Stock Market Update

The S&P 500 futures are up 26 points and are trading 0.5% above fair value, the Nasdaq 100 futures are up 165 points and are trading 0.8% above fair value, and the Dow Jones Industrial Average futures are 143 points and are trading 0.3% above fair value.

Contracts linked to the S&P 500, Nasdaq 100, and Dow industrials are higher. A strong response to earnings from Apple (AAPL), which is 4% higher ahead of the open, has supported the early bias. 

Treasury yields are little changed as participants wait for the release of the December Personal Income and Spending report at 8:30 ET, which includes the Fed's preferred inflation gauge (PCE Price Indexes). The 10-yr yield sits at 4.52% and the 2-yr yield is at 4.21%.

In corporate news:

• Apple (AAPL 247.02, +9.43, +4.0%): beats by $0.05, reports revs in-line; iPhones miss; services and wearables roughly in line; China revs decline; sees Q2 total revs in line with consensus
• Visa (V 349.72, +6.67, +1.9%): beats by $0.09, beats on revs; provides Q2 and FY25 guidance
• Chevron (CVX 153.30, -3.02, -1.9%): misses by $0.05, beats on revs; raises dividend 5% to $1.71/share
• Exxon Mobil (XOM 109.68, +0.11, +0.1%): beats by $0.12, misses on revs
• KLA Corp. (KLAC 770.20, +27.77, +3.7%): beats by $0.45, beats on revs; mid-point of MarQ EPS and revs guidance above consensus
• Intel (INTC 20.25, +0.24, +1.1%): beats by $0.01, beats on revs, DCAI segment revenue down 9%; guides Q1 EPS below consensus, revs below consensus
• Atlassian (TEAM 322.18, +55.23, +20.7%): beats by $0.21, beats on revs; guides MarQ revs above consensus; guides FY25 revs above consensus
• Deckers Outdoor (DECK 192.00, -31.11, -14.0%): beats by $0.42, beats on revs; guides FY25 EPS above consensus, revs in-line

Reviewing overnight developments:

• Equity indices in the Asia-Pacific region ended the week on a mostly higher note while markets in China and Hong Kong remained closed for Lunar New Year. Japan's Nikkei: +0.2% (-0.9% for the week), Hong Kong's Hang Seng: HOLIDAY (+0.8% for the week), China's Shanghai Composite: HOLIDAY (-0.1% for the week), India's Sensex: +1.0% (+1.7% for the week), South Korea's Kospi: -0.8% (-0.8% for the week), Australia's ASX All Ordinaries: +0.5% (+1.5% for the week).
  • In economic data:
    • Japan's January Tokyo CPI 3.4% yr/yr (last 3.0%) and Tokyo Core CPI 2.5% yr/yr, as expected (last 2.4%). December Retail Sales 3.7% yr/yr (expected 3.4%; last 2.8%), December Industrial Production 0.3% m/m (expected -0.1%; last -2.2%), December jobs/applications ratio 1.25, as expected (last 1.25), and December Unemployment Rate 2.4% (expected 2.5%; last 2.5%). December Housing Starts -2.5% yr/yr (expected -3.7%; last -1.8%) and Construction Orders 8.1% yr/yr (last -10.2%)
    • India's December Infrastructure Output 4.0% yr/yr (last 4.3%). December Bank Loan Growth 11.5% yr/yr (last 11.2%) and Deposit Growth 10.8% yr/yr (last 9.8%)
    • Singapore's December Bank Lending SGD835.0 bln (last SGD819.4 bln). Q4 Business Expectations 7.0 (last 10.0)
    • Australia's Q4 PPI 0.8% qtr/qtr (expected 1.0%; last 1.0%); 3.7% yr/yr (last 3.9%). December Housing Credit 0.5% m/m, as expected (last 0.5%)
  • In news:
    • The U.S. government is launching a probe to see if DeepSeek evaded restrictions on exports of advanced chips to China by purchasing them through Singapore.
    • Nissan plans to provide additional details on the potential merger with Honda by the middle of February.
• Major European indices are seeking a higher finish to the week with Italy's MIB (+0.4%) reaching its best level in 16 years. STOXX Europe 600: +0.4% (+2.1% week-to-date), Germany's DAX: +0.3% (+1.8% week-to-date), U.K.'s FTSE 100: +0.3% (+2.0% week-to-date), France's CAC 40: +0.7% (+0.8% week-to-date), Italy's FTSE MIB: +0.4% (+1.1% week-to-date), Spain's IBEX 35: +0.1% (+3.8% week-to-date).
  • In economic data:
    • Germany's December Retail Sales -1.6% m/m (expected 0.0%; last -0.1%); 1.8% yr/yr (expected 2.5%; last 2.9%). January Unemployment Change 11,000 (expected 14,000; last 10,000) and Unemployment Rate 6.2%, as expected (last 6.1%)
    • U.K.'s January Nationwide HPI 0.1% m/m (expected 0.3%; last 0.7%); 4.1% yr/yr (expected 4.3%; last 4.7%)
    • France's January CPI -0.1% m/m (expected 0.0%; last 0.2%); 1.4% yr/yr (expected 1.5%; last 1.3%). December PPI 1.0% m/m (last 3.7%); -3.8% yr/yr (last -4.7%)
    • Italy's December PPI 0.6% m/m (last 1.2%); 1.1% yr/yr (last -0.5%)
    • Spain's December Retail Sales 4.0% yr/yr (expected 0.5%; last 0.9%). November Current Account surplus EUR1.26 bln (last surplus of EUR4.93 bln)
    • Swiss December Retail Sales 2.6% yr/yr (expected 0.6%; last 1.4%)
  • In news:
    • Germany reported falling retail sales for January (-1.6% m/m) and an uptick in the Unemployment Rate (6.2% from 6.1%), continuing a string of weak data.
    • Germany will also report its flash CPI for January at 8:00 ET, which is expected to show that the year-over-year rate remained at 2.6% for the second consecutive month.
    • There is speculation that the European Central Bank will announce another rate cut in March and stop referring to its policy as "restrictive."
    • The European Central Bank's December Survey of Professional Forecasters raised the harmonized inflation forecast for the eurozone to 2.1% from 1.9% and cut the GDP growth forecast to 1.0% from 1.2%.