Japan’s 10-year government bond yield declined toward 2.1% on Friday, hitting a six-week low as both headline and core inflation eased in January amid government measures to relieve cost-of-living pressures. Headline inflation dropped to 1.5% from 2.1%, the lowest since March 2022, while core inflation matched the Bank of Japan’s 2% target, marking the slowest pace in two years. The data gives the central bank additional time before considering interest rate hikes, particularly amid a tepid economic rebound last quarter. Meanwhile, Prime Minister Sanae Takaichi is set to open the new parliamentary session by outlining plans to boost strategic investment, pursue “active but responsible” fiscal policies, and advance assertive diplomacy. Elsewhere, the latest 20-year JGB auction drew weaker demand than the 12-month average, as lower yields tempered investor interest.

Japan 10-Year Yield Falls as Inflation Slows

The Australian dollar slipped to below $0.703 on Friday, heading for a roughly 1% weekly loss, pressured by a stronger US dollar and softer domestic PMI figures. Data showed February flash PMIs cooled across the board, pointing to slower growth but persistent inflation pressures. Composite, services, and manufacturing readings all eased from January, though each remained above 50, signaling continued expansion. Elsewhere, the greenback strengthened amid robust US economic data and hawkish signals from the Federal Reserve. Meanwhile, the likelihood of a March rate hike in Australia is rising. Markets now assign a 76% probability that the Reserve Bank will lift its cash rate by May, while the odds of a move as early as March have climbed to about 28%. The shift follows firmer domestic data and more hawkish signals from policymakers, though May remains the base case unless key data releases, including January’s monthly CPI and Q4 GDP, surprise strongly to the upside.

Australian Dollar Set for Weekly Loss

The yield on the US 10-year Treasury note eased to around 4.07% on Friday, paring gains from earlier in the week as escalating tensions between the US and Iran fueled safe-haven demand for Treasuries. The US military is bolstering its presence in the Middle East as President Donald Trump considers potential action to pressure Tehran at the negotiating table. On the economic side, Thursday’s data showed weekly jobless claims fell to a five-week low, while the US trade deficit widened in December and pending home sales slipped in January. Investors are now awaiting advance fourth-quarter GDP figures and the PCE price index report, the Federal Reserve’s preferred inflation gauge. Minutes from the latest FOMC meeting highlighted divisions among policymakers on the rate outlook, with some indicating further hikes may be needed if inflation remains elevated. Traders have scaled back expectations for aggressive easing but continue to price in two 25 basis point cuts before year-end.

US 10-Year Yield Slips on Geopolitical Risks

Hong Kong stocks dipped 233 points, or 0.9%, to 26,469 in early Friday trade, reversing gains from the prior session as markets reopened after the Lunar New Year break. Sentiment was dampened with mainland exchanges closed all week, while global risk appetite weakened amid a U.S. military buildup in the Middle East and a sharp selloff in private equity stocks that rattled Wall Street overnight. Locally, investors anticipated the release of January’s jobless rate later today, following three straight periods at 3.8%. Still, losses were capped by optimism about solid travel demand and spending in China during the Spring Festival. Tech and consumer names led declines in the Hang Seng index, offset partly by strength in property and financials. Major laggards included Pop Mart Intl. (-3.3%), Xiaomi (-3.2%), Kuaishou Tech (-3.0%), and Tencent (-2.3%). For the week, markets are on track for a drop, down around 0.6% so far, following a subdued performance in the prior period.

Hong Kong Stocks Slide as Trading Resumes Post-Holiday

The Japanese yen slipped past 155 per dollar on Friday, falling for the third consecutive session as both headline and core inflation rates slowed in January amid government measures to ease cost-of-living pressures. Headline inflation dropped to 1.5% from 2.1%, the lowest since March 2022, while core inflation matched the Bank of Japan’s 2% target, marking the slowest pace in two years. The data gives the central bank more leeway before considering interest rate hikes, particularly amid a lackluster economic rebound last quarter. Meanwhile, Prime Minister Sanae Takaichi is set to open the new parliamentary session with plans to boost strategic investment, pursue “active but responsible” fiscal policies, and advance assertive diplomacy. The yen is on track to decline about 1.6% this week, retracing roughly half of the previous week’s gains following Takaichi’s landslide election victory.

