Trump Tells Iran Time Running Out & AI in Focus for Tech Earnings | Daybreak Europe 1/29/2026

Bloomberg Daybreak Europe – Market Summary (April 25, 2024)

Key Concepts:

• Market Volatility: Driven by geopolitical tensions (Iran, potential US government shutdown), fluctuating dollar strength, and earnings reports.
• Earnings Season: Significant day for both US (MAG 7) and European (banks, SAP, Nokia, Sanofi) earnings releases.
• Interest Rate Policy: Fed’s decision to hold rates steady, despite pressure for cuts, and the implications of dissenting voices within the FOMC.
• Debasement Trade: Investor movement into precious metals (gold, silver, copper) as a hedge against currency devaluation and geopolitical uncertainty.
• AI Investment & Tech Divergence: Contrasting performance of tech companies based on AI investment strategies (Meta vs. Microsoft).
• Geopolitical Risk: Impact of US-Iran tensions, potential US government shutdown, and China-US relations on markets.

1. Market Overview & Macroeconomic Factors

The market experienced a rebound following comments from Scott Bessent regarding US intervention in the Yen, but the dollar subsequently weakened due to threats from President Trump concerning Iran and the looming possibility of a US government shutdown. This uncertainty fueled a surge in safe-haven assets, with gold reaching near $5,600, and futures pointing higher across the Atlantic. Key economic data releases expected include US jobless claims. The overall market sentiment is characterized by volatility and sensitivity to geopolitical events.

2. Federal Reserve & Monetary Policy

Jerome Powell’s decision to hold interest rates steady was broadly supported by the FOMC, despite dissenting votes from Christopher Waller and Stephen Miran. Powell defended the Fed’s independence amidst criticism from President Trump. Analysts noted the significance of Bowman not dissenting, suggesting a more hawkish stance than anticipated. The Fed’s stance is contributing to a complex market environment, with limited impact on markets despite the lack of rate cuts.

3. Earnings Reports – US Tech Sector

• Meta: Shares gained after reporting record sales and a strong forecast, driven by its core advertising business. The company is aggressively investing in AI and capital expenditure (potentially up to $135 billion this year).
• Microsoft: Shares plummeted due to concerns about the timeline for returns on its AI investments. While cloud revenue grew by 30%, spending commitments increased by 66%, creating investor concern about the pace of profitability.
• IBM: Shares jumped after hours, exceeding analyst expectations with strong growth in its software unit.
• Apple (Upcoming): Anticipation surrounds Apple’s earnings, particularly regarding iPhone 17 demand, the China market, and the integration of AI (Gemini partnership for Siri).

4. Earnings Reports – European Companies

• Deutsche Bank: Reported a fourth-quarter net revenue of €7.7 billion and expects revenue to increase to approximately €33 billion. Announced a €1 billion share buyback despite a recent raid by German authorities related to past dealings with sanctioned Russian individuals.
• Sanofi: Posted higher-than-expected quarterly profits and forecasts continued revenue and earnings growth. Focus remains on its obesity drug and cost discipline.
• Nokia: Adjusted operating profits came in at €1.06 billion, in line with estimates. The company is heavily investing in AI, leveraging partnerships with NVIDIA, and pivoting away from traditional telecommunications equipment. Stock is up 10% from a December low.
• SAP: Announced a share buyback of up to €10 billion and forecast cloud revenue growth in 2026. The company is transitioning customers from older technology to cloud-based services.

5. Commodity Markets & Currency Trends

Gold, silver, and copper reached record highs, driven by a combination of the “debasement trade” (investors diversifying away from the US dollar), geopolitical uncertainty, and risk aversion. Analysts suggest the rallies are becoming “frothy” and potentially unsustainable. The dollar weakened despite comments from Scott Bessent, contributing to the rise in precious metals. Investors are seeking alternatives to the US dollar, but other major currencies are not seen as particularly attractive.

6. Geopolitical Risks & International Relations

• US-Iran Tensions: President Trump’s threats of military strikes against Iran are increasing market volatility.
• US Government Shutdown: The potential for a US government shutdown adds to uncertainty.
• China-UK Relations: UK Prime Minister Rishi Sunak is visiting China to discuss trade ties, aiming for a more “sophisticated” relationship while acknowledging differences. He brought a football shirt as a gift for Xi Jinping.
• US-China Tech Competition: NVIDIA is optimistic about receiving approval from the Chinese government to sell its H200 chips.
• Arctic Strategy: US, Danish, and Greenland officials are discussing a new framework for Greenland, addressing President Trump’s demand for a stronger American presence in the Arctic.

7. Notable Quotes

• Jerome Powell: “It’s very important [Fed independence] and the reason it’s important is it enabled central bank generally not to be perfect.”
• Bloomberg Analyst: “This is a meeting where we expected almost nothing. And he managed to outdo our expectations by delivering less than nothing.” (referring to Powell’s press conference)
• Bloomberg Analyst: “The job of modern central banking is to make it as boring as possible. So sounds like Jay Powell managed to achieve that for you.”
• Elon Musk: “Our Northstar is building the best place for individuals to make a massive impact. To do this we are investing in native tooling to get more done.”

8. Data & Statistics

• Gold Price: Reaching near $5,600 per ounce.
• Deutsche Bank Q4 Net Revenue: €7.7 billion.
• Deutsche Bank 2026 Revenue Expectation: Approximately €33 billion.
• Nokia Adjusted Operating Profits: €1.06 billion.
• Meta Capex Spending (Potential): Up to $135 billion this year.
• Microsoft Cloud Revenue Growth: 30%.
• Microsoft Spending Commitments Growth: 66%.
• Sanofi Q4 Profit: Higher than expected.
• Norway Wealth Fund: Reduced stakes in major US tech firms.

Conclusion:

The market is navigating a complex landscape of geopolitical risks, fluctuating interest rate expectations, and diverging performance within the tech sector. Earnings season is providing valuable insights, but uncertainty remains high. The “debasement trade” is driving demand for safe-haven assets, while investors closely monitor the Fed’s actions and the evolving global political situation. The focus remains on navigating volatility and identifying opportunities amidst the ongoing uncertainty.