Global Highlights for This Week: U.S. Q4 Earnings Season Kicks Off, CPI and Geopolitical Tensions in Focus
U.S. stocks started 2026 with strong momentum, but investors could face the first real test of the year this week: Q4 earnings season officially begins, December inflation data is due, and geopolitical uncertainty continues to rise.
The S&P 500 has climbed nearly 2% so far in January, after posting double-digit gains for the third straight year in 2025. Despite mixed Friday’s nonfarm payrolls, U.S. stocks closed sharply higher, with traders betting on continued Fed rate cuts.
However, recent market strength contrasts sharply with rising geopolitical tensions. After the U.S. military operation that detained Venezuelan leader Maduro, the Trump administration signaled it “must take Greenland,” not ruling out military options.
Investors see robust corporate earnings, gradually easing monetary policy, and upcoming fiscal stimulus as the core pillars supporting this bull market.
State Street Global Advisors strategist Michael Arone said: “Overall, the foundation for this year remains solid. But as January unfolds, the market may be underestimating some upcoming events that could significantly increase volatility. The current mood feels a bit too calm.”
While geopolitical developments have boosted safe-haven assets like gold, equities have largely remained “immune” to related uncertainty. Wall Street’s fear gauge VIX hovered near 2025 lows on Friday.
This week, major banks kick off Q4 earnings, with profit growth as a core bull thesis. LSEG data shows analysts expect S&P 500 companies to grow earnings ~13% in 2025, with 2026 growth projected above 15%.
JPMorgan Chase reports Tuesday, followed by Citigroup, Bank of America, and Goldman Sachs. Analysts forecast ~7% Q4 earnings growth for financials.
Natixis Investment Managers portfolio manager Jack Janasiewicz said he’ll focus on consumer health indicators in bank reports, like credit card delinquency rates, since consumption drives over two-thirds of U.S. economic activity. “Banks provide very important signals—they’re on the front lines of economic activity.”
Due to last year’s 43-day government shutdown delaying or canceling key data, investors have had limited visibility into the U.S. economy. As releases return to normal, sensitivity to fresh numbers rises.
Tuesday’s December CPI becomes especially critical—the last major inflation read before the Fed’s late-January meeting. It will help gauge timing and magnitude of future cuts.
Wednesday brings November PPI for upstream inflation clues and November retail sales for consumer spending resilience.
Geopolitically, Iran remains in focus. Supreme Leader Khamenei said recent unrest is a U.S. plot, and Iran will not back down before U.S.-Israel-backed thugs.
Iran’s military stated Saturday it will monitor regional threats and protect national interests, strategic assets, and public facilities against enemy plots.
Reports say Trump administration officials held preliminary discussions on military strikes against Iran if necessary. Discussions are routine planning; no indication of imminent action. Options include large-scale airstrikes on multiple military targets.
Key Events this Week
Monday (January 12): Switzerland December consumer confidence, Eurozone January Sentix investor confidence, Japan markets closed.
Tuesday (January 13): U.S. 10-year Treasury auction (to Jan 12), Japan November trade balance, U.S. December NFIB small business confidence, U.S. December unadjusted CPI YoY, adjusted CPI MoM, core adjusted CPI MoM, October new home sales annualized, New York Fed President Williams speaks, St. Louis Fed President Musalem speaks.
Wednesday (January 14): U.S. weekly API crude inventories (to Jan 9), November retail sales MoM, November PPI YoY, Q3 current account, December existing home sales annualized, weekly EIA crude inventories (to Jan 9), China December trade balance, Philadelphia Fed President Harker on economic outlook, Fed Governor Mester speaks in Athens, OPEC monthly oil market report.
Thursday (January 15): UK November three-month GDP MoM, November adjusted goods trade balance, Germany full-year 2025 GDP growth, Eurozone November adjusted trade balance, weekly initial jobless claims (to Jan 10), weekly EIA natural gas inventories (to Jan 9), Bank of Korea rate decision, Fed Beige Book, Minneapolis Fed President Kashkari speaks, New York Fed President Williams opens an event.
Friday (January 16): Germany December CPI MoM final, U.S. December industrial production MoM, January NAHB housing market index.