By Dow Jones Newswires Staff
Global stock markets, U.S. futures rose in early European trade after a landslide election win for Japan's Liberal Democratic Party sent Asian equity markets higher and encouraged a cautious return to risk. Prime Minister Sanae Takaichi won a more than two-thirds majority in the country's lower house, handing her a mandate to pursue fiscal expansion and pro-growth policies.
Equities in Europe and Asia rallied as Bitcoin and precious metals--encouraged by dollar weakening--gained, while U.S. equity futures nudged up after staging a sharp recovery Friday. Oil fell further as U.S.-Iran negotiations continued.
Traders await key U.S. economic indicators this week, with U.S. nonfarm payrolls and consumer-price index data set to provide more clues on the path forward for interest-rate cuts.
--U.S. equity futures nudged up in early European trade. The Dow Jones Industrial Average gained 0.2% premarket after notching a record close Friday, while futures for the S&P 500 rose 0.1%. Premarket gains for the tech-heavy Nasdaq were more muted, with the index edging up 0.03%. Tech companies surged Friday after a heavy week of selling, with the Nasdaq recording its best day since November 2025.
--Asian markets gained as tech stocks matched Friday's rally in the U.S. and the Japanese election added to the risk-on mood. Japan's Nikkei Stock Average closed 3.9% higher at a record high as Takaichi's pro-market policies look set to benefit defense and technology stocks in particular, Swissquote analyst Ipek Ozkardeskaya said. Meanwhile, South Korea's Kospi snapped a two-session losing streak to finish 4.1% higher. Index heavyweights Samsung Electronics and SK Hynix added 4.9% and 5.7%, respectively. Thailand's benchmark SET Index rose as much as 3.7%. Tech stocks in China and Hong Kong were on firmer ground as well, recovering from selloffs last week. The Hang Seng Tech Index was 2% higher, led by gains in chips and health-technology firms. China's Nasdaq-like ChiNext index gained 3%, while the Shanghai Composite Index added 1.4%.
--European equities followed Asian peers higher at the open as financials traded strongly. Both the Italian FTSE MIB and Spanish IBEX 35 climbed thanks to the banks that dominate the indexes, with the pair rising around 1%. UniCredit gained 4.7% in Milan after guiding for revenue and profit growth, while Banco de Sabadell climbed 3.3% in Madrid. Conversely, U.K. banks faltered amid pressure on the country's sovereign bonds. NatWest fell 3.1% after announcing plans to acquire Evelyn Partners, while Lloyds Group slipped 2.2%. The FTSE 100 nudged up 0.4% as miners gained. Tech stocks also pushed higher, with STMicroelectronics climbing 4.4% on an extension of its partnership with Amazon, helping the French CAC 40 to rise 0.4%. The German DAX gained 0.7%, boosted by banks and industrials as Commerzbank climbs 2.5%.
--The U.S. dollar fell as the Japanese yen gained after Sunday's election. "The landslide victory will reinforce her responsible but expansionary fiscal spending and a more Japan-focused foreign policy," ING's Min Joo Kang said in a note. "Risk-on sentiment will dominate the market for now," the senior economist for South Korea and Japan said. The DXY index, which measures the dollar's moves against a basket of currencies in which the yen is a major component, fell 0.3% to 97.379.
--U.S. Treasury yields rose across maturities in Asian trade, with the two-year yield up 2.1 basis points at 3.514% and the 10-year yield rising 3.2 bps to 4.237%. Long-dated Japanese Government Bond yields could face upward pressure on Takaichi's landslide election win, Invesco's David Chao said. Investors watch for expanded fiscal outlay pushing up borrowing, while the election could result in the Bank of Japan raising rates sooner than expected, Barclays analysts said. Yields on 10-year JGB were up 5 bps at 2.280%.
Eurozone government bond yields rose in line with global peers. This week's scheduled supply will come from the Netherlands, Austria, Germany, Portugal, Greece and Italy, with the door open for syndications as well. The 10-year German Bund yield rose 1 bp to 2.857%, according to LSEG. Meanwhile, political uncertainty added to pressure on U.K. government bonds. Ten-year U.K. gilt yields climbed 2 bps to last trade at 4.543% as Prime Minister Keir Starmer's position looks increasingly unsteady.
--Bitcoin fell back from intraday highs but remained above $70,000. The cryptocurrency fell 0.4% to $70,400, having hit $72,217 earlier in the session, according to LSEG data. Bitcoin's stabilization above $70,000 is "a stark contrast to last week's extreme fluctuation," Deutsche Bank strategists said in a note.
--Oil prices fell 1% in early trading as investors closely monitored developments in U.S.-Iran negotiations. Brent crude slipped 1.1% to $67.13 a barrel, while WTI was down 1% to $62.26 a barrel. However, "there's still plenty of uncertainty over how things will evolve," ING analysts said. "This suggests the market will likely continue to price in a risk premium." According to the research firm, speculators are growing wary of betting against oil. Positioning data show traders sharply increased bullish bets on Brent crude, largely by covering short positions, pushing net longs to their highest level since April 2025. Options markets echoed the shift, with traders increasingly positioned for a potential rise in oil prices.
--Gold prices rose back above the $5,000 mark on a softer dollar. In early trading, futures in New York were up 1.4% to $5,050.80 a troy ounce, while the U.S. dollar index fell 0.2% to 97.41. "Investors reasserted their long-term bullish views on the precious metal," analysts at ANZ said. Large institutional investors remain bullish on bullion despite the recent selloff, a view echoed by the People's Bank of China, which extended its gold-buying streak to 15 months in January, according to the research firm. Meanwhile, silver climbed 6% to $81.55 an ounce.
Write to Barcelona Editors at barcelonaeditors@dowjones.com
(END) Dow Jones Newswires
February 09, 2026 04:31 ET (09:31 GMT)
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