Japanese Yen Weakens as Inflation Eases

The benchmark KOSPI rose more than 1% to around 5,750 on Friday, extending its record-breaking rally as strength in industrial and defense shares offset mild profit-taking in semiconductor heavyweights. Doosan Enerbility jumped 6.7% and Hanwha Aerospace climbed 6.8%, while shipbuilders HD Hyundai Heavy Industries and Hanwha Ocean rose 2.3% and 2.9%, respectively, on optimism over deeper cooperation between the United States and South Korea in rebuilding shipbuilding capacity. Financial stocks also gathered ground, with KB Financial Group (1.5%) and Shinhan Financial Group (1.7%) posting gains. Meanwhile, semiconductor heavyweights Samsung Electronics (-0.3%) and SK hynix (-0.5%) hovered near historic highs, after booking small profits from recent gains. The upbeat tone in Seoul came despite declines in US equities, where rising tensions between Washington and Tehran pushed oil prices higher and weighed on risk appetite.

South Korean Shares Extend Rally to Fresh Record

The dollar index rose toward 98 on Friday and was poised for a roughly 1% gain on the week, supported by robust US economic data and hawkish signals from the Federal Reserve. On Thursday, weekly jobless claims fell to a five-week low, while the Philadelphia Fed business outlook survey unexpectedly jumped to a five-month high. However, the US trade deficit widened in December and pending home sales declined in January. Investors are now focusing on advance fourth-quarter GDP figures and the PCE price index report, the Fed’s preferred inflation gauge. Minutes from the latest FOMC meeting showed policymakers divided on the rate outlook, with some indicating further hikes could be warranted if inflation remains elevated. Fed Governor Stephen Miran noted he now anticipates a “less accommodative” rate path, citing resilient employment and persistent goods inflation. Traders have scaled back expectations for aggressive easing but continue to price in two 25 basis point cuts before year-end.

Dollar Heads for Strong Weekly Gain

The annual inflation rate in Estonia slowed to 3.7% in January 2026 from 4.1% in the previous month. This marked the lowest reading since November 2024, mainly driven by lower prices for clothing and footwear (-4.9% vs -6.6% in December), information and communication (-0.2% vs 2.2%), transport (-1.5% vs 7.6%), and insurance and financial services (-14.5% vs -13.2%). Additionally, inflation softened for education services (0.9% vs 1.7%) and miscellaneous goods and services (5.1% vs 7.7%). On the other hand, prices increased at a faster rate for food and non-alcoholic beverages (6% vs 5.6%), alcohol and tobacco (6.2% vs 5.3%), and housing (5.6% vs 0.7%). On a monthly basis, consumer prices rose by 1% in January, marking the first month of growth in five months and rebounding from a 0.6% decline in the preceding period.

Estonia Inflation Slows to 14-Month Low

Gold edged above $5,000 per ounce on Friday, loosely extending a two-day gain as traders weighed geopolitical risks alongside the Federal Reserve’s policy outlook. Tensions between the US and Iran escalated after President Donald Trump set a 10–15 day deadline for nuclear deal talks, while the US deployed its largest military force in the Middle East since the 2003 Iraq invasion. Meanwhile, Federal Reserve Governor Stephen Miran tempered expectations for this year’s rate cuts, citing stronger-than-expected economic data. Supporting this view, initial jobless claims fell to 206K last week, highlighting labor market resilience. Investors now await PCE data due later today. January FOMC minutes also showed policymakers divided on rates, with some signaling possible hikes if inflation remains elevated. Elsewhere, physical demand in Asia remains seasonally muted amid Lunar New Year. Bullion is set for a modest weekly loss.

Gold Nudges Higher

The S&P Global Japan Manufacturing PMI rose to 52.8 in February 2026 from 51.5 in January, marking the strongest expansion since May 2022, supported by firm domestic and external demand. Key sub-indexes for factory output and new orders both extended their uptrends in February, with firms frequently citing solid underlying demand and the favorable impact of new product launches. Robust overseas demand drove the fastest increase in new export orders in eight years. While the pace of job creation eased from January’s multi-year high, employment growth remained solid overall. Meanwhile, price data showed a slightly sharper rise in average input costs across Japan’s private sector in February. Looking ahead, Japanese manufacturers expressed greater optimism about the 12-month business outlook, anticipating that firmer demand conditions, rising demand for semiconductors and AI-related technologies, and continued product rollouts will underpin further expansion.

Japan Manufacturing PMI Hits Near 4-Year High

Japan’s S&P Global Services PMI edged up to 53.8 in February 2026 from a final 53.7 in January, according to flash data. The reading marked the highest level since May 2024, as new orders increased at the fastest pace in 22 months. Employment continued to expand, though the hiring rate eased from the previous month. On the price front, services companies recorded a steeper rise in selling prices than factories, leading to a notable rise in selling prices.

