Investing.com -- Global investors will finally get to see the market impact of President-elect Donald Trump's return to the White House. Trump's inauguration on Monday as the 47th U.S. president is expected to trigger a series of executive orders on issues ranging from taxes to tariffs, just as fourth-quarter earnings season gets underway in earnest. Here's your look at what's happening in markets for the week ahead.
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Trump inauguration
Investors are closely watching as Trump prepares to begin his second term in office on Monday after the incoming president indicated he plans to sign a flurry of executive orders on his first day.
U.S. markets will be closed on Monday for Martin Luther King Jr. Day, so any market fallout may not be fully felt until Tuesday.
Tariff-related moves will be in particular focus, as leaks, counter-leaks, and denials since the election have roiled markets.
Ahead of the inauguration, long-dated U.S. bond yields have risen amid expectations that Trump's proposed tariffs could spark a revival in inflation.
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Earnings
Investors hoping for another strong year in equity markets powered by U.S. corporate profits will get a clearer outlook this week, with a string of companies set to report fourth quarter earnings.
Key earnings reports will come from streaming giant Netflix (NASDAQ:NFLX), healthcare leader Johnson & Johnson (NYSE:JNJ), consumer goods powerhouse Procter & Gamble (NYSE:PG), and credit card issuer American Express (NYSE:AXP).
Earnings season kicked off last week with big banks reporting higher profits, fuelled by a surge in deal-making and strong equity market performance boosting trading revenues.
Overall, analysts expect S&P 500 companies to report a 10.4% year-over-year increase in fourth-quarter earnings, according to LSEG IBES data from January 15, cited by Reuters.
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Davos
Global government and business leaders will attend an annual gathering of the World Economic Forum in Davos, Switzerland, starting on Monday.
A WEF survey released ahead of the gathering last week showed that armed conflict is the most severe risk to the global economy in 2025, followed by extreme weather.
Trump is set to address the meeting by video link on Wednesday. Ukraine's President Volodymyr Zelenskiy is also due to attend and will give a speech on Monday, according to the WEF organisers.
Among other global leaders due to attend the Davos meeting are European Central Bank President Christine Lagarde, European Commission President Ursula von der Leyen, UK Chancellor Rachel Reeves and China's Vice Premier Ding Xuexiang.
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BOJ hike?
The Bank of Japan is to hold its first policy meeting of the year on Thursday and Friday.
In the run up to the meeting BOJ policymakers appeared to be priming markets for a possible rate hike, with both Governor Kazuo Ueda and his deputy Ryozo Himino saying the decision on whether to raise borrowing costs would be up for debate.
BOJ officials will have a few days to weigh up how Trump’s policies could ripple through financial markets before their decision.
A rate hike would narrow the gap between US and Japanese rates, which would bolster the yen. The yen has been hovering close to the 160 level against the dollar, prompting the BOJ to intervene in foreign exchange markets to support the currency.
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Oil prices
Brent crude futures gained 1.3% last week while U.S. West Texas Intermediate crude futures climbed 1.7% for the week, as the latest round of US sanctions on Russia’s energy trade added to fears over potential supply disruptions.
Oil has risen by 10% so far this month, amid worries about the impact of more Western sanctions on Russian crude.
Energy traders are also weighing up the potential implications of Trump's return to the White House on Monday. Trump's pick for Treasury secretary said he was ready to impose tougher sanctions on Russian oil.
Meanwhile a blast of Arctic air has covered much of the US, sending temperatures plummeting. It is forecast to continue until mid-week, looking set to drive up heating oil demand.