Dow Reaches Fresh Records Despite Geopolitical Caution, Rising Yields: Jan. 6, 2026

A morning surge in stocks that propelled the S&P 500 close to touching fresh records was tempered about an hour after the opening bell as sellers came in and blocked the advance. But the Dow Jones Industrial Average marked a new peak in concentrated fashion, as a 4% climb in Amazon shares bolstered the benchmark. Overall, though, worries that geopolitical tensions could ignite volatility and trigger a reversal in equity appreciation motivated some investors to take some profits with equities near all-time highs in the other indices. Meanwhile, rising interest rates were another headwind, with Treasuries surrendering yesterday’s progress that was driven by a weaker-than-expected ISM-manufacturing print and lighter inflation expectations. Furthermore, an outlook of softening cost pressures is being supported by lessening probability of an energy price spike following US military operations in Caracas. With Washington exerting a heavy amount of influence in the oil-rich nation, the chances of scarce supplies have dropped meaningfully. Jumping yields are generating gains for the greenback on a day featuring a lack of economic data. In commodities, precious metals are surging, with silver and gold up 5.8% and 1% on safe-haven demand. Copper, furthermore, is up 1.3% on projections of limited available quantities, while crude oil, natural gas and lumber descend. Elsewhere, forecast contracts and Ethereum are catching bids even as Bitcoin takes losses.

Investors Welcome Incoming Econ Data 

Investors are welcoming incoming economic data to justify positioning into 2026 and we have an eventful schedule tomorrow. The most impactful publication will be ADP’s monthly jobs report, as an uptick in unemployment is one of the significant risks in this new year alongside of heavy investments in AI potentially failing to deliver blockbuster returns. Participants will also closely watch job openings and ISM-services for additional labor market information as well details concerning the momentum of consumer demand. Fixed income and equity assets are likely to benefit from healthy numbers that are near expectations but not too strong, because the 10-year is on the brink of rising to its highest level since early September. Ultimately, I’m a Treasury bull at this juncture, considering fiscal improvements and softening inflation that together should counter a reacceleration in growth and bring duration about 25 basis points lower from current levels. Still, big beats beat on ADP and JOLTS could drive 10s to 4.25% and 30s to 4.90% while weighing on Fed easing enthusiasm. Meaningful misses, meanwhile, could raise slowdown concerns and weaken stock buying as traders opt for government debt instruments instead.

International Roundup

Singapore Business Expansion Eases

Business activity in Singapore slowed in December with the S&P Global PMI falling from 55.4 to 54.1 but stayed significantly above the contraction-expansion threshold of 50. The December reading was the lowest in four months. Nevertheless, it was the eleventh consecutive month of strengthening business conditions.

Growth of both new orders and output weakened slightly, and firms focused more on backlogs as a result. A slightly smaller workforce resulting from resignations and fewer part-time employees also contributed to reduced production. Input prices continued to rise due to higher expenses for materials, operations and labor, but the pressure softened slightly. Companies responded by increasing their gate prices, which helped support margins. In another matter, confidence improved with businesses feeling optimistic about new product launches, higher output and growth plans.

Hong Kong Firms Report Slower Growth

Hong Kong businesses reported a fifth consecutive month of improving conditions during December, but the pace of the rise in activity slowed, according to the S&P Global Hong Kong SAR PMI. The gauge fell from 52.9 in November to 51.9 last month. It was the fifth month of strengthening conditions as sales expanded at roughly the same pace as in recent months with loftier confidence among buyers supporting the trend. In this regard, revenues were supported by stronger orders from mainland China and other international markets. The ongoing strength contributed to growing work backlogs and larger volumes of input purchases, albeit at a slightly slower rate than during November. December was the first time backlogs expanded in 2025. Input costs, however, picked up with higher raw material costs and separately, labor outlays climbed at the fastest rate since June 2024. Businesses were able to pass the costs onto customers in the form of higher gate prices. Firms ended the year with lingering concerns about the global economy and the impacts of tariffs, but the degree of negative sentiment was the weakest in roughly 30 months.