Market Shifts From Tech to Dow

Ultima Markets Daily Market Insights – February 5, 2026

A clear shift is unfolding across US equity markets. As confidence in the "AI trade" weakens following cautious guidance from major chipmakers and software firms, capital is rotating decisively into defensive and value-oriented sectors. This rotation lifted the Dow Jones higher yesterday, even as the Nasdaq continued to slide.

The macro backdrop remains uneven. The latest ADP employment report surprised sharply to the downside (22K vs 48K expected), pointing to a cooling labour market. At the same time, ISM Services PMI held firm at 53.8, signalling that broader economic activity remains resilient. With the NFP report cancelled due to the recent partial US Government shutdown, markets are left navigating this mixed data set without a clear labour-market anchor.

Market Rotates From Tech to Dow Jones

The Nasdaq 100 fell more than 1.5%, pressured by weakness across software and semiconductor names. In contrast, the Dow Jones finished higher, supported by inflows into Healthcare, Industrials, and Banking stocks.

Growing scepticism around the near-term returns of heavy AI investment, combined with early signs of labour market softening, has pushed investors toward companies with steadier earnings and cash flows. As a result, value stocks are increasingly favoured over high-growth technology names.

Outlook

With NFP off the calendar, the divergence may persist. Value-oriented indices are likely to outperform, while tech remains vulnerable to risk aversion.

On the NAS100, the 250,000 level remains a key level to watch. Recent declines have pushed the index into a range-bound phase. Holding above 25,000 would keep price action contained, while a lower break could open the door to a deeper corrective move.

Gold Lingering Around The $5,000 Zone

XAUUSD continues to battle around the psychologically important 5,000 level. After briefly reclaiming this zone, prices have struggled to extend higher, facing firm resistance near 5,050 - 5,080.

Resistance

5,000 - 5,100 remains the critical zone. A sustained close above this area is required to unlock further upside.

Support

4,800 serves as near-term support. A break below would expose Gold to renewed selling pressure.

Overall, Gold is likely to remain in consolidation, with 5,000 acting as the dominant pivot for now.

Central Bank Decisions To Watch Today

• Bank of England (BoE) Rate Decision (12:00PM GMT)
  • Expectation: Hold at 3.75%
  • Market Focus: Markets are pricing in a cut by April. Any dovish signal from Governor Bailey, particularly around slowing inflation, could pressure GBP/USD.
• European Central Bank (ECB) Rate Decision (1:15PM GMT) 
  • Expectation: Hold at 2.00%
  • Market Focus: With inflation near target but growth weak, attention will centre on President Lagarde's tone. Emphasis on downside growth risks could weigh on the Euro.

EURUSD Speculations

The 1.1800 level remains critical ahead of the ECB decision. The broader bias stays cautiously bearish, with US Economic resilience contrasts with European stagnation.

Support is located in the 1.1800 - 1.1740 zone. A hawkish ECB hold could support the Euro, while any Dollar softness may allow this support area to be tested.

GBPUSD Speculations

GBP/USD continues to trade sideways near 1.3650 with volatility elevated ahead of the BoE decision. The Pound remains vulnerable if policymakers signal openness to joining the global easing cycle.

For now, expectations of a cautious BoE stance may offer near-term support.

Key Levels: Support at 1.3600. Resistance at 1.3710.

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