Alibaba Jumps 24% on Apple AI Deal. Euro STOXX Up For 8 Weeks

Alibaba surged 24% after announcing a partnership with Apple to support AI services in China ahead of Thursday’s earnings. The Euro STOXX 600 has climbed for eight consecutive weeks, gaining 8% this year, while the Nikkei remains muted due to a stronger yen following better-than-expected Japanese GDP growth. Looking ahead, central banks in Australia and New Zealand are expected to ease policy this week.

Equities

The FTSE 100 fell 0.4% on Friday, ending a three-day run of record highs. However, the index gained 0.7% over the week, marking its third consecutive weekly rise. The pharma sector was the biggest drag, down 1.8%, after Moderna reported a larger-than-expected quarterly loss in the US. NatWest dropped 2% after issuing a weak outlook.

A stronger pound, which hit its highest level against the dollar this year, also weighed on the index. The UK GDP data earlier in the week lifted sentiment around the British economy.

Among gainers, Entain rose 6.8% after US betting company DraftKings raised its 2025 revenue forecast. Segro added 1.3% after reporting a 15% rise in profit for 2024. The FTSE 250 ended flat as John Wood Group sank 55.6% after warning that free cash flow would be negative this year, reversing previous guidance.

In the commodities space, the industrial metals and mining sector gained 0.8% as copper prices reached a three-month high. Glencore rose 2.2% after reports suggested it had held talks over selling its copper and cobalt mines in the Democratic Republic of Congo.

In the US, the S&P 500 ended flat, slipping 0.01%, while the Dow Jones fell 0.37%, and the Nasdaq climbed 0.41% to 20,026.77. Over the week, the S&P 500 gained 1.47%, the Nasdaq added 2.58%, and the Dow rose 0.55%. The Nasdaq posted its biggest weekly increase since early December.

US economic data weighed on sentiment. Retail sales fell 0.9% in January, the largest drop since March 2023, missing expectations of a 0.1% decline. Factory output also fell 0.1%, held back by weaker motor vehicle production.

Meanwhile, President Trump announced plans to introduce reciprocal tariffs on countries taxing US imports and warned BRICS nations about potential duties if they pursued a common currency.

Forex & Commodities

The US dollar fell for the week against the euro, with the dollar index dropping 1.3% to a nine-week low of 106.56. The euro gained 1.7% over the week, reaching $1.0514 at its highest point. The Japanese yen strengthened 0.37% to 152.22 per dollar. A delay in new US tariffs planned by President Trump and optimism over a potential Russia-Ukraine peace deal supported European currencies.

Gold prices ended the week up 0.80% despite a 1.48% decline on Friday, with XAU/USD at $2,883. The US retail sales report showed a sharper-than-expected 0.9% drop in January, weakening the dollar and pushing US Treasury yields lower. The 10-year Treasury yield fell six basis points to 4.472%, while real yields declined to 2.041%. Traders are now pricing in over one rate cut by the Federal Reserve this year.

Oil prices declined on Friday as prospects for a Russia-Ukraine peace deal raised hopes of eased sanctions on Moscow, improving global supply. Brent crude settled down 0.37% at $74.74 per barrel, while US West Texas Intermediate (WTI) crude fell 0.77% to $70.74. Brent posted a marginal 0.11% gain for the week, while WTI lost 0.37%. President Trump ordered talks on ending the conflict after separate calls with Presidents Putin and Zelenskiy.