The good news of the week came from the U.S. inflation data. On a sequential basis, the general price index fell 0.1% in December, slightly more than consensus expectations. It was also the first time since May 2020 that the figure was down. On an annual basis, the price increase is 6.5%, the lowest level since October 2021. As shown in the chart below, the 3-month annualized inflation rate is decelerating sharply, including ex-housing services inflation. 

Note that other macroeconomic data this week (unemployment claims, consumer sentiment) indicate that the U.S. economy continues to do relatively well, despite the decline in the inflation rate. Overall, these figures reinforce the hope of a "soft landing" for the US economy.

U.S. inflation numbers and reassuring early corporate earnings helped equity markets post a second consecutive week of gains. The Nasdaq and growth sectors outperformed, led by a rebound in some technology mega-caps. The major U.S. investment banks (JPMorgan, Wells Fargo, Bank of America) reported better-than-expected Q4 earnings (although their outlook for the year is relatively conservative).

As the chart below shows, the S&P 500 closed just above its 200-day moving average. But the long-term negative trend line has yet to be broken. The entire 4000-4080 area remains an important resistance zone.

Interestingly, the best performances at the beginning of the year are recorded by the stocks and sectors that suffered the most in 2022...This observation is valid for the stocks and sectors of the S&P 500 but also for the different asset classes. 

The CSI 300 Chinese stock index is now trading well above the long-term downtrend. It is also worth noting that the index broke the 200-day moving average on Friday.

Bitcoin broke the $19,000 mark on Friday. This is its best week since October 2021. It is also noted that Bitcoin is now trading above its 200-day average. 

Friday was the 6th consecutive day of gains for the yellow metal. It has appreciated 5% since the employment figures were published and is now trading at its highest level since April 2022. As a result of this rise, a "golden cross" has formed on the gold chart (the 50-day moving average has risen above the 200-day).

The release of U.S. inflation data helped U.S. Treasury yields to continue their downward trend. The 10-year yield touched a low of 3.43% during Friday's session. The inversion of the yield curve (3 months - 10 years) continues to increase, reflecting expectations of a recession in the US.