Bonds & Stocks
A New Year’s rally in US stocks paused as a rotation into regional shares broadened and investors awaited fresh data to gauge the outlook for Federal Reserve interest rates. The S&P 500 was set to open little changed, stalling the advance seen in the first trading days of 2026. European stocks rose 0.4%. Shares in Asia extended their best-ever start to a year and a gauge of emerging markets hit back-to-back records. Nasdaq 100 futures rose 0.2% as the artificial-intelligence trade remained in focus.
Economy
Federal Reserve Governor Stephen Miran said the US central bank will need to cut interest rates by more than a percentage point in 2026, arguing monetary policy is restraining the economy. “I think it’s very difficult to argue that policy is about neutral. I think policy is clearly restrictive and holding the economy back,” Miran said Tuesday during an appearance on the Fox Business Network. “I think that well over 100 basis points of cuts are going to be justified this year.”
World
President Donald Trump’s push to unlock Venezuelan crude is strengthening the political case for a proposed pipeline that would allow Canada to ship more oil to China and other Asian markets. Refineries in the American Midwest are configured to process Canada’s heavy crude. But prices for the commodity slumped Monday as traders worried that the removal of Venezuelan President Nicolas Maduro will clear the way for US access to abundant resources from the South American country, which produces a similar type of oil.