Stock Market Update

The S&P 500 futures are up ten points and are trading 0.2% above fair value, the Nasdaq 100 futures are up 40 points and are trading 0.2% above fair value, and the Dow Jones Industrial Average futures are up two points and are trading in-line with fair value.

Contracts linked to the S&P 500, Nasdaq 100, and Dow industrials are higher after yesterday's AI-led slide. Indicated opening gains are slim compared to the scope of yesterday's losses.

Earnings continue to roll in with results from Boeing (BA), RTX (RTX), and Royal Caribbean (RCL) garnering positive pre-open responses. General Motors (GM), and JetBlue Airways (JBLU) are among the premarket losers after reporting earnings results.

Treasury yields are higher after sliding in response to the stock market scare yesterday. The 10-yr yield is up three basis points to 4.56%.

Political news still dominates headlines after President Trump said he wants tariffs larger than 2.5% on foreign pharmaceuticals, semiconductors, and metals, according to Bloomberg.

In corporate news:

• Boeing (BA 175.99, +0.83, +0.5%): misses by $2.68, reports revs in-line with last week's guidance; impacted by previously announced IAM work stoppage
• General Motors (GM 54.85, -0.07, -0.1%): beats by $0.07, beats on revs; guides FY25 EPS above consensus
• NVIDIA (NVDA 121.03, +2.46, +2.1%): higher ahead of the open after huge loss yesterday
• Nucor (NUE 122.00, +0.03, +0.03%): beats by $0.58, beats on revs; market conditions are starting to improve
• RTX (RTX 128.00, +2.95, +2.4%): beats by $0.16, beats on revs; guides FY25 EPS in-line, revs below consensus
• SAP SE (SAP 273,20, -2.40, -0.9%): beats by €0.07, beats on revs
• Royal Caribbean (RCL 248.80, +11.88, +4.9%): beats by $0.13, reports revs in-line; guides Q1 EPS above consensus; guides FY25 EPS in-line
• JetBlue Airways (JBLU 7.37, -0.72, -8.9%): beats by $0.08, reports revs in-line

Reviewing overnight developments:

• Equity indices in the Asia-Pacific region ended Tuesday on a mixed note with volume on the light side due to holiday closures in China and South Korea, and an early close in Hong Kong. Japan's Nikkei: -1.4%, Hong Kong's Hang Seng: +0.1%, China's Shanghai Composite: HOLIDAY, India's Sensex: +0.7%, South Korea's Kospi: HOLIDAY, Australia's ASX All Ordinaries: -0.2%.
  • In economic data:
    • Japan's November BoJ Core CPI 1.9% yr/yr (expected 1.7%; last 1.7%) and December Corporate Services Price Index 2.9% yr/yr (expected 3.2%; last 3.0%)
    • Hong Kong's December M3 Money Supply 2.8% (last 2.4%)
    • Australia's December NAB Business Survey 6 (last 2) and Business Confidence -2 (last -3)
  • In news:
    • Japan's opposition is threatening to block a budget if Prime Minister Ishiba does not agree to a higher tax-free allowance.
    • China Vanke will receive state support after two executives resigned. The company expects to record a $6.2 bln net loss for 2024.
• Major European indices trade in the green. STOXX Europe 600: +0.5%, Germany's DAX: +0.6%, U.K.'s FTSE 100: +0.4%, France's CAC 40: +0.3%, Italy's FTSE MIB: +0.6%, Spain's IBEX 35: +0.9%.
  • In economic data:
    • France's January Consumer Confidence 92 (expected 90; last 89)
    • Spain's Q4 Unemployment Rate 10.6% (expected 11.1%; last 11.2%)
  • In news:
    • The European Central Bank's Q4 lending survey showed a larger than expected tightening in corporate credit with more tightening expected in 2025.
    • British Prime Minister Starmer repeated that boosting growth is a top priority for his government.
    • SAP raised its guidance for fiscal 2025.
    • Swiss National Bank Chairman Schlegel said that inflation is expected to be low this year and that rates could go negative if needed.