Stock Market Update

The S&P 500 futures are down 19 points and are trading 0.3% below fair value, the Nasdaq 100 futures are down 75 points and are trading 0.3% below fair value, and the Dow Jones Industrial Average futures are down 139 points and are trading 0.3% below fair value.

Stock futures indicate a lower open as participants return from the holiday break. Losses in the mega cap space have contributed to the negative bias, along with rising market rates. The 10-yr yield is four basis points higher than Tuesday at 4.63% and the 2-yr yield is two basis points higher at 4.36%. 

Market participants receive the weekly jobless claims report at 8:30 ET. 

In corporate news:

• DXC Technology (DXC 20.22, -0.28, -1.4%): operating system issue caused American Airlines (AAL) one hour ground stop, according to Reuters
• KKR (KKR 152.99, +0.41, +0.3%): and Bain aiming to bid for Seven & I Holdings (SVNDY) assets, according to Reuters
• U.S. Steel (X 32.18, +0.21, +0.7%): Nippon Steel extends closing date of US Steel (X) acquisition to Q1 of 2025
• Alibaba (BABA 85.87, +0.35, +0.4%): aiming to merge South Korean unit with E-Mart's e-commerce platform, according to Bloomberg

Reviewing overnight developments: 

• Equity indices in the Asia-Pacific region were mostly higher, although some markets, most notably Hong Kong and Australia, were closed for holiday. Japan's Nikkei: +1.1%, Hong Kong's Hang Seng: closed for holiday, China's Shanghai Composite: +0.1%, India's Sensex: +0.1%, South Korea's Kospi: -0.4%, Australia's All Ordinaries: closed for holiday.
  • In economic data:
    • Japan's October Leading Index 0.2% m/m (-0.3% expected; last 2.2%); November Construction Orders -10.2% yr/yr (last 44.6%)
    • Singapore's November Industrial Production -0.4% m/m (last 0.1%)
  • In news:
    • Japan's Nikkei (+1.1%) outperformed on the back of automakers, which were helped by the weakening yen and Toyota Motor's news that it is targeting an ROE of 20% by 2030.
    • South Korea's opposition party says it will attempt to impeach acting president Han Duck-soo, driving the Korean won to its lowest level against dollar since the global financial crisis.
    • The PBOC left its MLF rate unchanged at 2.00%, as expected, and withdrew a net CNY1.15 trillion that was the largest withdrawal since 2014, according to Bloomberg.
• Major European indices were closed for Boxing Day. STOXX Europe 600: closed for holiday, Germany's DAX: closed for holiday, U.K.'s FTSE 100: closed for holiday, France's CAC 40: closed for holiday, Italy's FTSE MIB: closed for holiday, Spain's IBEX 35: closed for holiday.
  • In economic data:
    • Spain's November PPI 0.9% yr/yr (last -3.9%)
    • France's November Job Seekers Total 2935.0K (last 2981.5K)