00:00How Asian markets have started 2026, how they're dealing with the latest geopolitical headlines.
00:05It's really interesting, Paul, to see that stocks are rallying here in Europe.
00:08It's defence names. It's also tech.
00:11Over in Asia, tech getting a lot of the gains.
00:14If this really was about a geopolitical re-evaluation and that pushed defence names higher,
00:18you'd think that maybe TSMC wouldn't be doing quite so well today, and yet it is.
00:22So clearly there is a lot of focus on the tech themes beyond geopolitics.
00:27Yeah, definitely plenty of momentum there.
00:32Actually started at the back end of last week.
00:34The first day of trading in Asia was particularly strong as well.
00:37We had the Samsung CEO saying Samsung is back, and that was enough to lift the stock about 7% that day.
00:44We had a new company trading, B-Run, which is a chip designer, and that went flying higher in Hong Kong as well.
00:51You know, the market just gathering a lot of momentum.
00:53So we've got big gains again across the Cosby, and for Samsung, SK, Hynix, those big names in the chip space,
01:00and particularly TSMC, which is such a huge part of the Asia index, really leading the rally.
01:07We have Goldman Sachs, as Tom was talking about, with that upgrade, talking about margins coming down,
01:12plenty of demand still fueling the rally in the company.
01:16And, you know, in addition to that, it's not just about Asia, but also because TSMC is such a big part of the emerging markets gauge,
01:24we've also seen that go to a record high today, which is quite an interesting development,
01:28beating the last record, which was five years ago.
01:30Paul, how much of today's market action can I pin on Venezuela?
01:38I think very little, to be honest, Guy.
01:42My sort of sense is that, if anything, the market is kind of taking this as a reasonably positive development.
01:48Let me explain a little bit, because obviously the action is quite shocking in terms of how direct it was and unexpected.
01:58But on the flip side of that, you know, the fact that the equity market is up.
02:02In fact, each time that Trump seems to do one of these foreign expeditions or, you know, actions,
02:09the market tends to rally on it rather than sell offers.
02:12So it seems like the market, you know, is buying into the action that the Trump administration is taking
02:18to try to reshape the world a little bit and taking heart from it rather than expecting there to be some big escalation
02:24that causes a long-term risk-off or hurt to the economy.
02:28Paul, so given that, what derails this rally?
02:33Yeah, so I think, well, if there were to be a dramatic escalation
02:38and more people were to come to sort of Venezuela's defences, then that may complicate matters in the short term.
02:46I think, you know, at the end of this week, we have non-firm payrolls,
02:49so obviously the Fed will come back into consideration to a certain extent.
02:53And then, you know, the continuing concerns over the tech bubble.
02:56We get a lot of debt sales this week.
02:58I wonder how well they'll go and what that will tell us about demand for credit going into this year.
03:02But otherwise, it seems like the market is pretty happy with the direction that it's trading in at the moment
03:07and that that momentum is continuing to push through.
03:10You know, one of the best starts of the years for stock markets that we've seen in over a decade, I think.
03:15So plenty of momentum is still going there.
