US equity markets commenced the trading week on a positive note, registering modest gains during Monday's opening session. Investors shifted their attention toward a packed corporate earnings calendar and the upcoming monetary policy meeting of the US Federal Reserve, scheduled for later this week. In a remarkable development, the precious metals market witnessed a historic surge, with gold prices breaching the psychological barrier of $5,000 per ounce for the very first time.
Market Indices Show Early Strength
The benchmark S&P 500 index advanced by 0.4% in early trading, attempting to recover from its second consecutive weekly decline. The Dow Jones Industrial Average demonstrated similar resilience, climbing 184 points, which also translated to a gain of 0.4%. The technology-heavy Nasdaq composite index followed suit, posting a 0.3% increase by mid-morning trading hours, reflecting a cautiously optimistic start to the week.
Sector-Specific Movements and Headwinds
Not all sectors participated in the early rally. The airline industry faced headwinds, with stocks trading slightly lower. This downturn was primarily attributed to operational disruptions, as thousands of flights across the United States were cancelled. A massive winter storm, stretching from the Rocky Mountains to the East Coast, was responsible for the widespread travel chaos. Shares of major carriers like Delta Air Lines and United Airlines each declined by approximately 1.2% in response to the logistical challenges.
In contrast, USA Rare Earth, a critical minerals mining company based in Oklahoma, experienced a dramatic surge. Its stock price jumped an impressive 25% following news of a significant boost from a US government investment. This move underscores the continued policy support and strategic focus on strengthening domestic supply chains for essential materials.
Safe-Haven Assets and Commodities Rally
Amidst ongoing geopolitical uncertainty, demand for traditional safe-haven assets intensified, driving precious metals sharply higher. Gold prices climbed 2% to decisively cross the $5,000-per-ounce milestone, marking an unprecedented high. Silver prices witnessed an even more substantial rally, surging 8.6% to reach around $110 per ounce, extending gains from previous sessions.
The energy sector also saw activity, with natural gas futures rising another 2.2%. This increase was fueled by forecasts of colder weather following the recent winter storm, which dumped heavy snowfall across several regions and caused disruptions to power supplies, thereby elevating demand expectations.
Central Bank Policy and Corporate Earnings in the Spotlight
Market participants are keenly awaiting the outcome of the US Federal Reserve's policy meeting later this week, where officials will decide on the path for interest rates. The prevailing expectation among most analysts and investors is that policymakers will opt to keep rates unchanged. This comes after the Fed implemented rate cuts during the final three meetings of 2025, suggesting a potential pause to assess economic conditions.
Corporate earnings will remain a central focus for investors throughout the week. A slew of major companies are scheduled to report their financial results, including United Airlines, Boeing, General Motors, Meta, Microsoft, and Apple. Analysts will be scrutinizing these reports, particularly to assess the potential impact of recent US tariff policies on corporate profitability and future guidance.
Global Market Cues Present a Mixed Picture
International market signals were divergent as the week began. European equity markets managed to edge higher, showing tentative strength. However, Asian markets displayed weakness during their trading sessions. Japan's Nikkei 225 index fell notably by 1.8%. This decline coincided with a rebound in the Japanese yen against the US dollar, fueled by market speculation about possible government intervention to support the currency. The US dollar slipped to 153.83 yen from 155.01 yen, a significant move after trading near 158 yen just last week.
