EMEA Morning Briefing : Oil Falls After Trump Cools Iran Tensions

MARKET WRAPS

Watch For:

EU foreign trade, industrial production; Germany GDP; U.K. GDP, trade, industrial production; trading updates from OMV, Richemont, Taylor Wimpey, Ashmore Group, Pepco Group

Opening Call:

European stock futures traded higher early Thursday. Asian stock benchmarks largely advanced; the dollar was little changed; Treasury yields rose; while oil futures slid and gold fell.

Equities:

Stock futures point to a higher open in Europe on Thursday. Investors' growing sense of optimism about the U.S. economy, and their more-cautious view of the artificial-intelligence build-out, have spurred a shift away from some of the recent tech highfliers and into stocks poised to benefit from a reacceleration in growth.

Meanwhile, President Trump on Wednesday said Iran had stopped killing antiregime protesters and wouldn't execute those it accused of trying to topple the government, appearing to narrow the possibility that the U.S. was about to launch military strikes against the country.

Forex:

The Norwegian krone is likely to rise against the Swiss franc, supported by the interest-rate differential and higher oil prices, Societe Generale strategists said. Short positions betting on franc falls against the krone is Europe's top G-10 carry trade where investors borrow in a low yielding currency to invest in higher yielding currencies.

Sticky inflation should keep the Norges Bank cautious on cutting interest rates, SocGen said. Renewed geopolitical tensions between the U.S. and Iran could lead to further recovery in oil prices. SocGen recommends a short position in franc-krone with a target of 11.90 krone and stop-loss of 12.85.

Bonds:

The default protection costs for European bank bonds are low amid strong appetite from investors. The robust demand likely shows that investors have a positive view on the banking sector in 2026, ABN Amro strategists said.

Energy:

Oil slid in Asia after Trump appeared to tilt away from military action in Iran. Trump said the "killing in Iran is stopping," NAB's Ken Crompton said. Trump's remarks seemed to "walk back threats against Iran, " supporting a slump in oil, he added.

Metals:

Gold declined early Thursday amid possible profit-taking after front-month Comex gold futures settled at a record high overnight. However, further price losses may be limited by geopolitical risks.

Focus could stay on developments around Iran and other areas in the region as well as potential actions from the U.S., DHF Capital's Bas Kooijman said. Also, "tensions in Eastern Europe remain unresolved, keeping geopolitical risk premia elevated," he said.

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High prices of copper are likely to be sustained throughout 1Q as long as there's uncertainty surrounding tariffs on U.S. refined copper, Goldman Sachs said. Further near-term price gains are also likely, with speculator long positions as a share of total open interest on CME not as extreme as in previous speculative peaks.

That said, GS thinks the bulk of the rally has already occurred and prices are increasingly vulnerable to a correction. GS forecasts the LME copper price to decline to $11,000 by December.

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China's iron ore imports climbed to 120 million metric tons in December, maintaining strong momentum following earlier holiday restocking, ANZ said.

The country's annual iron-ore import volume reached 1.26 billion tons, up 1.8%, which indicates continuing support from steel-mill replenishment. This is despite domestic output remaining subdued, ANZ added.

TODAY'S TOP HEADLINES

Trump Puts 25% Tariffs on Chips. It Only Matters to Nvidia and AMD-for Now.

President Donald Trump on Wednesday signed two executive orders to impose tariffs on some semiconductors and prepare for tariffs on critical minerals, if needed.

The semiconductor order codifies what Trump said in December when he implied that Nvidia would pay the U.S. 25% of H200 chip sales to China.

5 Signals From the Fed's Beige Book That Explain the Economy Right Now

The Federal Reserve's latest Beige Book delivered a somewhat brighter view of the U.S. economy, with most of the country reporting modest growth after several months of stagnation. But the most revealing insights weren't in the national summary. They were in the local details, which continue to show an economy growing unevenly and under pressure from high prices.

