- Stocks climbed following Biden's signal that he’d reconsider the China tariffs imposed by the Trump administration. The dollar and bonds fell.
- After JPMorgan CEO Dimon suggested "storm clouds" over the US economy may disperse, big banks led gains in the S&P 500. The euro rose when European Central Bank President Christine Lagarde announced that higher interest rates will be implemented in July.
- Separately, Biden stated that the US military would intervene to defend Taiwan in the event of a Chinese invasion, comments that appeared to defy the White House's long-standing policy of "strategic ambiguity" until being retracted. Meanwhile, his administration announced that a dozen Indo-Pacific nations will join the United States in a broad economic project aimed at countering China's regional influence.
- A UN official stated that Russia's blockade of Ukraine's ports is a "declaration of war" that risks triggering mass migration and a worldwide food crisis, adding to the gloomy warnings issued on the first day of the World Economic Forum in Davos. A diplomat at Russia's United Nations office in Geneva has resigned in protest of President Vladimir Putin's invasion of Ukraine, making him the first envoy to publicly criticize the conflict.
- As investors assess the impact of China's COVID policies and monetary tightening on the future for the world's leading economies, equities have been turbulent. Beijing recorded a record number of cases, reigniting fears of a lockdown, and took a variety of steps to help the economy stabilize.
- The minutes of the most recent Federal Reserve rate-setting meeting will provide insight into the US central bank's tightening route to the markets this week. The Fed should front-load an aggressive series of rate hikes to bring rates to 3.5% by year's end, according to St. Louis Fed President James Bullard, which, if successful, would lower inflation and lead to easing in 2023 or 2024.
