USDX Rises on Jobs Data; WTI Falls as Tech and Bank Stocks Rally

EUR/USD slipped to a fresh yearly low below the 1.1600 mark on Thursday, pressured by robust US economic data and broad-based US Dollar strength. Improved risk sentiment followed reports that President Donald Trump softened his rhetoric on Iran, though weak Eurozone data failed to provide support for the single currency.

The US Dollar advanced after upbeat economic releases reinforced confidence in the resilience of the US economy.

Initial Jobless Claims fell to 198,000 for the week ending January 10, down from 207,000 previously and well below expectations of 215,000. The data underscored continued strength in the labor market and prompted investors to scale back expectations for Federal Reserve rate cuts in 2026.

Manufacturing indicators also surprised to the upside. The New York Empire State Manufacturing Index rebounded sharply in January, rising to 7.7 from -3.7, while the Philadelphia Fed Manufacturing Survey surged to 12.6, far exceeding forecasts of -2. Together, the reports pointed to a broad improvement in regional factory activity.

In Europe, the economic calendar was relatively light. Eurozone Industrial Production rose 0.7% month-over-month in November, beating forecasts for a 0.5% increase. On an annual basis, output growth accelerated to 2.5%, up from 2.0% in October and above expectations. Inflation figures from France and Spain for December, however, did little to support the euro.

On January 16, attention will turn to inflation data from Germany and Italy. In the US, investors will focus on December Industrial Production figures, alongside further commentary from Federal Reserve officials.

Bitcoin edged lower during Asian trading on Friday, paring some of its recent gains after US lawmakers postponed discussions on a highly anticipated bill aimed at establishing a regulatory framework for digital assets.

The world’s largest cryptocurrency had climbed as high as $96,000 earlier in the week, but the rally proved short-lived as overall sentiment across crypto markets remained subdued.

Optimism earlier in the week had been fueled by expectations that the proposed legislation would deliver much-needed regulatory clarity for the crypto sector. However, momentum faded after US lawmakers delayed a key debate on the bill, following opposition from Coinbase Global Inc.

Coinbase CEO Brian Armstrong criticized provisions related to stablecoins, arguing that the bill would restrict crypto firms’ ability to offer yields or rewards on customer stablecoin holdings. While investors welcomed the prospect of clearer rules, concerns over these stablecoin measures tempered bullish sentiment.

Despite Friday’s pullback, Bitcoin remained on track for a solid weekly gain, supported by bargain hunting and renewed institutional interest. Much of the advance followed a disclosure by Strategy, the largest corporate holder of Bitcoin, revealing a purchase exceeding $1 billion, which rekindled hopes of improving corporate demand.

Oil prices were largely steady during Asian trading on Friday, following a steep selloff in the previous session that erased most of the gains recorded earlier in the week. The pullback came after US President Donald Trump downplayed the likelihood of imminent military action against Iran, easing fears of supply disruptions.

Thursday’s sharp decline followed comments from Trump indicating that Washington was not planning immediate military intervention in Iran. His remarks helped unwind a geopolitical risk premium that had built rapidly earlier in the week.

Oil prices had surged to multi-month highs after widespread anti-government protests in Iran raised concerns that exports from one of OPEC’s largest producers could be disrupted. Those fears intensified after Trump warned against the use of lethal force on protesters, which markets interpreted as increasing the probability of US military involvement.

Further weighing on crude prices were signs of easing tensions between the US and Venezuela. Trump has signaled support for Venezuela’s continued role within OPEC, opening the door for the country’s oil exports to return more fully to global markets.

Adding to the downside pressure, recent US inventory data showed rising crude and fuel stockpiles, reinforcing concerns over oversupply and limiting upside momentum in oil prices.

US equities closed higher on Thursday, snapping a two-day losing streak as investors bought the recent dip in semiconductor stocks, triggering a broader recovery across the technology sector.

Chip stocks led the advance as bargain hunting followed recent weakness, with sentiment further buoyed by strong earnings from Taiwan Semiconductor Manufacturing Company.

TSMC reported better-than-expected fourth-quarter net profit, as the world’s largest contract chipmaker continued to benefit from outsized demand for advanced processors driven by artificial intelligence applications. Widely viewed as a bellwether for the semiconductor industry, the results helped lift confidence across the sector.

Markets also digested news that President Donald Trump imposed 25% tariffs on imports of certain advanced computing chips on Wednesday. However, the measures were seen as unlikely to materially impact major producers, many of which maintain manufacturing operations within the United States.

Geopolitical risks remained in focus, with Trump expressing optimism about reaching an agreement related to Greenland following high-level meetings between US officials and Danish and Greenlandic foreign ministers.

In corporate news, additional earnings from major banks drew investor attention. Morgan Stanley reported a sharp increase in fourth-quarter profit, driven by a surge in dealmaking activity, while Goldman Sachs posted higher earnings supported by stronger trading revenues, robust investment banking results, and a one-time gain from exiting its Apple credit card partnership.