Japan Services PMI Hits Highest Since May 2024

The Nikkei 225 Index fell 1% to around 56,900 while the broader Topix Index slid 1.2% to 3,805 on Friday, breaking a two-day rally, with tech and bank stocks leading the retreat. Global risk appetite weakened amid escalating tensions between the US and Iran, with the US military increasing its presence in the Middle East as Trump weighs potential military action to pressure Tehran at the negotiating table. Investors also grew cautious ahead of key US economic releases that could shape expectations for Fed policy, particularly after minutes showed some officials were open to raising rates further if inflation remains persistent. Domestically, data indicated that Japan’s headline and core inflation slowed in January, reflecting government measures to ease cost-of-living pressures. Declines among major tech and bank shares were led by Tokyo Electron (-3.5%), SoftBank Group (-3.3%), and Mitsubishi UFJ (-2.2%). Both benchmark indexes were on track to finish the week largely unchanged.

Japanese Shares Fall as Tech, Banks Weigh

WTI crude oil futures traded above $71 per barrel on Friday, hovering near a six-month high and heading for a weekly gain of more than 5%, after President Donald Trump set a deadline for Iran to reach a nuclear agreement. Trump signaled that negotiations would likely have no more than 10 to 15 days to advance. At the same time, the US has deployed its largest military buildup in the Middle East since the 2003 Iraq invasion, raising the prospect of a broader and more sustained operation than last June’s overnight strike on Iran’s nuclear facilities. The move has heightened the risk of supply disruptions, with investors concerned that a US-Iran conflict could prompt Iran to restrict traffic through the Strait of Hormuz, a critical corridor for crude exports from the region. Adding to bullish momentum, government data showed US crude inventories fell by 9 million barrels last week, marking the steepest draw since early September.

Brent Heads for Strong Weekly Gain

WTI crude oil futures traded above $66 per barrel on Friday, hovering near a six-month high and heading for a weekly gain of more than 5%, after President Donald Trump set a deadline for Iran to reach a nuclear agreement. Trump signaled that negotiations would likely have no more than 10 to 15 days to advance. At the same time, the US has deployed its largest military buildup in the Middle East since the 2003 Iraq invasion, raising the prospect of a broader and more sustained operation than last June’s overnight strike on Iran’s nuclear facilities. The move has heightened the risk of supply disruptions, with investors concerned that a US-Iran conflict could prompt Iran to restrict traffic through the Strait of Hormuz, a critical corridor for crude exports from the region. Adding to bullish momentum, government data showed US crude inventories fell by 9 million barrels last week, marking the steepest draw since early September.

Oil Heads for Strong Weekly Gain

Japan’s S&P Global Composite PMI rose to 53.8 in February 2026 from a final 53.1 in the previous month, flash data showed. It marked the highest level since May 2023, driven by faster growth in both manufacturing output and services activity. Overall sales rose at the quickest pace in nearly three years, while new export orders expanded at the strongest rate in eight years, reflecting a sustained rebound in goods demand. Employment continued to increase at a solid pace, though slightly easing from January’s multi-year high. Backlogs of work accumulated at the fastest rate since composite records began in September 2007, underscoring capacity pressures. On the price front, both input costs and output charges rose at slightly faster rates. Looking ahead, business confidence reached a 15-month high, supported by new product launches, stronger tech demand, and the recent landslide election victory of the Takaichi administration.

Japan Composite PMI Hits 33-Month High

The S&P/ASX 200 slipped 0.2% to around 9,060 in early Friday deals, snapping a four-session winning streak, weighed down by losses in heavyweight miner Rio Tinto. The world’s largest iron ore producer tumbled as much as 3% after it reported annual earnings that fell short of expectations a day earlier, reflecting softer iron ore results despite solid gains in copper. Even so, the broader mining sub-index rose 0.4%, supported by strength in other major names. BHP climbed about 1%, while gold producers rallied alongside overnight gains in bullion prices driven by heightened geopolitical tensions. QBE Insurance also jumped after exceeding full-year profit forecasts on improved claims and investment income. Meanwhile, the financial sector hovered near record levels, as weakness in Commonwealth Bank offset gains in Westpac and ANZ. Local tech stocks retreated 2.6%, mirroring overnight weakness on Wall Street, with WiseTech Global dropping about 5%.

Australian Shares End 4-Day Win Streak

Japan’s core consumer price index, which excludes fresh food but includes energy, rose 2% year-on-year in January 2026, cooling from 2.4% in December and marking the weakest pace of growth in two years. The reading was in line with market expectations and aligned with the inflation target of the Bank of Japan, suggesting no immediate need to adjust monetary policy settings. The BOJ has indicated that price growth is likely to moderate further, partly due to additional government measures such as utility subsidies, as well as base effects from price surges a year earlier. Prime Minister Sanae Takaichi rolled out fiscal initiatives aimed at alleviating cost-of-living pressures, including proposals to suspend the 8% tax on food and reduce gasoline taxes. Nonetheless, authorities emphasized that they remain focused on underlying inflation trends rather than temporary or one-off factors.

