((Automated translation by Reuters using machine learning and generative AI, please refer to the following disclaimer:
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American stock indices move up and down, with a slight increase at the end of the session
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European stocks hit records, FTSE 100 hits 10,000 points
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Focus on Fed policy as Powell’s term nears end, delayed data crucial
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Gold and silver gains take pause after record year, dollar strengthens
(Updated until mid-afternoon) by Stephen Culp
U.S. stocks faltered on Friday, U.S. Treasury yields rose and the dollar strengthened on the first trading day of 2026.
While the three major U.S. stock indexes oscillated for most of the session, they were nominally higher and poised to end their four-session losing streak at the end of the week and start of the year.
Despite this, all three indexes were on track to post losses for the holiday-shortened week. “When you turn the page to a new year and you’re a money manager, you’re waiting to see, you know, what’s going to be, for lack of a better word, the mood for the year ahead,” said Jed Ellerbroek, portfolio manager at Argent Capital, in St. “Value is outpacing growth and AI infrastructure is up, and a lot of stocks that are doing well in sectors like utilities and industrials in particular, energy probably as well, are actions that benefit from AI”
Stocks rose sharply in 2025 as markets weathered a year of tariff wars, the longest government shutdown in U.S. history, geopolitical conflicts as well as threats to central bank independence.
THE FED’S YEAR AHEAD Markets will focus on monetary policy in the coming year, as Jerome Powell nears the end of his term as Federal Reserve chairman and economic data releases return to a more regular, routine schedule following the federal government shutdown. A series of lagging indicators expected in the coming days could be decisive for the central bank’s path forward. “One of the most important things will be maintaining the independence of the Fed,” said Thomas Martin, senior portfolio manager at Globalt in Atlanta. “Even though the newer members were appointed by (US President Donald) Trump and they’re more dovish, they want to at least give the impression that the Fed is independent, because once you lose that, you’re kind of in trouble.” But Mr. Ellerbroek disagrees: “President Trump has made it clear that he will appoint someone to the presidency who is willing to follow his instructions and that he wants rates significantly lower than today,” adding that “the short-term enthusiasm for lower rates is tangible.”
The extent to which markets are beginning to reap the rewards of massive investments in nascent artificial intelligence technology will also come under scrutiny in the year ahead.
The new year also promises some volatility geopolitically, with the U.S. Congressional midterm elections this fall and ongoing negotiations to end Russia’s war in Ukraine, as well as ongoing tensions in the Middle East. The Dow Jones Industrial Average .DJI rose 321.27 points, or 0.67 percent, to 48,384.56, the S&P 500 .SPX rose 18.12 points, or 0.26 percent, to 6,863.62 and the Nasdaq Composite
.IXIC rose 28.05 points, or 0.12%, to 23,270.04.
European stocks started the new year at record highs, with a boost from technology and defense stocks. Investors monitored the STOXX 600 which approached the 600 point mark. The London FTSE 100 .FTSE index reached the symbolic bar of 10,000 points for the first time. MSCI’s index of world stocks .MIWD00000PUS rose 4.76 points, or 0.47 percent, to 1,019.50. The pan-European STOXX 600 index .STOXX rose 0.67%, while the European FTSEurofirst 300 index .FTEU3 gained 16.23 points, or 0.69%.
Emerging Markets shares .MSCIEF rose 23.82 points, or 1.69 percent, to 1,429.14. MSCI’s index of Asia-Pacific stocks excluding Japan .MIAPJ0000PUS closed 1.71 percent higher at 734.93, while Japan’s Nikkei .N225 lost 187.44 points, or 0.37 percent, to 50,339.48.
GOLD AND SILVER TAKE A BREAK
Gold and silver pared earlier gains and advanced only modestly after a bout of profit-taking at the end of a year in which precious metals posted remarkable gains.
Gold’s 2025 rally was the biggest in 46 years, while silver and platinum recorded their biggest gains, driven by a cocktail of factors including Fed rate cuts, geopolitical crises, massive central bank purchases and the influx of exchange-traded funds (ETFs). Spot gold XAU= rose 0.22% to $4,323.75 an ounce, while spot silver XAG= rose 1.7% to $72.45 an ounce. The dollar rose following the greenback’s biggest annual decline in eight years. The dollar index =USD, which measures the greenback against a basket of currencies including the yen and the euro, rose 0.23% to 98.47, with the euro EUR= down 0.26% at $1.1715. Against the Japanese yen JPY=, the dollar strengthened by 0.17% to 156.92. On the crypto-currency side, bitcoin BTC= gained 1.92% to $89,989.28. Ethereum ETH= rose 4.6% to $3,124.11.
U.S. Treasury bond yields rose as markets awaited next week’s round of jobs data for guidance on economic health heading into the new year. The yield on US 10-year benchmark bonds
US10YT=RR rose 4.2 basis points to 4.195%, up from 4.153% late Wednesday. The yield on the 30-year bond US30YT=RR rose 4.1 basis points to 4.8712%, up from 4.83% late Wednesday. The yield on the two-year bond US2YT=RR, which typically moves based on the Federal Reserve’s interest rate forecasts, rose 1.2 basis points to 3.482%, from 3.469% late Wednesday.
Oil prices fell after posting their biggest annual loss since 2020, as investors weighed concerns over oversupply and geopolitical risks. US crude CLc1 plunged 0.17% to settle at $57.32 per barrel, while Brent LCOc1 settled at $60.75 per barrel, down 0.16% on the day.