The Davy Digest - 12th January 2026

Global equities rose last week during the first full trading week of the new year. Geopolitical and policy risks dominated headlines, as the Trump administration threatened to limit share buybacks and dividends for defence companies, restrict institutional ownership of homes in the US, and applied renewed pressure on the Federal Reserve. On the data front, the US labour market was in focus. Friday’s Nonfarm Payrolls print was the most closely-watched release, but fell short of expectations, with the US adding just 50,000 jobs in December. Meanwhile, the unemployment rate fell to 4.4%. Elsewhere, the November Job Openings and Labour Turnover Survey (JOLTS) showed that hiring slowed, while job openings fell to 7.1 million – the lowest level since September 2024.

In Europe, inflation slowed to 2.0% year-over-year during December, in line with expectations, while unemployment fell to 6.3%, better than expected. Elsewhere, in Brazil, inflation decelerated to 4.3% year-on-year, falling within the central bank’s target range.

Last week's highlights

	November JOLTS (07/01) – Job openings fell to 7.15mn (vs 7.65mn expected), while layoffs fell to 1.69mn December Jobs Report (09/01) – Added 50k jobs during December (vs 70k expected), while the unemployment rate fell to 4.4%, lower than expected
	Eurozone Inflation (07/01) – Slowed to 2.0% YoY during December, in line with expectations Eurozone Unemployment (08/01) – Unemployment fell to 6.3%, below consensus
	S&P December Composite PMI (06/01) – Revised down to 51.4
	China Inflation (09/01) – Consumer prices rose by 0.8% YoY, while producer prices fell by 1.9% Brazil Inflation (09/01) – Slowed to 4.26% YoY, in line with expectations

This week, we will get an update on inflation in the US. December’s Consumer Price Index release will take place on Tuesday, before the Producer Price Index is released on Wednesday. In the United Kingdom, there will be an industrial production reading released on Friday. Further afield, in Japan, the Producer Price Index figure for December will be released.

What's on the radar

	December Consumer Inflation (13/01) December Producer Inflation (14/01) Industrial Production (16/01)
	German Inflation (09/01)
	November Industrial Production (15/01)
	Japan Producer Price Index (14/01)

Chart of the moment - Seven out of sync

Source: Bloomberg, as of 09/01/2026. Performance is measured using price return in USD. The Magnificent Seven refers to Nvidia, Apple, Alphabet, Microsoft, Amazon, Meta, and Tesla.

• The dominance of the Magnificent Seven has been one of the primary themes in equity market in recent years.
• However, last year only two members of the Magnificent Seven outperformed the index – Alphabet and Nvidia, which returned 65% and 39%, respectively.
• As we enter 2026, it remains to be seen whether the dispersion of performance within the basket and across the broader index will continue.
   

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