Global markets rebounded strongly on Friday, with the yen's depreciation pressure intensifying, and cryptocurrencies also following the upward trend.

The Bank of Japan’s decision to raise interest rates by 25 basis points triggered a major market震荡. Although the risk of “carry trade” liquidation has temporarily eased, USD/JPY surged 1.39% to approach the 158 level, with the Japanese Finance Minister issuing multiple warnings of intervention. Meanwhile, Micron Technology’s strong earnings report supported a rebound in market risk appetite, with the VIX fear index falling by 11.57%.

Last Friday was the “quadruple witching” day for US stocks, with $7.1 trillion in expiring contracts driving the three major indices higher—Dow up 0.38%, S&P 500 up 0.88%, Nasdaq up 1.31%. Nvidia performed the strongest, leading the Dow components, Oracle rose 6.6%, Broadcom increased 3.2%. However, Nike’s China business dragged down the stock, falling 10.5%. In cryptocurrencies, a rebound also occurred, with Bitcoin currently at $91,220, up 1.35% in 24 hours; Ethereum at $3,140, up 1.10% in 24 hours.

Silver became the biggest winner this week. Driven by investment demand and tight supply, silver prices soared to a record high, breaking through the $67.0 level. Gold closed for the second consecutive day with a doji star, at $4,338.6 per ounce. Crude oil rose 1.14% to $56.5 per barrel. European stocks also rose across the board, FTSE 100 up 0.61%, CAC 40 up 0.01%, DAX 30 up 0.37%.

Japanese 10-year bond yields hit 25-year high, changing the carry trade landscape

Most notably, the yield on Japan’s 10-year government bonds rose above 2%, reaching the highest level since 1999. This signals an important message—the expectations and pressure for future rate hikes by the Bank of Japan are accumulating. Although the nominal interest rate differential still exists, for high-leverage global macro hedge funds, the “cost-effectiveness” of the yen as a financing currency has significantly declined.

France’s 2026 budget negotiations broke down, with the 30-year government bond yield rising to 4.525%, the highest since 2009. The US 10-year Treasury yield increased 3 basis points to 4.15%, and the 2-year yield rose 3.2 basis points to 3.492%. The market focus is whether the aggressive stance of the Bank of Japan will ultimately prompt the Federal Reserve to accelerate its rate cut pace.

Fed officials show divergence, no rate cut plans in the near term

New York Fed President Williams stated that the Federal Reserve currently sees no urgency to further adjust interest rates. He believes the rate cuts already implemented have put policy in a good place and hopes inflation will fall back to 2% without harming the labor market.

Cleveland Fed President Mester was even more direct, saying that after three rate cuts in recent meetings, there is no need to adjust rates in the coming months, at least until spring. She is more concerned about rising inflation than weak employment and opposes recent rate cut measures.

This reflects internal disagreement within the Fed on inflation and employment outlooks. The latest forecasts released after last week’s meeting only expect one rate cut next year. The US December Consumer Confidence Index also reflected weakness, rising less than expected to 52.9, with economists’ median forecast at 53.5. Consumers’ outlook on purchasing big-ticket items has deteriorated to a historic low.

Policy shift, technology and space become new focal points

Trump has shelved the Mars plan and shifted focus to lunar missions, aiming to land on the Moon and establish a lunar base by 2028. The US is eager to surpass China, which plans to send astronauts to the Moon and establish a base before 2030.

On the other hand, US House Republicans are calling for congressional oversight of AI chip exports similar to military sales. Trump previously promised to allow Nvidia to export AI chips H200 to China, but this bill requires any processor with performance equal to or higher than H200 to be reported to Congress before being sold to hostile countries.

Tech giants hit new highs, ByteDance profits near Meta

ByteDance’s profits this year are expected to reach $50 billion, a record high. The company has already accumulated about $40 billion in net profit in the first three quarters, exceeding internal expectations and approaching Meta’s projected annual profit of $60 billion. ByteDance has signed a binding agreement to spin off TikTok’s US operations into a joint venture primarily owned by US investors (including Oracle Holdings), to ensure platform operations and reduce Chinese company control.

Market sentiment is shifting—from the Bank of Japan’s rate hike, US dollar appreciation, and record highs in silver, to new developments among tech giants. Investors need to closely monitor how these changes will impact global asset allocation.