) — A rally that drove the S&P 500 to within a whisker of an all-time high added modest gains as traders gear up for a slate of US economic readings, starting with retail sales on Tuesday.

Futures for the US benchmark rose 0.1% after a 2.5% advance over the past two sessions. Gold kept above $5,000 an ounce. Upbeat corporate reports lifted single stocks, including gains of 5% or more for Ferrari NV and Spotify Technology SA. Alphabet Inc. is selling at least $9.4 billion in sterling and Swiss franc-denominated debt following a bumper US deal.

Economists and analysts expect solid retail sales for December, supported by resilient household spending despite high living costs and a fragile employment backdrop. The release will be followed by payrolls and inflation data in the coming days, as well as a slate of secondary readings on the labor market.

Markets are experiencing a moment of calm after an artificial-intelligence-driven selloff and subsequent rebound over the past week. Traders are now waiting to see how this week’s data may shape expectations for the Federal Reserve’s interest-rate path.

“What’s at stake with this week’s US data is to know whether we can move from a K- to a V-shaped rebound,” said Kevin Thozet, an investment committee member at Carmignac. “There are signs that the US consumer’s morale is improving, but we’re not there yet. It’s clearly the objective of the Trump administration ahead of the midterms.”

Treasuries gained, with the 10-year yield falling three basis points to 4.18%. The dollar was little changed after back-to-back declines.

Money markets continue to price in two Fed rate cuts for 2026, with the first seen under the likely leadership of Kevin Warsh after Jerome Powell steps down as chair in May. Traders have been debating whether Warsh would represent a more hawkish choice for the top role than other candidates President Donald Trump considered.

Trevor Greetham, head of multi-asset investing at Royal London Asset Management, said stocks are probably being driven more by interest-rate expectations than corporate results at the moment.

“You can see that by the performance of the technology sector and what’s going on with US Treasury yields,” Greetham said. “Recently, when you’ve had rising bonds, you’ve had tech underperformance, which tells you more about the interest-rate part of the calculation.”

More than 300 members of the S&P 500 have published earnings so far this season, of which 79% have outperformed expectations.

UK borrowing costs dipped after Keir Starmer shored up his position as prime minister and the risk of leadership change faded. Longer-dated bonds gained the most, with the 30-year yield falling three basis points to 5.32% after a sharp rise on Monday. The pound fell 0.2%.

The Nikkei 225 extended its record high on growing optimism that increased fiscal spending under Japanese Prime Minister Sanae Takaichi will boost earnings. The yield on 30-year Japanese bonds dropped six basis points to 3.47%.

In China, the yuan surged to its strongest level since May 2023 after regulators asked banks to limit their holdings of US Treasuries. The news reinforced a broader trend of diversification away from the dollar, potentially accelerating the repatriation of capital into Chinese assets.

Corporate Highlights:

BP Plc is halting share buybacks to shore up its balance sheet as pressure mounts on the UK energy giant to deliver on its turnaround. The shares sank more than 4% in London. Spotify Technology SA, the Swedish music streaming giant, signed up significantly more users than analysts expected, setting a corporate record for most users added in a single quarter. Barclays Plc said it will return at least £15 billion ($20.5 billion) to shareholders through 2028 as it continues to work through a long-term plan to slash costs and improve profitability. Taiwan Semiconductor Manufacturing Co.’s January sales grew at their fastest clip in months, a sign of sustained global AI spending even as concerns persist about an industry bubble. Gucci sales fell in the final months of last year as Kering SA struggles to revive its biggest brand. Some of the main moves in markets:

Stocks

The Stoxx Europe 600 rose 0.1% as of 12:19 p.m. London time S&P 500 futures rose 0.1% Nasdaq 100 futures rose 0.2% Futures on the Dow Jones Industrial Average were little changed The MSCI Asia Pacific Index rose 1.2% The MSCI Emerging Markets Index rose 0.7% Currencies

The Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1907 The Japanese yen rose 0.4% to 155.22 per dollar The offshore yuan was little changed at 6.9110 per dollar The British pound fell 0.1% to $1.3676 Cryptocurrencies

Bitcoin fell 2.6% to $68,567.38 Ether fell 5.1% to $2,012.84 Bonds

The yield on 10-year Treasuries declined three basis points to 4.18% Germany’s 10-year yield declined two basis points to 2.83% Britain’s 10-year yield declined two basis points to 4.51% Commodities

Brent crude rose 0.4% to $69.33 a barrel Spot gold fell 0.1% to $5,050.93 an ounce This story was produced with the assistance of Bloomberg Automation.

–With assistance from Sabrina Nelson Garcinuño and Neil Campling.

©2026 Bloomberg L.P.