Morning Brew January 21 2026

Good morning,

Yesterday, all three major U.S. equity benchmarks experienced their steepest one-day declines in three months – Once again Donald Trump is in the center of global wealth destruction.  The VIX index surged above 20, while the dollar recorded its largest drop in a month. Treasuries were sold off, sending the 30-year Treasury yield rapidly approaching the 5% threshold, currently at 4.92%. The Swiss Franc led gains among G10 currencies against the USD, trading slightly above 0.7900, as investors sought safety amid uncertainty surrounding U.S.-Europe trade tensions and the Greenland issue.

Nvidia, Tesla, and Meta saw significant losses, dropping 4.4%, 4.2%, and 2.6%, respectively. Despite Netflix surpassing Wall Street's revenue and earnings estimates for its holiday quarter on Tuesday, its shares fell more than 4% in after-hours trading.

Overnight, we witnessed a minor recovery following comments from Trump, who stated, "I think we will work something out where NATO is going to be very happy and where we're going to be very happy. But we need it for security purposes. We need it for national security." These remarks were interpreted as a potentially less aggressive stance. Equity indexes rebounded slightly, increasing by no less than 0.5% for the major U.S. indexes, as well as the GER40 and the EU Stocks 50.

The notable movement was once again in precious metals: gold gained 2% since yesterday's record close near 4880, and silver is re-testing the 95 level.

Today, attention turns to Switzerland, where Donald Trump is expected in Davos with 300 staff members. Discussions surrounding Greenland will be a focal point and a key market driver. Trump is scheduled to speak at 14:30, although the address may be delayed due to issues with one of his planes. For the schedule of the World Economic Forum events, visit Programme > World Economic Forum Annual Meeting | World Economic Forum

Yesterday, we observed an intriguing reaction as the Danish Pension Fund AkademikerPension announced its intention to rotate out of U.S. treasuries. Although the amounts involved are not significant, this move is seen as an interesting way to exert pressure on the U.S. economy if multiplied.

U.S. Treasury Secretary Bessent mentioned that there are four leading candidates for the new Fed chair position, with an announcement possibly expected by next week.

There is no particularly outstanding economic news today, and I anticipate politics to be the primary market driver. The risks of a further escalation is real and the impact can be enormous, scarily it will largely depend largely on Trump`s ego – Tough or TACO?

If you are looking for a distraction, there is a curious clash on x between Elon Musk and Ryanair on X.

Trade safely

Wednesday January 21

Data UK CPI

Earnings Charles Schwab Johnson & Johnson, Halliburton.

Speakers:  WEF in Davos

Thursday January 22

Data Japan Trade Data, US GDP Final, Initial Jobless Claims, Australia CPI & PMI

Earnings P&G, Intel Alcoa.

Speakers:  WEF in Davos

Friday January 23

Data Japan CPI International PMI; University of Michigan

Earnings Ericsson

Speakers:  WEF in Davos