Global Market News
Global Equities Down
Global equities were down on the week. The S&P 500 and Dow Jones lost 0.24% and 0.54%, respectively, while the Nasdaq decreased 0.53%. The US 10-year Treasury note continued its decline to close Friday at 4.49%. The price of a barrel of West Texas Intermediate crude oil continued its downward trend, ending the week at $71.01. Volatility, as measured by the CBOE Volatility Index, was higher at the beginning of the week amid talk of tariffs but settled Friday at 16.54.
US Employment Data Sends Mixed Signals
In December, US job openings decreased to 7.6 million from an upwardly adjusted 8.16 million in November, marking the lowest level since September. Despite a modest increase of 143,000 in nonfarm payrolls in January, average hourly earnings rose by 0.5%, and the unemployment rate dropped to 4% from 4.1%. Additionally, payroll figures for the previous two months were revised upwards by 100,000. After annual benchmark adjustments, the US economy saw an average monthly job growth of 166,000, down from the initially reported 186,000. The data suggests that the labor market is still solid, but growing more slowly than in December, and reinforced expectations that the Federal Reserve will keep rates steady.
International Developments
Trump Proposes US Control Over Gaza in Meeting with Netanyahu
On Tuesday, US President Donald Trump met with Israeli Prime Minister Benjamin Netanyahu at the White House, marking the first foreign leader visit of Trump’s second term. During the meeting, Trump controversially suggested that the United States should “take over” a depopulated Gaza to ensure long-term stability. His remarks come amid a tenuous ceasefire in Gaza following a 15-month Israeli military campaign that has killed an estimated 61,700 Palestinians, with a truce set to expire on March 1st. Trump also announced the reinstatement of his “maximum pressure” campaign against Iran and the US withdrawal from the UN Human Rights Council and UNRWA, moves closely aligned with Netanyahu’s policy goals.
North Korean Troops Appear to Pullback Amid Heavy Losses in Ukraine
Since mid-January 2025, North Korean troops deployed to Russia’s Kursk region have disappeared from the battlefield, with South Korea’s National Intelligence Service (NIS) estimating that at least 3,000 of the 11,000 deployed last December have been killed or wounded. Ukrainian President Volodymyr Zelenskyy stated that up to 4,000 North Korean soldiers had been lost, with reports indicating they were used in high-risk assault operations and often executed rather than being captured. Meanwhile, Russian forces suffered 48,240 casualties in January, with 15,000 losses concentrated around Pokrovsk, yet territorial gains dwindled to 498 square kilometers, down from 593 square kilometers in December. As the war drags on, Ukrainian sources suggest that an additional 25,000 North Korean reinforcements may be en route, highlighting Russia’s reliance on foreign manpower despite staggering losses.
Malawi to Withdraw Troops from DR Congo Amid Rising Conflict
On February 7th, Malawi’s President Lazarus Chakwera ordered the withdrawal of Malawian troops from the Southern African Development Community (SADC) military mission (SAMIDRC) in the Democratic Republic of Congo. This decision follows the deaths of at least 20 peacekeepers, including three Malawians, after M23 rebels captured the key city of Goma last week. Despite a unilateral ceasefire declared by M23 on February 5th, fighting has continued, with rebels seizing Nyabibwe in South Kivu. South Africa, leading the 5,000-troop mission, has pledged to remain, while SADC leaders are set to
US and Social Developments
Trump Pauses Tariffs on Canada and Mexico but Targets China
US President Donald Trump agreed to a 30-day pause on 25% tariffs for Canada and Mexico after securing border security commitments from Prime Minister Justin Trudeau and Mexican President Claudia Sheinbaum. Canada pledged a $1.3 billion border plan with 10,000 personnel to curb migration and fentanyl trafficking, while Mexico deployed 10,000 National Guard troops to its northern border. Meanwhile, a 10% tariff on Chinese imports took effect on February 4th, prompting Beijing to retaliate with duties on US coal, LNG, crude oil, and machinery. As trade tensions escalate, Trump signaled potential tariffs on the European Union, while economists warned of rising consumer prices and market instability.
Rubio Takes Over USAID as Trump Moves to Dismantle Agency
Secretary of State Marco Rubio has assumed the role of acting administrator of USAID, signaling the agency’s transfer to the State Department following a directive by President Trump. Rubio delegated key authority to Pete Marocco, a controversial Trump appointee accused of undermining USAID, who subsequently froze nearly all foreign aid. The move follows Trump’s sweeping executive order pausing foreign aid for 90 days and Elon Musk’s public claim that Trump approved shutting down the agency. Democratic lawmakers have condemned the takeover as unconstitutional, vowing legal action, while USAID employees report mass disruptions, lost system access, and agency-wide upheaval. Last night, a federal judge made a move to temporarily block President Trump from placing 2,200 USAID workers on paid leave, hours before it was supposed to happen.
Corporate/Sector News
SoftBank and OpenAI Launch SB OpenAI Japan to Advance AI Services
On Monday, SoftBank Group and OpenAI announced the creation of SB OpenAI Japan, a 50-50 joint venture aimed at expanding AI services, with SoftBank committing $3 billion annually to integrate AI into its companies. At an event in Tokyo, SoftBank CEO Masayoshi Son introduced “Cristal,” an AI service for business applications, while OpenAI CEO Sam Altman highlighted a new “deep research” feature enabling ChatGPT to perform complex research tasks. Both companies are also involved in the US-backed $500 billion Stargate AI project, with Son confirming plans to expand its reach beyond the US into Japan and other nations.
Trump Signs Executive Order for US Sovereign Wealth Fund
This week, President Donald Trump signed an executive order directing officials to develop a plan for creating a US sovereign wealth fund, aiming to manage the government’s assets, valued at $5.7 trillion. Treasury Secretary Scott Bessent and Commerce Secretary-designate Howard Lutnick are tasked with formulating the plan within three months, with the fund set to be established within the next year. Trump suggested that assets such as a potential stake in TikTok could be included in the fund, drawing comparisons to successful models like Saudi Arabia’s $925 billion Public Investment Fund. Sovereign wealth funds, such as Norway’s $1.7 trillion Government Pension Fund Global, are used worldwide for economic diversification and long-term wealth generation.
Honda-Nissan Merger Delayed Amid Leadership Disputes
On February 5th, Nissan withdrew from the proposed merger with Honda due to disagreements over management control, causing significant delays in the discussions. The two automakers had entered formal talks in December 2024 to create a $54 billion holding company, with plans to go public by 2026, but Honda’s proposal to make Nissan a subsidiary and control the majority of board seats was opposed by Nissan. Honda also expressed dissatisfaction with Nissan’s slow internal restructuring efforts, further straining negotiations. Mitsubishi, invited to join the merger, has decided to hold off on a decision, possibly opting for continued independence.
Corporate Profile
Palantir Technologies: AI Growth and Strategic Expansion
Palantir Technologies (NASDAQ: PLTR), led by CEO Alex Karp, has seen significant growth, with its shares surging 28% on February 4th, following strong Q4 results. The company reported a 36% revenue increase to $828 million, driven largely by its US market, where commercial revenue rose 64% and government revenue increased by 45%. Palantir’s success is largely attributed to its AI platform (AIP) and innovative “Ontology” technology, which enhances enterprise productivity by integrating AI with business operations. With a focus on expanding commercial markets, Palantir aims to sustain momentum, forecasting 31% revenue growth for 2025, while its stock valuation remains high, sparking debate on its future trajectory.
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Source: Wall Street Journal
