Markets Today: Tech wobbles, Yen resurgence, Gold recovers ahead of key US CPI data. FTSE 100 holds above support

• Asian and European markets were weighed down by a global tech sell-off
• The Japanese yen was on track for its strongest weekly performance in nearly 15 months
• Gold recovered from a low ahead of US CPI data, while oil prices continued their downward trend for a second consecutive week
• Swiss annual inflation held steady at 0.1% in January, and consensus forecasts for the upcoming US CPI report suggest a "clean" 0.3% month-on-month rise for headline and core figures.

Asian markets pulled back from record peaks on Friday as concerns over thinning profit margins in the technology industry weighed on major players like Apple. This tech-driven retreat prompted investors to pivot toward safe-haven bonds.

The downward trend originated on Wall Street, where the Nasdaq Composite fell 2% following a disappointing quarterly report from Cisco Systems. Cisco saw its shares plunge 12% erasing roughly $40 billion in market value after rising memory chip costs caused its adjusted gross margins to miss analyst expectations.

The volatility quickly spread to other industry leaders, notably Apple, which experienced a 5% decline. This marked the stock's sharpest one-day drop since April of the previous year, a period defined by market anxiety over President Trump’s "Liberation Day" tariffs.

Consequently, MSCI’s broadest index of Asia-Pacific shares outside Japan dropped 1.1% on Friday, though it maintained a 3.7% gain for the week.

Similarly, Japan’s Nikkei shed 1.3% despite ending the week up nearly 5%.

The slump extended into Greater China, with Chinese blue chips falling 0.9% and Hong Kong’s Hang Seng index sliding 2.1%.

Amidst the broader market turbulence, a report from the Financial Times suggested a potential shift in trade policy. Citing internal sources, the publication noted that President Trump is considering a reduction in certain steel and aluminum tariffs, offering a potential counterbalance to the prevailing tech-sector gloom.

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Switzerland's annual inflation rate held steady in January at 0.1%, matching both December's figure and consensus forecasts.

The data revealed a continued deflationary trend across several sectors, with prices for food and non-alcoholic beverages, clothing, footwear, and household services all remaining in negative territory compared to the previous year. Transport costs saw the most significant contraction, dropping 2% year-on-year.

Meanwhile, price increases moderated for alcoholic beverages and tobacco, while costs for education remained flat and the information and communication sector saw its growth stall entirely at 0%.

Offsetting these declines were accelerating costs in other categories, most notably housing and energy, which rose to 0.8% from a previous 0.4%.

Price growth also gained momentum in the recreation, culture, and miscellaneous goods sectors.

Despite these internal shifts, core inflation which strips out the volatile effects of unprocessed food and energy remained consistent at 0.5% for the second consecutive month.

On a month-to-month basis, the broader Consumer Price Index edged down 0.1%, a slight dip following a stagnant reading in December.

European stock markets headed toward a tentative opening this Friday as a global sell-off in the technology sector raised fresh doubts about the long-term viability of massive AI investments.

These concerns regarding AI-driven disruption extended beyond tech, creating a drag on the logistics, financial, and commercial real estate sectors. Amidst this cautious atmosphere, investors turned their attention to a heavy macroeconomic calendar, which included German wholesale prices, Spanish inflation figures, and a suite of Eurozone data covering GDP, employment, and trade.

Despite the underlying tension, premarket futures for the Euro Stoxx 50 and Stoxx 600 remained relatively flat, suggesting a neutral start for the broader indices.

The session was further complicated by a wave of corporate earnings, most notably from French beauty giant L'Oreal, which saw its shares tumble approximately 6% in early trading. This decline, marking the company's worst performance since at least October, followed fourth-quarter sales of 11.3 billion euros (roughly $13.4 billion) that narrowly missed analyst targets.

The shortfall was primarily attributed to a stagnant recovery in North Asia, the global beauty industry’s second-largest market, where growth failed to meet expectations.

Adding to the pressure, Deutsche Bank Research suggested that L'Oreal’s earnings growth is likely to decelerate in the immediate future.

On the FX front, the Japanese yen was on track for its strongest weekly performance in nearly 15 months on Friday, capping a period of steady gains.

The currency’s resurgence became the primary focal point of the foreign exchange market, defying early predictions that a landslide victory for Sanae Takaichi would trigger a deepening sell-off. Instead, the clear electoral mandate appears to have eased concerns regarding fiscal stability and political gridlock, encouraging investors to unwind "short" bets against the yen.