Japan Core Inflation Slows to 2-Year Low

Food prices in Japan increased by 3.9% year-on-year in January 2026, slowing from a 5.1% gain in the previous month and marking the slowest rise since October 2024.

Japan Food Prices Rise the Least in 15 Months

Japan’s annual inflation eased to 1.5% in January 2026 from 2.1% in the prior month, the lowest since March 2022. Food inflation fell to a 15-month low (3.9% vs 5.1% in December), driven by the slowest rise in rice prices in 18 months. Core inflation slipped to 2.0% from 2.4%, the lowest since May 2022, within the central bank’s 2% target. Monthly, CPI fell 0.2%, following a 0.1% drop in December, the steepest decline since September 2024.

Japan Inflation Lowest Since 2022

US stock futures were broadly flat on Friday after coming under pressure in the previous session, as investors positioned for key economic releases that could influence expectations for Federal Reserve monetary policy. Markets are set to receive fresh insight into economic conditions with the advance estimate of fourth-quarter GDP, along with the PCE price index report, the central bank’s preferred inflation measure. Minutes from the Fed’s latest meeting showed policymakers were split over the outlook for interest rates, with some officials signaling they would consider further tightening if inflation proves persistent. Even so, traders continue to price in two 25 basis point rate cuts before year-end. In regular trading on Thursday, the Dow slipped 0.54%, the S&P 500 declined 0.28%, and the Nasdaq Composite dropped 0.31%. Eight of the 11 S&P sectors finished in negative territory, with financials, consumer discretionary, and technology shares leading the losses.

US Futures Steady Ahead of Key Data

New Zealand shares slipped 67 points, or 0.5%, to 13,377 in Friday morning trade, pausing a two-day rally after Wall Street retreated on geopolitical jitters. Investors weighed remarks from U.S. President Trump, who said he will decide within 10 days whether to launch military strikes against Iran. Profit-taking also pressured sectors including healthcare, non-energy minerals, and financials. Notable laggards included Briscoe Group (-1.7%), A2 Milk Co. (-1.5%), Vector Ltd. (-1.4%), and Napier Port Holdings (-1.3%). Despite the pullback, the market remains on track for a weekly gain of about 1.4% so far, rebounding from prior weakness. Support came from the Reserve Bank’s decision this week to hold cash rates steady at its first 2026 meeting, in line with estimates, signaling hikes would only follow stronger inflation and growth. On the trade front, January’s deficit narrowed as exports in the island nation outpaced imports, offering a modest boost to sentiment.

New Zealand Stocks Slip, Still Tracking Weekly Gain

The S&P Global Flash Australia Services PMI Business Activity Index fell to 52.2 in February from 56.3 in January, signaling expansion but at a softer pace. The slowdown reflected weaker services activity and slower growth in new business as customer demand cooled, while employment continued to rise and accelerated to its strongest pace in nearly three years, and outstanding workloads were unchanged after rising in January. Export demand increased only marginally and contributed less to new work inflows. Business confidence weakened to its lowest in just over a year and a half amid economic and competition concerns. On the cost side input price inflation and selling price inflation intensified from January as service providers became more aggressive in price setting.

Australia Services Activity Growth Seen Easing

The S&P Global Australia Manufacturing PMI fell to 51.5 in February 2026 from 52.3 in January, according to flash estimates, signaling continued expansion but at a slower pace. The moderation reflected softer growth in new orders and output, as overall new business cooled from January’s 45-month high and export demand increased only marginally. Manufacturers noted a loss of momentum alongside broader private sector slowing. Optimism about output over the next year remained positive, supported by expansion plans and expectations of improved demand, though confidence eased to its lowest level in just over a year-and-a-half amid concerns about economic conditions and elevated competition. Firms continued hiring, but manufacturing employment growth was the weakest in four months and backlogs were unchanged. Input costs rose at the fastest pace in ten months on higher supplier and raw material prices, while selling price inflation accelerated to its highest since September last year.

