Global Highlights for This Week: Trump Officially Begins His Second Term, Davos World Economic Forum to Be Held

All three major US stock indices recorded gains last week. The Dow Jones Industrial Average and the S&P 500 Index rose by 3.69% and 2.91% respectively, achieving the largest weekly gains since the US presidential election week in November last year.

The Nasdaq Composite Index rose by 2.45% last week, posting the best weekly performance since early December.

Two inflation data released last week - the US Producer Price Index (PPI) and Consumer Price Index (CPI) for December-both came in lower than market expectations, leading to an increase in investors' bets on the number of interest rate cuts by the Federal Reserve this year.

Previously, due to the uncertainties brought about by the US government transition and the continued strong employment data, the market had once expected only one interest rate cut this year, and pessimists were even speculating about the possibility of resuming interest rate hikes.

This week's macroeconomic data is relatively uneventful. The biggest focus is the inauguration ceremony of the US President-elect Trump this Monday. Trump is expected to issue a series of executive orders on that day, which may have a significant impact on the market.

Patrick Munnelly, a market strategist at Tickmill Group, said: "The market is waiting for Trump's inauguration ceremony and the possible large number of executive orders."

Monday is a public holiday in the US, but it is widely expected that the entire financial market will experience fluctuations as investors digest the impact of the policy announcements. The US stock market will be closed for one day this Monday due to Martin Luther King Jr. Day.

Trump also plans to deliver an online speech at the Davos World Economic Forum later last week. This year's World Economic Forum Annual Meeting 2025 will be held from January 20th to 24th.

The Bank of Japan will announce its latest interest rate decision this Friday, and the bank's governor Kazuo Ueda will hold a monetary policy press conference. Kazuo Ueda said on Wednesday last week that if the economic and price conditions continue to improve, the Bank of Japan will raise interest rates and adjust the monetary support.

The International Monetary Fund (IMF) predicted on Friday that the Bank of Japan is expected to raise interest rates twice in 2025 and twice again in 2026.

The US stock market's Q4 earnings season has started last week, and large banks generally delivered strong quarterly reports, which to some extent boosted market sentiment.

This week, more companies will release their Q4 earnings. 3M and New Oriental will announce their earnings before the market opens on Tuesday.

In terms of the most watched technology stocks, Netflix will take the lead. The company is scheduled to announce its earnings after the US stock market closes on Tuesday.

Overview of Important Overseas Economic Events This Week :

Monday: Germany's December PPI data, Davos World Economic Forum Annual Meeting to be held (until January 24th), Trump to be sworn in as the new US President

Tuesday: UK's December unemployment data, Germany/Eurozone's January ZEW Economic Sentiment Index, Canada's December CPI data

Wednesday: US December Conference Board Leading Indicators, European Central Bank President Christine Lagarde to give a speech

Thursday: Eurozone's January Consumer Confidence Index Preliminary Value, South Korea's Q4 GDP Preliminary Value

Friday: France/Germany/Eurozone's January Manufacturing/Services/Composite PMI, US January S&P Global Manufacturing/Services/Composite PMI Preliminary Value, US January University of Michigan Consumer Sentiment Index Final Value, Bank of Japan to announce interest rate decision and economic outlook report, Bank of Japan Governor Kazuo Ueda to hold a monetary policy press conference