Markets Today: French jobless rate hits four-year highs, gold steady, nikkei extends gains. US data now in focus

• Japan's Nikkei 225 surged to a new record high
• France's unemployment rate climbed to a four-year high of 7.9% in the final quarter of 2025
• The US dollar retreated to near a one-week low as the Japanese yen strengthened, while gold managed to sustain its position above the $5,000-per-ounce psychological threshold
• Market participants are focused on a series of critical economic indicators, including the weekly ADP employment report and the NFIB small business optimism index later today.

Asian markets surged on Tuesday as investors reacted positively to Prime Minister Sanae Takaichi’s landslide election victory.

Leading the regional gains, Japan’s Nikkei 225 climbed 2.3% to reach a new record high, marking its third straight day of increases. This momentum lifted the MSCI All-Country World Index to a fresh peak, while the broader MSCI Asia-Pacific index (excluding Japan) rose 0.6%.

Despite the equity rally, the Japanese yen also saw continued strength for a second consecutive session.

In Southeast Asia, Indonesian markets remained resilient, climbing 1% even after FTSE Russell delayed a planned index review. This stability comes despite recent warnings from MSCI regarding a potential downgrade to frontier status due to transparency concerns.

Meanwhile, the Japanese bond market saw significant activity as yields on long-term government bonds retreated for a fourth day. The 40-year JGB yield dropped 8.5 basis points to 3.73%, while the 30-year yield fell to 3.495%.

This cooling of bond yields which move inversely to prices follows a period of record highs triggered by Takaichi’s campaign promise to suspend food taxes for two years. With her Liberal Democratic Party now firmly in power after a decisive win, foreign demand has surged, stabilizing the debt market even as equity investors celebrate the political certainty.

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France's labor market showed signs of cooling in the final quarter of 2025, with the unemployment rate rising to 7.9%. This figure exceeded market expectations of 7.8% and reflects a steady climb from the 7.7% recorded in the third quarter, marking the highest jobless rate since late 2021.

The total number of unemployed individuals grew by 56,000 to reach 2.5 million. While this is a significant 0.6 percentage point increase year-over-year, the current rate remains 2.6 points lower than the peak levels seen in 2015.

The demographic breakdown reveals a stark contrast across age groups, with younger workers bearing the brunt of the downturn. Unemployment for those aged 15–24 surged by 2.4 points to reach 21.5%, while the 15–29 age bracket saw a 0.5-point increase to 16.0%.

Conversely, the rate for workers aged 25–49 saw a slight improvement, falling 0.2 points to 6.9%, and unemployment for those 50 and older remained steady at 5.1%. Gender-based data showed a narrowing gap as female unemployment dipped slightly to 7.6%, while male unemployment rose to 8.1%.

Despite the rise in joblessness, other indicators suggest the French labor market remains highly active. The overall employment rate for the 15–64 age group held firm at 69.4%, hovering near historic highs.

While full-time employment remained stable at 57.5%, part-time roles saw a modest increase to 11.8%. Most notably, the total activity rate measuring both those employed and those actively seeking work reached an all-time record of 75.4%, suggesting that more people than ever are participating in the workforce.

European equity markets were positioned for a flat opening on Tuesday as a period of significant growth gave way to investor hesitation.

While the previous two sessions saw strong gains fueled by positive corporate earnings and a jump in Eurozone investor sentiment for February, market participants have shifted their focus to upcoming US economic reports. These data points are expected to be critical in shaping future Federal Reserve interest rate decisions.

Locally, the day’s agenda includes the release of French labor statistics and industrial production figures from Turkey, which will provide further insight into regional economic health.

The corporate landscape also contributed to the morning's cautious atmosphere. Standard Chartered made headlines with the unexpected departure of CFO Diego De Giorgi, who stepped down to join asset manager Apollo; Peter Burrill has been appointed as his interim successor.

Meanwhile, the luxury sector remains under pressure as Kering revealed a continued slump in sales for its flagship brand, Gucci, highlighting ongoing struggles in the high-end retail market. Reflecting this collective uncertainty, futures for both the Euro Stoxx 50 and the Stoxx 600 showed virtually no movement in premarket trading.

On the FX front, the US dollar retreated on Tuesday as traders braced for a wave of new economic data, including retail sales and labor figures.

The Japanese yen spearheaded the move, strengthening to 155.24 per dollar following an 0.8% jump on Monday. This recovery was bolstered by verbal warnings from Japanese officials and a renewed focus on fiscal sustainability under Prime Minister Sanae Takaichi, helping the currency distance itself from recent record lows against the euro and the Swiss franc.

Sentiment toward the dollar was further dampened by reports that Chinese regulators have encouraged domestic banks to reduce their holdings of US Treasuries, contributing to the "sell America" theme currently circulating in global markets.

Meanwhile, the euro maintained its strength at $1.19125 after its own significant rally on Monday, leaving the US Dollar Index (DXY) languishing near a one-week low of 96.79.

In China, the yuan surged past the 6.91 per dollar mark for the first time since mid-2023, bringing its year-to-date gains above 1% amid expectations of continued appreciation.

Other commodity-linked currencies saw more modest movement; the Australian dollar dipped 0.2% to $0.7079, pulling back slightly from a three-year peak, while the New Zealand dollar eased 0.3% to settle at $0.60395.

Currency Power Balance

Gold prices edged lower on Tuesday but managed to sustain their position above the significant $5,000-per-ounce psychological threshold. This retreat follows a volatile period where the metal surged 2% on Monday, briefly recovering after a dramatic correction from its late-January record of nearly $5,595.

The broader precious metals complex mirrored this cautious sentiment, with silver experiencing even sharper fluctuations. After a nearly 7% rally in the previous session, spot silver fell 2.1% to approximately $81.63 per ounce on Tuesday.

Like gold, silver is currently stabilizing after a historic selloff that saw it plunge from a peak of over $121 on January 29. Market analysts note that while speculative profit-taking is driving these short-term dips, long-term support remains firm due to continued central bank accumulation led by the People's Bank of China and persistent geopolitical uncertainties.

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The day ahead is a quiet one in terms of EU and UK data

The US dollar faced continued downward pressure on Tuesday, as a pervasive sense of bearishness took hold of the market. This negative sentiment is clearly reflected in the FX options markets, where demand for dollar "puts", bets that the currency will fall, remains high across short, medium, and long-term tenors.

Further weighing on the greenback were recent comments from Federal Reserve Governor Stephen Miran, who suggested that the dollar’s current weakness is not a "first order" concern for US inflation. His remarks have bolstered the market's belief that Washington is currently maintaining a stance of "benign neglect," appearing comfortable with a softer currency as long as it doesn't trigger a more severe inflationary spike.

Looking ahead to the rest of the day, investors are focused on a series of critical economic indicators, including the weekly ADP employment report and the NFIB small business optimism index. Market attention will also be fixed on the December retail sales release, where the "control group" category is projected to show a healthy 0.4% month-on-month increase.

Such a result would support the narrative that the American consumer remains resilient, a trend that could be further reinforced in March when households begin receiving their annual tax rebate checks.

From a technical perspective, The FTSE 100 index is on the decline this morning and is approaching an area of support at 10330.

A break below this support area can bring the 100-day MA into play resting at 10247.

If this level is able to hold then a bounce may materialize with immediate resistance at the 10415 handle.

The one concern is that the RSI period-14 has crossed below the 50 level which hints at a shift toward bearish momentum.

FTSE 100 Index Daily Chart, February 9, 2026

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