Australia Factory Activity Seen Expanding for 4th Month

The S&P Global Flash Australia Composite PMI fell to 52.0 in February from 55.7 in January, signaling expansion for a seventeenth month but at a softer pace than the start of 2026. Services activity eased, with the Services Business Activity Index at 52.2 in February compared with 56.3 in January, while the Manufacturing PMI slipped to 51.5 from 52.3 as both goods and services new business growth cooled and overseas orders for manufactured goods rose only marginally. Business sentiment remained positive but weakened to its lowest since mid 2024, and employment accelerated as firms hired to meet workloads with hiring reaching an 11-month high, while outstanding workloads were unchanged after rising in January. Input cost pressures and selling price inflation intensified from January, with manufacturing cost rises noted as a clear upside risk and both costs and charges at their highest since September 2025.

Australia's Private Sector Set for Slower Growth in February

New Zealand’s trade deficit shrank to NZD 519 million in January 2026 from NZD 549 million in the same month a year earlier. Exports rose 2.6% to NZD 6.2 billion, due to meat and edible offal (38%), precious metals, jewellery, and coins (88%), ships, boats, and floating structures (390%), albumins, gelatin, glues, and enzymes (67%). Exports to China were down 7.0%, to Australia up 20%, to the European Union up 16% and to Japan up 11%. Imports rose 1.9% to NZD 6.7 billion, led by higher vehicles, parts and accessories, electrical machinery and equipment, precious metals, jewellery, and coins, iron and steel and articles. Imports from China increased 24%, from the EU 5.6%, the US fell 17% and South Korea rose 36%.

New Zealand Trade Deficit Shrinks

The Dow Jones Index dropped -268 points or 0.54 percent on Thursday to close at 49395 points. Losses were led by Sherwin-Williams (-2.23%), Boeing (-2.19%) and IBM (-1.98%). Offsetting the fall, top gainers were Verizon (1.19%), Caterpillar (1.08%) and P&G (0.97%).

The Dow Jones Index Closes 0.54% Lower

The Ibovespa rose 1.4% to close at 188,534 on Thursday, rebounding toward historic highs as banks and energy shares drove a broad based rebound, while investors parsed through the latest economic data. Financial heavyweights led gains, with Banco do Brasil rising 2.3%, Banco Bradesco up 1.8% and Banco Santander Brasil advancing 1.2%, reflecting firm credit expectations and supportive domestic activity signals. In energy, Petrobras jumped 2.6% as stronger crude prices lifted revenue outlooks, while utilities such as Eletrobras surged 4.4%, adding defensive support. Meanwhile, WEG slid 3.8%, extending recent volatility.

Ibovespa Rebounds Toward Record Levels

The S&P/TSX Composite rose 0.6% to close at a record 33,595 on Thursday, as a broad commodity-led advance in energy and gold miners offset mixed financials and weakness in asset managers. Crude’s rebound lifted producers across the board, with Cenovus Energy jumping 4%, Imperial Oil up 2%, Canadian Natural Resources gaining 2% and Suncor Energy advancing 1.7%, amid higher prices amid Middle East supply risks. Gold miners also added support with bullion holding above $5,000, as Agnico Eagle Mines rose 1.7% and Barrick Gold edged 0.6% higher. Financials were mixed rather than a drag, with Bank of Montreal up 0.8% and CIBC gaining 1.6% while Royal Bank of Canada was flat. In technology, Shopify climbed 1.8%, helping counter a 2.6% drop in Brookfield.

TSX Renews Record High

The S&P 500 closed down 0.3%, the Nasdaq fell 0.4%, and the Dow lost 0.6% as investors pared risk after the FOMC minutes signaled that disinflation may take longer and that higher rates could be needed. Longer-dated yields rebounded, while crude rallied on the Iran standoff and President Trump’s comments about possible strikes, supporting energy shares but pressuring banks. Asset managers dropped after Blue Owl (-5.9%) tightened investor liquidity and sold $1.4 billion in loan assets, with Blackstone and Apollo down 5.4% and 5.2%, respectively. Software names, including Salesforce, Intuit, and Cadence, slid between 1.3% and 2.8% on renewed AI disruption concerns. Bank of America and Wells Fargo declined 1.1% each. Meanwhile, Walmart fell 1.4% despite beating fourth-quarter revenue estimates and raising its dividend, while Deere surged 11.6% following its earnings.

Wall Street Slips on Hawkish Fed Signals

Argentina’s trade surplus rose to USD 1,987 million in January 2026, up from USD 162 million a year earlier. Imports fell 11.9% year-on-year to USD 5,070 million, driven by a 12.1% decrease in quantities and a 0.2% rise in prices. Meanwhile, exports rose 19.3% to USD 7,057 million, led by an 18.5% increase in quantities and a 0.7% rise in prices. For the year-to-date through January 2026, the trade surplus stood at USD 1,987 million, up from USD 162 million in the same period of 2025.

