16/01/2026 Daily Reports
Geopolitical Pivot : Global markets shifted into “risk-on” mode after President Trump stated that tensions with Iran are easing. This effectively removed the immediate war premium from commodities, triggering a sharp sell-off in safe-haven assets.
Commodities:
Oil: Brent crude plummeted approximately 3.4% to test the $66/bbl level as fears of Middle East supply disruptions faded.
Gold: Spot prices retreated ~0.5% from recent record highs ($4,642/oz) as investors rotated capital out of defensive assets.
Natural Gas: Prices are consolidating around $3.38/MMBtu, holding steady despite larger-than-expected inventory withdrawals.
Equities & Tech:
US (Nasdaq): After initial softness, Nasdaq futures turned positive, buoyed by a rebound in semiconductor stocks (fueled by strong TSMC earnings) and a new US-Taiwan trade deal.
Japan (Nikkei): The Nikkei 225 bucked the broader positive trend, closing lower by ~0.9% due to profit-taking, reversing from recent all-time highs.
Europe (DAX): European markets opened moderately higher, supported by the stabilization in US tech and calm reaction to inflation data.
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- Oil’s 4% Slide: ICE Brent prices plunged over 4.15% yesterday, settling near $61.76/bbl. The sell-off was triggered by President Trump’s remarks suggesting that the “killing has stopped” in Iran’s crackdown on protesters, leading markets to believe immediate US military intervention is off the table.
- The “Hormuz” Premium Evaporates: The fear of a blockade at the Strait of Hormuz—where 20 million barrels of oil pass daily—had pushed prices to 12-week highs. As the “Trump strike” narrative cools, this risk premium is rapidly leaking out of the market.
- European Gas Rally: While oil falls, European natural gas (TTF) rallied over 4.2%, climbing back above €33/MWh. A forecasted cold snap for late January and EU storage levels sitting below 52% (well under the 67% average) are keeping the bulls in control of the heating season.
- Cocoa’s Decade Low: London cocoa prices fell 2.3% following dismal data showing that European cocoa grindings (a measure of demand) hit their lowest level since 2013. Total grindings for 2025 are down 6.1% year-on-year.
- Sugar Surge in India: India’s sugar production jumped 21% year-on-year reaching 15.9mt as of mid-January. Despite the surge, the market is closely watching how much of this will be diverted to ethanol production.
- Wheat Surplus Growing: The International Grains Council (IGC) raised its global wheat output forecast to 842mt, leading to an increase in ending stock estimates. This “supply cushion” is likely to keep a lid on bread and cereal inflation globally.
What’s Next?
- We are seeing a massive “sigh of relief” in the energy complex. The market was braced for a repeat of the Venezuelan operation in Tehran, but the Trump administration seems to be pivoting toward secondary tariffs (25% on countries trading with Iran) rather than “boots on the ground” or missiles.