By Friday, the yen was trading at 153.08 per dollar, and while it dipped slightly in the final session, it remained poised for a 2.7% weekly advance, its most significant climb since November 2024.

This strength was mirrored across other major pairs, with the yen set for a 2.3% weekly jump against the euro and a 2.7% rise against the British pound.

In the broader currency market, the euro and sterling saw modest declines, with the euro trading at $1.1863 and the pound easing to $1.3613.

Meanwhile, the Australian dollar faced a 0.3% daily dip to $0.7072, though it remained on course for a weekly gain of nearly 0.9%. The Aussie’s recent resilience has been supported by a hawkish stance from the Reserve Bank of Australia, which recently implemented a rate hike to combat persistent inflation.

Overall, the US dollar index stood slightly higher at 97.01 on Friday but was still tracking toward a 0.7% loss for the week as global investors pivoted toward the rebounding yen and other high-yielding assets.

Currency Power Balance

Gold prices edged higher on Friday, mounting a recovery from a nearly one-week low as the market shifted its focus to impending US inflation data.

This rebound follows a volatile week where a string of robust labor market reports pressured the Federal Reserve to reconsider the timing of potential interest rate cuts, cooling the enthusiasm for non-yielding assets.

Spot gold rose 0.6% to reach $4,949.99 per ounce, while US gold futures for April delivery climbed 0.4% to $4,968.0. Despite this intraday bounce, the metal remains down slightly for the week after a dramatic 3% plunge on Thursday, which saw prices crash through the psychological $5,000 support level amid a broader liquidation triggered by an equities rout.

The recovery was mirrored across the precious metals complex, with silver leading the charge by gaining 1.5% to trade at $76.31 per ounce. While silver managed to claw back some of the staggering 11% loss it suffered during Thursday’s sell-off, it is still on track to finish the week over 2% lower.

In the PGM sector, spot platinum increased by 0.9% to $2,018.44 per ounce and palladium surged 2.2% to $1,652.31.

However, both metals are likely to end the week in negative territory as investors remain cautious, balancing long-term central bank demand against the immediate impact of a stronger US dollar and shifting interest rate expectations.

Oil prices continued their downward trend on Friday, positioning benchmarks for a second consecutive weekly loss as geopolitical tensions in the Middle East showed signs of easing.

Market anxiety regarding a potential conflict between the US and Iran which could have severely disrupted global supplies began to dissipate, pulling prices lower.

Brent crude futures edged down to $67.40 per barrel, following a significant 2.7% drop in the previous session, while US West Texas Intermediate (WTI) fell to $62.71.

For the week, Brent is on track for a 0.8% decline, with WTI trailing slightly further behind at a 1.1% loss.

In addition to shifting geopolitical risks, the market is adjusting to a significant influx of supply from South America. US Secretary of Energy Chris Wright reported on Thursday that American-controlled oil sales from Venezuela have already exceeded $1 billion since the capture of President Nicolás Maduro in January. Wright projected that these operations are set to generate an additional $5 billion over the coming months as the US rehabilitates Venezuela's energy infrastructure.

This surge in anticipated supply, combined with a recent International Energy Agency report forecasting weaker global demand, has created a bearish environment for crude as the trading week concludes.

Read More:

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• Chart alert: Gold rally faces risk of exhaustion below $5,170

The day ahead is a quiet one in terms of EU and UK data with all high impact data already released.

The US session looks set to be a bumpy one after yesterday's selloff with inflation data on deck.

Today’s US inflation report is expected to have a more muted impact on the market compared to Wednesday's payroll data, as the Federal Reserve’s current stance prioritizes labor market health over price stability.

Consensus forecasts suggest a "clean" January print with headline and core CPI both rising 0.3% month-on-month and 2.5% annually. Such a result would likely validate the market’s recent hawkish shift in Fed expectations, reinforcing the view that the US dollar is currently undervalued in the short term.

While this technical undervaluation suggests a potential upside for the greenback, recent price action indicates that investors are still eager to sell into any dollar rallies, making a sustained recovery difficult.

However, the dollar has found some support as a safe-haven asset during the recent volatility in the tech sector. This restoration of its protective status, combined with a patient Federal Reserve, suggests the dollar may remain resilient even if major rallies are capped by persistent bearish sentiment.

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

Having printed fresh highs yesterday morning around the 10550 handle the index has seen a notable pullback.

For now though, bulls remain firmly in control.

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 10460 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 Four-Hour Chart, February 13, 2026

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