Stock Market Update

The S&P 500 futures are up five points and are trading 0.1% above fair value, the Nasdaq 100 futures are up 35 points and are trading 0.2% above fair value, and the Dow Jones Industrial Average futures are down 25 points and are trading 0.1% below fair value.

Stock futures are mixed, and little changed, ahead of the final session before Christmas. Markets close early today (the equity market at 1:00 p.m. ET and the bond market at 2:00 p.m. ET) and markets are closed tomorrow. It is the first day of the Santa Claus rally period, which occurs over the last five trading days of the year and the first two trading days of the new year and usually features a positive bias. 

Treasury yields are also little changed. The 10-yr yield is up one basis point to 4.61% and the 2-yr yield is unchanged from yesterday at 4.35%.

There is no US economic data today.

In corporate news:

• American Airlines (AAL 17.16, -0.09, -0.6%): exhibiting volatile price action ahead of the open after grounding flights nationwide due to a technical issue before news that FAA ground stop has been lifted
• US Steel (X 31.22, -0.15, -0.5%): Nippon Steel's plan to acquire US Steel was referred to President Biden for review. The White House has promised to block the deal, according to WSJ
• Bank of America (BAC 43.84, -0.05, -0.1%), JPMorgan Chase (JPM 238.70, +0.31, +0.1%), Citigroup (C 69.78, +0.01, +0.01%): CNBC reporter Sarah Eisen says "The big banks will sue the Federal Reserve, with a lawsuit to be filed as soon as today, according to a person familiar with the matter. Banks have had problems with the opaque, secretive nature of the stress tests for years, and the capital rules that come out of it"
• Starbucks (SBUX 87.44, 0.0, 0.0%): provides update on strike "very small number of stores were temporarily closed – approximately 60 in total as of today – because of the actions called for by Workers United"

Reviewing overnight developments:

• Equity indices in the Asia-Pacific region ended Tuesday on a mixed note. Japan's Nikkei: -0.3%, Hong Kong's Hang Seng: +1.1%, China's Shanghai Composite: -0.1%, India's Sensex: -0.1%, South Korea's Kospi: -0.1%, Australia's ASX All Ordinaries: +0.2%.
  • In economic data:
    • Japan's October BoJ Core CPI 1.7% yr/yr (expected 1.5%; last 1.5%)
    • South Korea's December Consumer Confidence 88.4 (last 100.7)
  • In news:
    • Honda signed an agreement to consider integration with Nissan and announced a buyback.
    • The Reserve Bank of Australia released its latest policy minutes, setting the stage for rate cuts if the economy continues evolving in line with or below expectations.
    • The Bank of Japan's minutes from the October meeting did not contain any surprises.
    • South Korea's Consumer Confidence fell at its fastest pace in 16 years in the December reading after President Yoon briefly declared martial law.
• Equity indices in Germany and Italy are closed for Christmas Eve while markets in France, Spain, and the U.K. will close early and will remain closed through Thursday. STOXX Europe 600: +0.4%, Germany's DAX: HOLIDAY, U.K.'s FTSE 100: +0.4%, France's CAC 40: +0.4%, Italy's FTSE MIB: HOLIDAY, Spain's IBEX 35: +0.2%
  • No data today
  • In news:
    • France named Eric Lombard as the new Finance Minister. Mr. Lombard pledged to cut the budget deficit without impacting growth.