Stock Market Update

The S&P 500 futures are down 14 points and are trading 0.2% below fair value, the Nasdaq 100 futures are down 90 points and are trading 0.4% below fair value, and the Dow Jones Industrial Average futures are down 50 points and are trading 0.1% below fair value.

There's a negative bias in early trading after mega cap-led gains yesterday. Pre-open declines in some technology names have contributed to the bias, along with a jump in market rates. The 10-yr yield is up three basis points to 4.30% and the 2-yr yield is up two basis points to 4.18%. 

Selling in the Treasury market follows a surprise 50 basis points rate cut by the Swiss National Bank, bringing its policy rate to 0.5% against expectations for a smaller cut. The vibe in the market may shift after another US inflation reading in the form of the November Producer Price Index at 8:30 ET.

In corporate news:

• Adobe (ADBE 485.45, -64.48, -11.7%): beats by $0.14, beats on revs; guides Q1 EPS in-line, revs below consensus; guides FY25 EPS below consensus, revs below consensus; downgraded to Hold from Buy at TD Cowen
• Oxford Industries (OXM 80.98, -3.13, -3.7%): misses by $0.20, misses on revs; guides Q4 EPS below consensus, revs in-line;
• Lucid Group (LCID 2.46, +0.03, +1.2%): in discussions with automakers about partnerships, according to Bloomberg
• Kroger (KR 62.60, +1.27, +2.1%): approves new $7.5 bln repurchase plan
• Nvidia (NVDA 138.53, -0.78, -0.6%): increases hiring in China amid push for artificial intelligence technology in cars, according to Bloomberg

Reviewing overnight developments:

• Equity indices in the Asia-Pacific region ended Thursday on a mostly higher note. Japan's Nikkei: +1.2%, Hong Kong's Hang Seng: +1.2%, China's Shanghai Composite: +0.9%, India's Sensex: -0.3%, South Korea's Kospi: +1.6%, Australia's ASX All Ordinaries: -0.3%.
  • In economic data:
    • India's November CPI 5.48% yr/yr (expected 5.53%; last 6.21%). October Industrial Production 3.5% yr/yr, as expected (last 3.1%) and October Manufacturing Output 4.1% m/m (last 3.9%)
    • Hong Kong's Q3 PPI 3.2% yr/yr (last 3.1%) and Q3 Industrial Production -0.1% yr/yr (last 0.7%)
    • Australia's November Employment Change 35,600 (expected 26,000; last 12,200) and full Employment Change 52,600 (last 8,900). November Unemployment Rate 3.9% (expected 4.2%; last 4.1%) and Participation Rate 67.0% (expected 67.1%; last 67.1%)
    • New Zealand's November Electronic Card Retail Sales 0.0% m/m (last 0.7%); -2.3% yr/yr (last -1.1%)
  • In news:
    • Expectations for a December rate hike from the Bank of Japan receded following reports that the central bank does not see the need to rush with a rate hike this month.
    • China's Central Economic Work Conference concluded today, but there have been no policy-related announcements yet.
    • Australia reported strong employment figures for November, fueling speculation that the Reserve Bank of Australia will not cut its cash rate until May.
• Major European indices trade near their flat lines while Italy's MIB (+0.4%) outperforms ahead of an expected 25-basis point rate cut from the European Central Bank at 8:15 ET. STOXX Europe 600: -0.1%, Germany's DAX: UNCH, U.K.'s FTSE 100: +0.1%, France's CAC 40: UNCH, Italy's FTSE MIB: +0.4%, Spain's IBEX 35: -0.2%.
  • In economic data:
    • Italy's Q3 Unemployment Rate 6.1% (expected 6.6%; last 6.8%)
  • In news:
    • Earlier, the Swiss National Bank lowered its policy rate by 50 basis points to 0.50% against expectations for a smaller cut. The central bank also lowered its domestic growth forecast for 2025 to a range of 1.0-1.5% from 1.5% and cut its CPI forecast to 0.3% from 0.6%.
    • Meanwhile, Germany's ifo Institute adjusted its domestic growth forecast for 2025 to 0.4-1.1% from 0.9%. French President Macron is expected to name a caretaker prime minister later today.