Argentina Trade Surplus Sharply Expands in January

Sunflower oil futures eased toward $1,515 per tonne, retreating from the over three year highs reached on February 6th as expanding South American supply and softer seasonal demand loosened the previously tight balance in global vegetable oils. Shipments from Argentina are accelerating, highlighted by Bulgarian processors securing roughly 400,000 tonnes of competitively priced sunflower seed for March arrival, while Brazil’s record soybean harvest has pushed local soybean oil offers down, broadening the pool of cheaper substitute oils. At the same time palm oil futures have slipped, preserving palm’s position as the lowest cost option for major buyers such as India and intensifying competition for market share. Demand has also cooled as Lunar New Year holidays curbed Asian buying and Malaysian palm exports in the first half of February fell by 11% to 15%, with the approaching Ramadan period likely to temper Middle Eastern imports further.

Sunflower Oil Drops From Multi-Year Highs

Gasoline futures for delivery at the New York Harbor rose to over $2.0 per gallon in February, testing the highest level in five months as higher risk premiums for crude oil shipments lifted the costs of feedstock for refineries. Tensions between the US and Iran culminated in reports that the US could intervene militarily as soon as next week, with Israeli officials calling for a regime change in Tehran. The moves risked Iran's possible blockade in the Strait of Hormuz, a chokepoint for nearly one third of global tanker traffic. In the meantime, Ukrainian strikes in Russian refineries cut a major source of gasoline production, forcing Russian energy companies to export crude instead of gasoline. Stateside, the weekly inventory count by the EIA reflected a 3.2 million barrel draw in national stocks in the second week of February, more than market expectations of a 300 thousand decrease.

Gasoline Rises to Above $2 per Barrel

Brent crude oil futures extended their rally to $71.5 per barrel on Thursday, the highest since early August 2025 as rising tensions between the US and Iran threatened supply from the Middle East. Reports citing government officials noted that the US could begin a military operation in the Middle East soon, with Israel pushing for regime change in Tehran. The head of the United Nations nuclear watchdog warned Iran's window for a diplomatic deal is narrowing amid a US military build up. Conflict could threaten flows through the Strait of Hormuz, which sees tanker activity of a third flows for one third of seaborne oil trade. In the meantime, a fresh report from the EIA showed that oil inventories in the US plummeted by 9 million barrels on the second week of February, contrasting sharply with market expectations of a 2 million barrel build to fully erase the 8.5 million build from the previous week.

Brent Crude Rises Past $71

WTI crude oil futures extended their rally to $66.5 per barrel on Thursday, the highest since early August 2025 as rising tensions between the US and Iran threatened supply from the Middle East. Reports citing government officials noted that the US could begin a military operation in the Middle East soon, with Israel pushing for regime change in Tehran. The head of the United Nations nuclear watchdog warned Iran's window for a diplomatic deal is narrowing amid a US military build up. Conflict could threaten flows through the Strait of Hormuz, which sees tanker activity of a third flows for one third of seaborne oil trade. In the meantime, a fresh report from the EIA showed that oil inventories in the US plummeted by 9 million barrels on the second week of February, contrasting sharply with market expectations of a 2 million barrel build to fully erase the 8.5 million build from the previous week.

Crude Oil Extends Increase to 6-Month High

US heating oil futures rose toward $2.6 per gallon, as a larger than expected draw in US distillate inventories compounded tighter crude supplies and escalating Middle East tensions to reinforce near term supply risks. The EIA reported a 4.57 million barrel decline in distillate stocks for the week ended February 13th, more than triple forecasts for a 1.4 million barrel draw, alongside a 9.01 million barrel drop in crude inventories, underscoring firm refinery demand and limited buffer in fuel supplies. At the same time crude feedstock costs rose to the highest since August as US officials signaled Iran had not met key conditions in nuclear discussions and regional military activity near the Strait of Hormuz kept disruption risks elevated. While milder weather and softer natural gas prices may temper heating demand at the margin, the scale of inventory declines and higher input costs have tightened the physical balance and supported prices.

Heating Oil Rises Further After EIA

Frankfurt's DAX 40 finished about 0.9% down at 25,044 on Thursday, down from one-month highs reached in the prior day, as investors parsed some disappointing corporate results and weighed elevated geopolitical risks. Following the latest nuclear negotiations between the US and Iran, signs of a potentially imminent war are mounting. The mood was further dampened by the US Federal Reserve, which, in the minutes of its latest meeting, emphasized the risks posed by excessively high inflation. Renewed caution in the global tech sector also weighed. Among key movers, Airbus shares plummeted 6.7% to their lowest level since early December, despite reporting slightly higher Q4 profits, as the company lowered its main jet production target amid ongoing supply-chain constraints. Banks and tech companies also faced pressure. Automakers, led by BMW (-1.9%) and Volkswagen (-1.4%) tracked losses in French peer Renault following downbeat results.

