Stock Market Update

[BRIEFING.COM] The S&P 500 futures are up 45 points and are trading 0.8% above fair value, the Nasdaq 100 futures are up 217 points and are trading 1.0% above fair value, and the Dow Jones Industrial Average futures are up 162 points and are trading 0.4% above fair value.

Equity futures indicate a higher open for the major indices, boosted by pre-open gains in mega caps and chipmakers. The early strength in the spaces follows impressive Q4 revenues from Foxconn and plans announced Friday by Microsoft to spend approximately $80 billion in 2025 to build out AI-enabled data centers.

The price action in Treasuries has also contributed to the positive bias this morning. The 10-yr yield is down one basis point to 4.59% and the 2-yr yield is down two basis points to 4.26%.

Market participants receive the following economic data today: December S&P Global US Services PMI - Final at 9:45 ET and November Factory Orders at 10:00 ET.

In corporate news:

• Uber (UBER 68.08, +3.49, +5.4%) and Lyft (LYFT 14.92, +0.65, +4.6%): are offering new self driving features, according to WSJ
• Boeing (BA 172.84, +2.94, +1.7%): upgraded to Overweight from Equal Weight at Barclays
• