Stocks cheer megacap earnings; CBUAE keeps rates unchanged

Wall Street shares looked set for more gains on Thursday, as investors cheered earnings from Meta, but shunned Microsoft, while the dollar was steady against most other currencies after the Federal Reserve left rates unchanged.

The Central Bank of the UAE (CBUAE) has decided to maintain the Base Rate applicable to the Overnight Deposit Facility (ODF) at 4.40%.

This decision was taken following the US Federal Reserve’s announcement to keep the Interest Rate on Reserve Balances (IORB) unchanged.

The CBUAE has also decided to maintain the interest rate applicable to borrowing short-term liquidity from the CBUAE at 50 basis points above the Base Rate for all standing credit facilities.

The Base Rate, which is anchored to the US Federal Reserve’s IORB, signals the general stance of monetary policy and provides an effective floor for overnight money market interest rates in the UAE.

The exception was the yen, which strengthened across the board, as expectations mount for the Bank of Japan to keep raising interest rates while other central banks cut.

The European Central Bank cut interest rates as expected on Thursday and reiterated that Eurozone inflation is increasingly under control despite concerns about global trade, leaving the euro a touch weaker on the day.

The US central bank, meanwhile, held rates steady on Wednesday, also in line with expectations, with Fed Chair Jerome Powell saying there would be no rush to cut them again.

President Donald Trump’s policies remain a risk for the Fed’s policy outlook, and Saturday is likely to see new tariffs slapped on Canada, Mexico and possibly China.

US stock index futures rose 0.5-0.8%, pointing to an upbeat start for the technology-heavy Nasdaq , which fell 0.5% on Wednesday, as did the S&P 500 . The first earnings from the group of so-called “Magnificent Seven” megacap tech stocks were a mixed bag.

Microsoft beat quarterly revenue estimates, while Tesla’s fourth-quarter profit margin missed expectations. Meta forecast first-quarter revenue below market estimates. Apple reports results later Thursday.

Microsoft shares fell 4% in premarket trading, while those in Meta and Tesla rose 1.9% and 3.3%, respectively.

The results did little to further the debate on Chinese startup DeepSeek’s potential threat to US dominance in artificial intelligence, and the big spending behind it - questions that triggered a rout in global tech stocks on Monday.

“Microsoft, Tesla, and Meta are all making massive AI investments, but investors are now demanding real results,” Jacob Falconcrone, Saxo chief investment strategist for Europe, said.

In Europe, the STOXX 600 hit a new record high, rising 0.5%, in a heavy earnings day.

Some of the big names reporting results included lenders Deutsche Bank, BBVA and CaixaBank , along with energy producer Shell and retailer H&M.

In the foreign exchange market, the dollar held steady against most other major currencies, with the euro down 0.1% at $1.0407 after the ECB rate decision.

“Policymakers appear not to have wanted to ‘rock the boat’ this time around, and are unlikely to want to do so moving forwards, with a predictable pace of 25-basis-point cuts at each of the next few meetings remaining the base case, until the Governing Council has moved the deposit rate back to neutral,” Pepperstone strategist Michael Brown said.

Sterling, meanwhile, was flat at $1.2442.

The yen, however, strengthened about 0.7% to 154.0 per dollar with Bank of Japan Deputy Governor Ryozo Himino saying in a speech that the central bank will continue to raise interest rates if the economy and prices move in line with its forecasts.

Traders currently expect one more quarter-point increase this year, potentially as soon as July.

Oil prices fell, as traders remained nervous about this weekend’s Feb. 1 deadline by which Trump has said he will impose tariffs on Canada and Mexico, the two largest suppliers of crude to the United States.

US crude futures eased 0.2% to $72.48 a barrel, while Brent crude futures dipped 0.1% to $76.50.

(Additional reporting by Kevin Buckland in Tokyo. Editing by Hugh Lawson and Mark Potter) METALS-Copper, aluminium edge higher as market awaits tariff details.

Copper and aluminium prices crept higher on Thursday as investors waited to see whether US President Donald Trump would follow through with his threat to impose tariffs this weekend.

Three-month copper on the London Metal Exchange (LME) was up 0.3% at $9,098 a metric tone in official open-outcry trading while aluminium was a touch firmer at $2,620.50.

LME copper has shed 10% since hitting a four-month peak of $10,158 last September.

“The problem with all the base metals is that they’re in a waiting pattern to figure out what’s happening with tariffs,” said Nitesh Shah, commodity strategist at WisdomTree.

“That’s really throwing a lot of noise into the market at the moment and it’s hard to see how other fundamentals can be heard above that at the moment.” Trump’s spokeswoman on Tuesday said he still planned to make good on his promise to slap new tariffs on Canada, Mexico and possibly China, the world’s biggest metals consumer, on Saturday.

WAM / Agencies