DAX Closes on Lower Note

Italy’s FTSE MIB fell 1.2% to close at 45,794 on Thursday, trimming the 2.1% increase from the earlier two sessions as escalating geopolitical tension weighed on the outlook of growth and energy inflation. The US reinforced its military presence in the Middle East amid rising tensions with Iran despite recent talks. Enel fell 3.6% after the Italian government approved a two-percentage-point hike in its IRAP corporate tax on energy firms. Banks also declined on rising credit costs, with UniCredit down 2.4% and Intesa Sanpaolo losing 1.5%. Meanwhile, Fincantieri fell 11.8% after it announced a new share placement with institutional investors representing up to 10% of its share capital. On the upside, Tenaris surged 9.5% after reporting a 5% rise in fourth-quarter net sales, beating expectations. Eni gained 1.4% as oil prices climbed, while Leonardo added 1.9% amid renewed tensions.

Italy Shares Drop as Global Tensions Weigh

The FTSE MIB Index fell -567 points or 1.22 percent on Thursday to close at 45794 points. Leading the losses are ERG (-4.38%), Stellantis N.V. (-4.21%) and Enel (-3.83%).

The FTSE MIB Index Closes 1.22% Lower

The DAX Index dropped -235 points or 0.93 percent on Thursday to close at 25044 points. Losses were led by Airbus (-7.04%), BASF (-2.74%) and RWE (-2.58%). Offsetting the fall, top gainers were Rheinmetall (3.40%), Vonovia (1.41%) and Scout24 (1.38%).

The DAX Index Closes 0.93% Lower

The CAC 40 Index decreased -30 points or 0.36 percent on Thursday to close at 8399 points. The decline was led by Airbus (-7.04%), Stellantis NV (-4.37%) and Renault (-2.83%). On the upside, the strongest performers were Orange (7.14%), Carrefour (3.00%) and Pernod Ricard (2.91%).

The CAC 40 Index Closes 0.36% Lower

The FTSE 100 Index fell -73 points or 0.69 percent on Thursday to close at 10613 points. Leading the losses are Centrica (-4.54%), Barclays (-3.95%) and Rio Tinto (-3.94%). Top gainers were British American Tobacco (2.72%), BAE Systems (2.46%) and Relx (2.39%).

The FTSE 100 Index Closes 0.69% Lower

The average rate on a 30-year fixed mortgage dropped to 6.01% as of February 19th, from 6.09% in the previous week to the softest level since September 2022, according to data from Freddie Mac. “Mortgage rates dropped again this week, now down to their lowest level since September of 2022. This lower rate environment is not only improving affordability for prospective homebuyers, it’s also strengthening the financial position of homeowners. Over the past year, refinance application activity has more than doubled, enabling many recent buyers to reduce their annual mortgage payments by thousands of dollars,” said Sam Khater, Freddie Mac’s chief economist.

US 30-Year Mortgage Rate at September 2022 Low

US crude oil inventories fell by 9.014 million barrels in the week ended February 13, the largest decrease in five months and compared with expectations for a 2.1 million barrel build. Stocks at the Cushing, Oklahoma delivery hub also decreased by 1.095 million barrels. Gasoline inventories fell by 3.213 million barrels, above expectations for a 0.3 million barrel draw. Distillate stockpiles, which include diesel and heating oil, fell by 4.566 million barrels, a larger decline than forecasts for a 1.4 million barrel drop.

US Crude Oil Inventories Fall the Most in 5 Months

The CAC 40 fell 0.4% to close at 8,399 on Thursday, pulling back from record highs as losses in heavyweight industrials and luxury shares outweighed selective strength in defensives and energy. Airbus slumped 6.8% after trimming its main jet production target, marking the sharpest drag on the index, while luxury bellwethers LVMH and Hermes International fell 0.50% and 1.5% respectively, reflecting continued pressure on high end discretionary names. Carmakers also underperformed, with Stellantis down 4.4% and Renault losing 3.1% following its reported €10.9 billion net loss. On the other hand, Orange led the upside after adding 7.5% on the back of better-than-expected results, while Sanofi rose 1.7% and TotalEnergies SE rose 1.8% alongside firmer crude prices. The session reflected a broad based consolidation led by index heavyweights, as investors balanced corporate earnings disappointments against lingering geopolitical and policy uncertainty.

