Asian shares traded higher, and gold prices declined on Monday, February 16, 2026, ahead of the Lunar New Year holidays. Tokyo’s Nikkei 225 edged 0.1% higher to 56,996.21, after the government reported that Japan’s economy grew more slowly than economists had expected in the latest October-December quarter, at an annualized 0.2%. Thus, increasing expectations that Prime Minister Sanae Takaichi may push forward the fiscal stimulus measures.
Asian Markets Mixed in Thin Holiday Trading
Trading was thin because the stock markets in China, South Korea, and Taiwan were closed. Hong Kong’s Hang Seng rose 0.5% in a half-day session, closing at 26,705.94, Australia’s S&P/ASX 200 gained 0.3%, and India’s Sensex was also up 0.2%. Oil prices were steady, with U.S. crude rising slightly to $62.94 per barrel. The U.S. stock futures edged higher, following a Friday recovery after a sharp AI- driven selloff. The S&P 500 had inched up less than 0.1%, supported by cooling inflation data that bolstered hopes for a future Federal Reserve rate cut. NVIDIA, the computer chipmaker, was the most heavily weighted on the S&P 500 and was down 2.2% on Friday. The Technology company AppLovin rose 6.4% after losing almost a fifth of its value, as investors were focused on how AI could disrupt the businesses of software and technology-related firms. The euro was trading at $1.1867, down from $1.1872, while the U.S. dollar strengthened to 153.08 Japanese yen, up from 152.64.
In the meantime, the gold prices fell 1.1% to $4,994.60 per ounce, dropping below the $5,000 mark, and silver also dropped 3.8%. The decline in gold was triggered by a stronger-than-expected US jobs data, which showed 130,000 new non-farm payrolls in January. Additionally, reports of a potential Russia-US economic partnership, including a return to US dollar trade settlements, weakened the “de-dollarisation” narrative that had supported the gold demand. However, analysts are maintaining a long-term bullish attitude, citing institutions like BNP Paribas forecasting gold to reach $6,000 per ounce by year’s end amid the geopolitical risks and central bank buying.
The U.S. Inflation Data Revives Hope
The Hong Kong Exchanges (HKEX), SSE, and SZSE were closed for the Year of the Horse, a major driver for the regional liquidity drains. The U.S. market was also closed for Presidents’ Day. An X handle posted that “it is holiday liquidating today.”
The post also pointed out that the real move will begin when the liquidity returns later this week. The markets showed signs of stabilising after a tech-led plunge last week, when traders reacted to the growing concern about the hundreds of billions spent on AI infrastructure.
The US inflation and rate outlook data revived hopes for a Fed rate cut later in 2026. The Cleveland Fed’s inflation forecast for February 2026 shows core PCE at 2.81% year-over-year, down from 2.84% in December last year. This gradual moderation supports the view that the Fed may begin easing if the labor market conditions soften.