The Beige Book, published eight times a year, compiles anecdotal reports from businesses, banks, and community groups across the Fed's 12 districts. This month's report showed activity picking up slightly after three consecutive reports in which most districts reported little change. Fed officials described their outlooks as "mildly optimistic," with expectations for modest growth in the months ahead.

Trump Says Iran Has Stopped Killing Protesters

President Trump on Wednesday said Iran had stopped killing antiregime protesters and wouldn't execute those it accused of trying to topple the government, appearing to narrow the possibility that the U.S. was about to launch military strikes against the country.

Speaking at the White House, Trump told reporters that the U.S. had been notified Iran had "no plans to carry out any executions of protesters."

Trump Not Persuaded to Abandon Greenland Pursuit After White House Talks

Top officials from Denmark and Greenland said after a visit to the White House on Wednesday that they hadn't persuaded President Trump to abandon his ambitions to annex Greenland.

Vice President JD Vance and Secretary of State Marco Rubio hosted the Danish and Greenlandic foreign ministers at the White House in the midst of an extraordinary standoff between the U.S. and its closest allies over the future of the island of 57,000 people. Political leaders in Greenland, a semiautonomous territory of the Danish kingdom, have repeatedly insisted that their home isn't for sale after Trump's plans sparked blowback.

Jamie Dimon Seemed to Have Trump Figured Out-Until This Week

Jamie Dimon has worked carefully to rebuild his broken relationship with President Trump. The fight over Fed chair Jerome Powell is threatening to blow it up again.

The head of JPMorgan Chase, well-known for impassioned stances on policy, had tempered his approach with Trump over the past year, offering overall expressions of support with careful criticism of specific policy details. It appeared to be working-he had met with the president and White House officials several times to discuss economic policy in recent months.

Rio Tinto, BHP Join Forces to Unlock More Australian Iron Ore

Rio Tinto and BHP Group have agreed to work together on some new projects at neighboring iron-ore mines in Australia that could help bolster their future production of the steel ingredient.

The companies said that by collaborating on new projects at their neighboring Yandicoogina and Yandi iron-ore operations in Australia's Pilbara region, they could extract up to 200 million metric tons of iron ore, some of which might have otherwise been stranded.

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Expected Major Events for Thursday

00:01/UK: Dec RICS Residential Market Survey

05:30/NED: Dec Unemployment

07:00/ROM: Nov Industrial production

07:00/SWE: Dec CPI

07:00/GER: Dec WPI

07:00/NOR: Dec External trade in goods

07:00/UK: Nov UK trade

07:00/UK: Nov Index of production

07:00/UK: Nov Index of services

07:00/UK: Nov Monthly GDP estimates

07:00/NOR: 4Q Business tendency survey

07:45/FRA: Dec CPI

08:00/CZE: Nov Retail trade

08:00/SPN: Dec CPI

08:00/SVK: Dec CPI

08:00/SVK: Dec Core & net inflation development

09:00/ITA: Nov Industrial Production

09:00/GER: Annual GDP - first provisional calculation

09:00/POL: Dec CPI

09:00/BUL: Dec CPI

09:30/UK: 4Q Bank of England Credit Conditions Survey

09:30/UK: 4Q Bank of England Bank Liabilities Survey

10:00/EU: Nov Industrial Production

10:00/EU: Nov Foreign trade

10:00/CRO: Dec CPI

11:00/IRL: Nov Goods Exports and Imports

11:00/ITA: Nov Foreign Trade EU

11:00/IRL: Dec CPI

11:00/FRA: Nov OECD Harmonised Unemployment Rates

11:00/FRA: 3Q OECD Quarterly Labour Market Situation

12:30/UK: Dec NIESR Monthly GDP Tracker

All times in GMT. Powered by Onclusive and Dow Jones.

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This article is a text version of a Wall Street Journal newsletter published earlier today.

(END) Dow Jones Newswires

01-15-26 0015ET