CAC 40 Retreats from Record High

European stocks closed firmly lower on Thursday to retreat from the record highs in the previous session, pressured by pessimistic earnings results and expectations that the Federal Reserve will maintain rates elevated for a longer period. The Eurozone's STOXX 50 lost 0.8% to 6,054 and the pan-European STOXX 600 dropped 0.6% to 624. Minutes from the Fed's last meeting indicated that a majority of policymakers see the risk of inflation taking longer than expected to return to target, while few members did not exclude a rate hike should inflation not soften. The outlook pressured banking stocks that have gained sharply this month, with UniCredit, Santander, and BBVA dropping more than 2%. Meanwhile, Airbus slid 7% after missing delivery forecasts for this year. In turn, Enel fell close to 4% after the Italian government increased corporate taxes on power utility companies.

European Stocks Pull Back from Records

German natural gas futures rose above €33 per megawatt-hour, rebounding from a five-week low of €29.82 on Feb 17, as fears grow that escalating tensions between United States and Iran could disrupt LNG flows through key Middle East routes. Markets are focused on shipments via the Strait of Hormuz, a route for about 20% of global LNG, including exports from Qatar, the second largest exporter. A report from Axios said US military action against Iran could come sooner than expected, with Israel pushing for regime change, raising risks to regional supply. Tight EU inventories add support, with European Union storage near 32.5%, the lowest since 2022, and Germany below 23%. Still, warmer weather, steady flows despite outages in Norway and stronger renewables in Germany are easing pressure.

Germany Natural Gas Futures Rebound from 5-Week Low

Brazil’s Industrial Business Confidence Index fell 0.3 point to 48.2 in February 2026, remaining below the 50-point threshold. The Current Conditions Index declined to 43.8, down 0.2 point from January. Entrepreneurs’ assessment of the broader Brazilian economy became slightly less negative (+0.6 point to 38.6), while perceptions of their own companies worsened (-0.6 point to 46.4). The Expectations Index also eased to 50.4, down 0.3 point. Expectations for firms weakened (-0.5 point to 54.3), while outlooks for the Brazilian economy improved marginally (+0.2 point to 42.7), though they remained in negative territory.

Brazil Industrial Confidence Slips Further in February

The FTSE 100 fell more than 0.5% on Thursday after closing at a record high on Wednesday as rising geopolitical tensions in the Middle East pushed oil prices higher and lifted perceived inflation risks. Defence and energy stocks gained amid the US Iran standoff, while mining and banking shares weighed on the index. Centrica dropped over 4% after reporting no new share buyback and unchanged guidance. Rio Tinto fell 4% after reporting flat full year profit, leading miners lower. Anglo American and Antofagasta fell 3% each.Banks also declined with Barclays down 4% and others including Lloyds Banking Group, NatWest and HSBC Holdings all lower. On the other hand, energy names Shell and BP rose, alongside BAT, Relx and BAE Systems. Mondi rose nearly 1.6% despite lower 2025 profit and expected 2026 maintenance impacts.

FTSE 100 Falls from Record

US natural gas futures held around $3.0 per MMBtu, near a four-month low, as rising output and smaller than normal storage withdrawals eased tightness in the market. Average production in the Lower 48 states climbed to 108.7 billion cubic feet per day so far in February, up from 106.3 bcfd in January, approaching December’s record of 109.7 bcfd. The US Energy Information Administration reported a 144 bcf withdrawal for the week ended February 13, slightly below the five-year average and last year’s 182 bcf. Stocks remain about 6% below normal but analysts expect most of the deficit to be erased by early March as mild weather keeps heating demand low. Average flows to eight US LNG export plants rose to 18.6 bcfd in February, near December’s record, while forecasts show temperatures will stay mostly warmer than normal through early March.

US Natgas Prices Hold at Around 4-Month Low

Silver climbed past $78.5 per ounce, extending its advance as investors reassessed the US policy outlook and navigated a backdrop of resilient economic data and intensifying geopolitical risks. Minutes from the Federal Reserve’s January meeting indicated that most officials see inflation risks as skewed to the upside, with several favoring a prolonged period of restrictive policy and some even acknowledging that further tightening could be warranted if price pressures fail to ease, prompting markets to scale back expectations for multiple rate cuts this year while still pricing in limited easing before year end. Firmer labour market signals, including a drop in initial jobless claims to 206,000, reinforced the view that underlying demand remains steady. At the same time, renewed tensions in the Middle East, alongside stalled diplomatic efforts between Russia and Ukraine, have supported safe haven allocations across precious metals.

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