Stock Market Update

The S&P 500 futures are flat and are trading in-line with fair value, the Nasdaq 100 futures are up 60 points and are trading 0.3% above fair value, and the Dow Jones Industrial Average futures are down 19 points and are trading 0.1% below fair value.

Early trading features mixed action. Contracts linked to the Nasdaq 100 are higher while futures tied to the S&P 500 and Dow industrials are little changed.

Participants are in wait-and-see mode ahead of earnings news from Microsoft (MSFT), Meta Platforms (META), and Tesla (TSLA) after today's close, along with Apple (AAPL) after Thursday's close.

The hesitation is also related to today's FOMC decision at 2:00 p.m. ET, followed by Fed Chair Powell's press conference at 2:30 p.m. ET. The committee is expected to keep the target range for the fed fund rate at 4.25-4.50%, so more attention will be paid to Fed Chair Powell's tone and remarks. 

In corporate news:

• Starbucks (SBUX 102.67, +2.26, +2.3%): beats by $0.02, reports revs in-line, global comps fell by -4%; EPS expected to be the lowest in Q2
• T-Mobile US (TMUS 239.02, +17.88, +8.1%): beats by $0.28, beats on revs
• ASML (ASML 722.60, +39.27, +5.7%): beats by €0.13, beats on revs; guides Q1 revs above consensus; reaffirms FY25 revs guidance
• Frontier Group Holdings (ULCC 7.90, +0.12, +1.5%): confirms that it has had preliminary confidential discussions with Spirit and has made a proposal to combine with Spirit (SAVE
• Stryker (SYK 385.75, -9.40, -2.4%): beats by $0.14, beats on revs; guides FY25 EPS in-line; announces that Glenn S. Boehnlein will retire from his role as Vice President, Chief Financial Officer; announces a definitive agreement to sell its U.S. spinal implants business to Viscogliosi Brothers, a family-owned investment firm specializing in the neuro-musculoskeletal space, to create a newly formed company called VB Spine
• Danaher (DHR 233.75, -14.09, -5.7%): misses by $0.02, beats on revs
• F5 Networks (FFIV 306,20, +36.48, +13.5%): beats by $0.48, beats on revs; guides Q2 EPS below consensus, revs above consensus; raises FY25 EPS and revenue guidance
• Qorvo (QRVO 80.24, -5.54, -6.5%): beats by $0.40, beats on revs; guides MarQ EPS above consensus, revs in-line

Reviewing overnight developments:

• Equity indices in the Asia-Pacific region ended the midweek session on a higher note while markets in China, Hong Kong, South Korea, and Singapore were closed for holidays. Japan's Nikkei: +1.0%, Hong Kong's Hang Seng: HOLIDAY, China's, Shanghai Composite: HOLIDAY, India's Sensex: +0.8%, South Korea's Kospi: HOLIDAY, Australia's ASX All Ordinaries: +0.7%.
  • In economic data:
    • Japan's January Household Confidence 35.2 (expected 36.6; last 36.2)
    • Australia's Q4 CPI 0.2% qtr/qtr (expected 0.3%; last 0.2%); 2.4% yr/yr (expected 2.5%; last 2.8%)
  • In news:
    • Japan's Government Pension Investment Fund will be allowed to bid directly in bond auctions.
    • Japan's Household Confidence for January (35.2) fell to its lowest level since September 2023.
    • Expectations for a February rate cut from the Reserve Bank of Australia are growing after the release of a cooler than expected CPI report for Q4.
• Major European indices trade on a mostly higher note with a rate cut from the European Central Bank expected to take place tomorrow. STOXX Europe 600: +0.6%, Germany's DAX: +0.8%, 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:
    • Eurozone's December Private Sector Loans 1.1% yr/yr (expected 1.0%; last 0.9%) and loans to nonfinancials 1.5% yr/yr (last 1.0%)
    • Germany's February GfK Consumer Climate -22.4 (expected -20.5; last -21.4)
    • Italy's January Business Confidence 86.8 (expected 85.5; last 85.9) and Consumer Confidence 98.2 (expected 96.0; last 96.3)
    • Spain's Q4 GDP 0.8% qtr/qtr (expected 0.6%; last 0.8%); 3.5% yr/yr (expected 3.2%; last 3.3%)
    • Swiss January ZEW Expectations 17.7 (last -20.0)
  • In news:
    • There is renewed uncertainty over the likelihood of France's government reaching a budget agreement after Prime Minister Bayrou made comments about immigration that the Socialist party found displeasing.
    • Spain's GDP growth beat Q4 expectations.
    • Sweden's Riksbank lowered its policy rate by 25 basis points to 2.25% and indicated plans for more easing.