Markets Today: Europe gains on financials, Gold & Oil Remain Flat, Japan GDP underwhelms as FTSE 100 edges higher

Stock markets in Asia were quiet at the start of the week. This happened because markets in China, South Korea, and Taiwan were closed for the Lunar New Year holiday, which meant there was very little trading activity.

In Japan, the Nikkei rose slightly by 0.2%. This followed a very strong previous week where prices had jumped by 5%.

However, some new economic data from Japan was disappointing, which slowed down the market's recent fast growth.

Other markets also saw big gains recently.

Last week, technology stocks in South Korea went up by 8.2%, and the market in Taiwan grew by nearly 6%. While stock prices generally stayed steady or rose a little on Monday, the prices of precious metals like gold started to drop.

Most Read: Chart alert: Nikkei 225 bullish acceleration intact towards 60,000 in the first step

At the end of 2025, Japan’s economy grew slightly by 0.1%, which was better than the decline it saw earlier in the year but lower than the 0.4% experts had expected.

While businesses started spending more on equipment and projects again, regular citizens did not. People in Japan spent very little extra money because the high cost of living, especially expensive food prices, made them cautious.

The government also kept its spending low, and international trade didn't help the economy grow since both exports and imports fell.

On the bright side, the negative impact of 15% tariffs from the United States seems to be fading, though Japan is still dealing with difficult political relations with China.

Looking ahead, the Japanese government plans to use its recent election win as a reason to start spending more public money to boost the economy.

On Monday, European stock markets rose slightly, led by the STOXX 600 index which increased by 0.3%.

Banks and insurance companies performed especially well, helping Spain’s stock market take the lead in the region. Investors are currently waiting for new data on industrial production and several company profit reports coming later this week from major firms like Airbus and Orange.

These reports will help people understand how healthy European businesses really are right now.

The market has been on a bit of a roller coaster recently. In late January, investors were worried that new Artificial Intelligence (AI) tools might hurt the profits of traditional companies, causing stock prices to swing up and down.

However, European companies actually reported better profits than people expected, even with the challenge of high US tariffs. This resilience helped the market hit a record high last week, marking three straight weeks of growth.

Later today, a new report is expected to show that industrial production in Europe grew by 1.3% in December. While this is slower than the growth seen the month before, investors are still hopeful.

Many believe that government spending and support programs are starting to help the industrial sector recover and grow again.

On the FX front, the Japanese yen dropped slightly after a massive 3% surge last week. This small decline happened because new economic data showed that Japan’s economy grew much slower than expected, making it less likely that the Bank of Japan will raise interest rates soon.

Meanwhile, the US dollar remained steady as investors processed recent reports showing that inflation is cooling down, which supports the idea that the Federal Reserve might cut interest rates later this year.

Trading was very quiet across the board because major markets in the U.S., China, Taiwan, and South Korea were closed for public holidays. With fewer people trading, the euro and the British pound didn't move much against the dollar.

In other currency news, the Australian dollar rose slightly, staying near its highest level in three years due to expectations that Australia might actually raise interest rates soon.

On the other hand, the New Zealand dollar weakened a bit as investors prepared for a central bank meeting on Wednesday, where experts widely expect interest rates in that country to stay exactly where they are.

Currency Power Balance

The price of gold dropped in Asian trade because there was less trading than usual, as markets in both the United States and China were closed for holidays.

Market participants also decided to sell their gold to lock in profits after prices had jumped by 2.5% during the previous session.

By early morning, the price for immediate delivery fell nearly 1% to around $4,997 per ounce, while gold promised for future delivery in April also saw a price decrease.

Other precious metals followed a similar downward trend. Silver prices fell by 0.8% after a much larger drop earlier in the day, reversing some of the big gains it made last Friday.

Platinum also became slightly cheaper, while palladium prices stayed mostly the same.

Meanwhile, markets are keeping a close eye on rising political tensions. US military officials reported they are preparing for a potential weeks-long operation against Iran if the President orders an attack.

This situation could lead to a much more serious conflict than in the past, which often causes uncertainty in global markets and leads to a surge in haven demand. With that in mind, such a move could push commodity prices higher if it comes to fruition.

Oil prices barely moved on Monday as markets waited to see what would happen with upcoming meetings between the United States and Iran. These talks are meant to lower tensions between the two countries, which could affect how much oil is available globally.

At the same time, the market is preparing for OPEC+ to potentially increase the amount of oil they supply to the world starting in April.

Because of these conflicting factors, the price of Brent crude stayed nearly flat at about $67.72 per barrel. Similarly, US oil (WTI) was priced at $62.86 per barrel.

Trading was very quiet because it was a public holiday in the United States, meaning there was no official closing price for US oil on Monday.

Read More:

Supreme Court tariff decision and key tests ahead – Markets Weekly Outlook

Breaking News: UK GDP underwhelms with 0.1% growth in Q4, FTSE 100 slips & GBP/USD advances

EUR/USD's Next Move: Hot inflation to 1.1785 or cooling jobs to 1.2000?

The day ahead is a quiet one in terms of EU and UK data with Euro Area industrial production the highlight.

Over the past two weeks, the U.S. dollar has struggled to recover its strength, even though the American economy is showing signs of improvement. A major sell-off in mid-January, combined with similar market trends from the summer of 2025, has left investors feeling cautious about the currency.

This lack of confidence was clear last week: even though the official jobs report was very strong, the dollar only saw a small, temporary price increase before stalling again.

Looking at the week ahead, several economic reports will be released, though they may not be powerful enough to change the market's mind. Investors will check the ADP jobs report on Tuesday, but the biggest focus will be on Friday’s data for December inflation (Core PCE) and overall economic growth (GDP).

Since the Federal Reserve pays close attention to the Core PCE as its favorite inflation measure, a predicted increase of 0.3% could make the central bank less likely to cut interest rates soon.

While there is a chance the dollar could rise this week if the economic growth numbers are solid and the Federal Reserve’s meeting minutes sound firm, I am not fully convinced a major recovery is coming yet. Because today is a US public holiday, trading will likely be quiet with fewer people buying and selling.

From a technical perspective, the FTSE 100 index continues to hold comfortably above the 100-day MA.

Having printed fresh highs last week around the 10550 handle the index has seen a notable pullback before finding support at 10387.

For now though, bulls remain firmly in control even though a pullback to support around the 10440 mark cannot be ruled out.

Only a four-hour candle close below the higher low swing point at 10387 would lead to a change in structure and could lead me to reevaluate my outlook.

Immediate support rests at 10440 before the swing low at 10387 comes into focus.

Resistance to the upside at 10528 needs to be cleared if bulls are to make a run for the daily and all-time highs at 10550.

FTSE 100 Index Daily Chart, February 16, 2026

Follow Zain on Twitter/X for Additional Market News and Insights @zvawda