Daily Market Outlook, February 3, 2026 

Patrick Munnelly, Partner: Market Strategy, Tickmill Group

Munnelly’s Macro Minute…

Asian markets bounced back strongly after experiencing their steepest decline in over two months. Precious metals like gold and silver also saw a notable rebound following Monday's market turbulence, while technology stocks led a spirited rally. The MSCI Asia Pacific Index soared 2.8%, marking its best single-day performance since April. This was a period when markets had rebounded from earlier lows after former U.S. President Donald Trump introduced historically high tariffs. South Korea's stock market, a standout performer this year and a key player in the AI sector, jumped 6.3%. Tech giants Samsung and SK Hynix were among the top gainers, climbing 10% and 7.3%, respectively. In other developments, Australian bonds declined as the country’s central bank raised its benchmark interest rate to combat inflation, which also pushed the Australian dollar higher. Over in India, equities climbed 2.8% after Trump announced plans to lower tariffs on Indian goods to 18%. This decision came after Indian Prime Minister Narendra Modi committed to halting purchases of Russian energy, helping to ease tensions between the two nations. The Indian Rupee also gained strength against the U.S. Dollar. Gold prices shot up by as much as 4.2%, while silver surged 8.1%, recovering some ground after a sharp selloff in previous sessions that had dragged prices down from record highs. However, not all sectors shared in the optimism. In Hong Kong, Chinese internet companies faced declines on Tuesday amid concerns over potential increases in value-added tax, casting a shadow over the broader tech rally in the region.

Domestically, this week's February MPR from the BoE includes an annual supply-side review. Unlike the OBR's productivity downgrade, the BoE's projections remain grounded, aligning with the OBR's 0.7-0.8% annual productivity gains. However, the BoE's potential growth rates of 1.7% (2026) and 1.5% (2027) now seem optimistic compared to the OBR's 1.3%. This reflects last year's upgraded population estimates, but with new ONS data delayed until April, there's limited new information. Population growth drives total hours worked, yet offsets like rising out-of-work benefits and reduced average weekly hours persist. The MPC's concerns about potential supply suggest any population-related upside will likely be negated by participation and hours dynamics. Overall, the review is unlikely to reveal significant spare capacity, with the economy expected to operate at full capacity by 2028, implying only a marginally dovish policy impact.

The US Bureau of Labour Statistics announced that the monthly employment report, originally scheduled for Friday, will be delayed due to the government shutdown, as will today's job openings report. Since the shutdown began Sunday and is expected to be temporary, survey fieldwork should already be complete, meaning the reports will eventually be released, unlike during longer shutdowns. The delay affects the final benchmark revisions for employment levels up to March 2025, with preliminary estimates last summer showing a significant reduction of 911,000 jobs. Any major revision could influence market reactions, but with the report expected before the March FOMC decision, political factors like Warsh’s confirmation hearing may have a greater impact on rate path pricing.

Overnight Headlines

• Australia Raises Key Interest Rate To 3.85% To Combat Inflation

• Trump Unveils $12B Mineral Reserve With Record Ex-Im Loan

• UK PM Seeks To Push Forward With Delayed Defence Investment Plan

• Reeves Urges UK, EU To Speak With One Voice On Trade With Trump

• France Adopts Budget After Premier Survives No-Confidence Votes

• Trump, Modi Announce Trade Deal That Cuts Tariffs On India To 18%

• US And Iran Plan Talks In Istanbul, As Trump Warns Of ‘Bad Things’

• Global Bond Sales Reach $1T At Their Fastest Pace Ever

• Palantir’s Revenue Forecast For Year And Quarter Lap Consensus

• NXP Semiconductors Logs Higher Sales Amid Improving Demand

• Barclays: S&P 500 Falls 16% On Average With New Fed Chair

• BP Investors Demand Proof More Oil, Gas Spending Boosts Returns

• Donerail Group Offers To Buy MarineMax For $35/Share In Cash

• Virgin Media O2 Owners To Seal £2B Acquisition Of UK Broadband Rival

• Devon Agrees To Buy Coterra For $21.4B In US Shale Deal

• Google Cloud, Liberty Global Strike Five-Year AI Partnership

• SpaceX CFO To Hold Investor Call To Discuss xAI Deal

FX Options Expiries For 10am New York Cut 

(1BLN+ represents larger expiries and is more magnetic when trading within the daily ATR.)

• EUR/USD: 1.1745-50 (1.1BLN), 1.1785-90 (1.2BLN), 1.1800-05 (1.1BLN)

• 1.1820 (461M), 1.1850 (3.9BLN), 1.1865-75 (1.1BLN), 1.1890-1.1900 (1.3BLN)

• EUR/CHF:0.9155 (280M). AUD/USD:0.6900-05 (774M)

• GBP/USD: 1.3740 (408M), 1.3785 (203M)

• USD/CAD: 1.3590-1.3600 (912M), 1.3780 (206M)

• USD/JPY: 155.00 (278M), 155.75-80 (1.1BLN)

CFTC Positions as of January 30th:  

• .Equity fund speculators have increased their net short position in the S&P 500 CME by 20,307 contracts, bringing the total to 420,688. Meanwhile, equity fund managers have raised their net long position in the S&P 500 CME by 27,365 contracts, resulting in a total of 909,993 contracts. 

• Speculators have reduced their net short position in CBOT US 5-year Treasury futures by 45,473 contracts, now totaling 2,091,046. Conversely, they have increased their net short position in CBOT US 10-year Treasury futures by 70,511 contracts, reaching 726,151 contracts. There has also been a reduction in the net short position for CBOT US 2-year Treasury futures by 6,123 contracts, now at 1,218,999. Furthermore, speculators have boosted the net short position in CBOT US UltraBond Treasury futures by 14,649 contracts, bringing it to 273,471. They have trimmed their net short position in CBOT US Treasury bonds futures by 14,903 contracts, which now stands at 8,167. 

• Bitcoin's net long position is recorded at 690 contracts. The Swiss franc has a net short position of -42,893 contracts, while the British pound shows a net short position of -16,162 contracts. The euro has a net long position of 132,134 contracts, and the Japanese yen has a net short position of -33,933 contracts.

Technical & Trade Views

SP500

• Daily VWAP Bullish

• Weekly VWAP Bearish

• Above 6950 Target 7050

• Below 6835 Target 6785

EURUSD 

• Daily VWAP Bearish

• Weekly VWAP Bullish

• Above 1.1950 Target 1.2150

• Below 1.1840 Target 1.1750

GBPUSD 

• Daily VWAP Bearish

• Weekly VWAP Bullish

• Above 1.38 Target 13950

• Below 1.3770 Target 1.3570

USDJPY 

• Daily VWAP Bullish

• Weekly VWAP Bearish

• Above 154.35 Target 156

• Below 153.50 Target 151

XAUUSD

• Daily VWAP Bearish

• Weekly VWAP Bullish

• Above 4850 Target 5100

• Below 4400 Target 4200

BTCUSD 

• Daily VWAP Bearish

• Weekly VWAP Bearish

• Above 81k Target 84k

• Below 80.5k Target 72k