On January 15, a significant turning point was reached in the Middle East as Israel and the Palestinian Islamic Resistance Movement (Hamas) reached an agreement on a ceasefire and the exchange of detainees in the Gaza Strip. Qatari Prime Minister and Foreign Minister Mohammed announced in Doha that the agreement will take effect on January 19 and will be implemented in phases. The agreement includes a ceasefire, exchange of detainees, gradual withdrawal of Israeli forces from Gaza, return of displaced persons to their homes, and increased humanitarian aid. Qatar, Egypt, and the United States will act as guarantors of the agreement to ensure smooth execution at all stages.
The Israel Defense Forces stated that they are preparing to receive Israeli detainees. Meanwhile, Hamas urged people to exercise restraint before the agreement takes effect and to get specific ceasefire timing through official channels. Although the agreement has been reached, the office of Israeli Prime Minister Netanyahu disclosed that some details still need to be finalized.
News of the ceasefire agreement caused significant fluctuations in global markets. Prices of gold, silver, and crude oil all rose. At the close, WTI crude oil futures rose 3.28% to $80.04 per barrel, Brent crude oil futures rose 2.64% to $82.03 per barrel, spot gold increased 0.64% to $2694.55 per ounce, and spot silver climbed 2.32% to $30.5840 per ounce.
Meanwhile, data released by the U.S. Bureau of Labor Statistics for December 2024 showed that CPI rose by 2.9% year-on-year, matching market expectations; core CPI rose by 3.2% year-on-year, slightly below the market expectation of 3.3%. The super-core CPI excluding housing rose by 0.28% month-on-month, alleviating some inflation concerns. Influenced by the CPI data, expectations of an early interest rate cut by the Federal Reserve increased, with interest rate futures indicating a higher possibility of two rate cuts in 2025. The CME "FedWatch" tool shows a 97.3% probability of maintaining rates unchanged in January.
The CPI data propelled a broad rebound in U.S. stocks. The Dow Jones rose 1.65%, the S&P 500 Index climbed 1.8%, and the Nasdaq increased 2.45%. Technology stocks led the gains, with Tesla up over 3%, Amazon and Meta both rising over 2%, while Apple, Microsoft, and Google each increased over 1%. Cryptocurrency and robotics concept stocks performed robustly, with Richtech Robotics and Serve Robotics both rising over 12%, and MicroStrategy up over 3%. Among Chinese concept stocks, the Nasdaq Golden Dragon China Index rose 0.65%, and the 3x Long FTSE China ETF (YINN) climbed over 2%.
European stock markets strengthened simultaneously, with major indices all surging. The Euro Stoxx 50 Index, Germany's DAX Index, and Italy's FTSE MIB Index rose by more than 1%, while France's CAC 40 Index and the UK's FTSE 100 Index approached a 1% gain. In addition, OPEC predicts that global oil demand will further increase driven by India and China, providing room for recovery in oil production over the next two years.
Market analysts generally believe that the CPI data is in line with expectations, but core inflation is slightly below forecasts, anticipating that the Federal Reserve will remain inactive in its January policy meeting. Zhu Guanhua, an analyst at CICC Futures, stated that the recent surge in U.S. fiscal spending has boosted economic and inflation performance, but rising energy prices and sticky housing inflation could still pose future inflationary pressures. Yuan Tao, an analyst at Dongzheng Futures, added that the direct impact of tariff policy on inflation is limited, and the trend of slow inflation decline remains unchanged under a high-interest-rate environment.
Overall, the Middle East ceasefire agreement and U.S. CPI data jointly improved global market sentiment, leading to a general rebound in stock and commodity markets. However, experts warn that the fragility of the U.S. debt market and the risk of high premiums may exert long-term pressure on U.S. stocks, and the market still needs to be vigilant about potential volatility risks.
