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

• Discover our Weekly Market Outlook, exploring themes and events that forged financial flows throughout the week.
• After a volatile stretch, traders buckle for a heavy-slate of US data.
• Get ready for next week's action by exploring upcoming events across global Markets.

Markets are subject to particular waves of volatility in the past weeks, as years of upward trajectories and the recent acceleration are now questioning extreme valuations.

The culprit? Artificial Intelligence.

What had been a boon for Stocks is now coming back to bite the investor where it hurts, with investors realising that AI won't just be an upside-only catalyst.

Productivity gains by AI are now turning into fears of destruction for many firms, industries, and their components – Look at Tech and Softwares, straight-up bleeding since October.

High investments and Capital Expenditures that were seen as only positive are now being targeted by profit-takers and short-sellers, as investors question how long it will take to materialize into profits.

This comes amid times when OpenAI, the founder of ChatGPT, is under heavy scrutiny for its fast-paced cash burning, and it gets even more damaging when OpenAI is pretty much the firm that started this entire AI trend to begin with.

In other words, AI won't just allow Markets to shoot higher eternally.

Some firms and industries will face pain ahead as the global economy prepares for an existential restructuring.

If and when large numbers of firms see their activities stolen by revolutionary technology, it could not only lead to massive layoffs and reduced consumption but also trigger cascades of entire industries unable to function correctly, resulting in lower profits and, in turn, an inability to repay their heavy debt levels.

This could quickly turn into a global liquidity and credit crisis – but for now, it's mostly fear: fear of creative destruction, which is for now still lifting global earnings to all-time highs.

To put things into perspective, the Dow Jones still reached a 50,000 all-time high just last week, and Nasdaq is still well below 10% to its record, so for now, it's only a turn in narrative – With Stock Indexes maintaining a broadly rangebound picture, it's essential to take a step back and not get too afraid too fast.

Markets are all about risk, so too little risk could prevent seizing good opportunities.

And in any case, volatility is great, not for investors, but for traders who will enjoy more movement.

The narrative could also change quite suddenly, particularly after today's soft CPI print (2.4% vs 2.5% expected), which could finally wake the soft-landing hypothesis, especially with Non-Farm Payrolls beating expectations on Wednesday.

A harsh reality is settling in, and traders will have to keep that in mind when trading: in the times to come, price action will dominate the narratives, so always look at the bigger picture (and check higher-timeframe charts) to stay ahead of what's to come.

Most of the assets which got beaten down last Friday attempted a rebound in this week's action.

The best examples of this are of course Cryptocurrencies and Metals, which suffered heavily last week and are up between 3% to 8% on the week.

What also really shifted is the sudden interest in US Treasuries, which could launch a wave of repositioning.

Bonds had widely been left out of the everything rally in the past three years, bullied by risk-assets and elevated inflation, so keep a close eye to see if this changes.

Discover More:

• Some CPI morning bullishness – Dow Jones and US Index Outlook
• It's an everything rally after the CPI miss – Market Reactions
• US inflation slows, Fed may cut rates more than the market prices in

Traders are getting ready for quite a heavy week for APAC trading.

Sunday will commence with the Japanese GDP for Q4 where traders will now spot whether the effect of Takaichi's appointment turned into a positive for the Land of the Rising Sun.

Looking at how the JPY bounced last week, expect large reactions.

Monday will present the RBA Minutes, pretty important for FX traders particularly considering that the Australian Central Bank is the only one back to hiking.

The Aussie will also see an important test on Wednesday with its employment figures, essential to track whether last hike was just a one off or the beginning of a new cycle.

Tuesday however brings the most important test for APAC traders, with the RBNZ Rate decision. It will be the first press conference for Anna Breman, the new RBNZ Governor.

She will also appear on Thursday so make sure to listen to how she communicates for further clues.

A reminder that Antipodean currencies (AUD and NZD) have rallied quite severely since the beginning of 2026. They will both face a huge test next week.

Despite some key releases for the Eurozone and Germany (Surveys and German CPI on Tuesday, key speeches and PPI on Friday), participants will keep focus on UK data.

Similar to the US last week, they will face a confluence of high-tier releases.

Starting Tuesday, Markets await their Employment data, followed by UK inflation data (CPI, PPI and Retail Price Index) before concluding the week with Retail Sales on Friday.

The release are all during the overnight session in North America (2:00 A.M. ET), so make sure to keep your risk in check.

And of course Euro traders will have to stay aware for Lagarde's speech on Sunday (early) morning.

North American traders will also have some work to do next week.

Not mentioning the few speeches (keep an eye on Bowman Monday), the week really starts on Tuesday with Canadian CPI.

Swap traders are aware that any beat there could significantly add pricing for hikes in Canada for the year to come, particularly after this week's BoC Minutes where it was noted that the current 2.25% rate is on the "Stimulative side".

Turning back to the US, FOMC Minutes will be presented on Wednesday, and while they are not expected to be a Market mover, they could provide interesting views on Inflation, particularly considering how this week's CPI release changed the narrative.

In any case, traders will have to await for Friday before seeing the release of Major data, with a streak of US releases.

The weekly closing session will commence with Core PCE (where Markets await to see if there is any real improvement in the Fed's favorite inflation tracker).

Promptly after, US Services and Manufacturing PMIs will be on deck.

It has been announced just this morning that the Supreme Court will give the decision regarding Trump's tariffs next Friday. This will be a major market mover.

Even after the latest ease in narrative, keep a close eye on geopolitical developments, particularly those involving the US-Iran talks, as they are likely to continue influencing Commodity and broader Markets.

Today's session brought quite a shift in the Market, with today's inflation report allowing for struggling Stocks, Cryptos and Metals to rebound.

Stocks are however closing unchanged despite the very positive CPI report – This could be a rough sign for bulls.

The best outperformers there are of course Ethereum and Bitcoin which are both coming from very far after last week's tumble.

With FX remaining fairly muted, the US Dollar will be key to watch next week as traders await a repricing of FOMC cuts in 2026.

If it doesn't reach new lows next week, this sends a sign of relative strength for the Greenback, particularly with the upcoming Decision on Tariffs.

Safe Trades and enjoy your weekend!

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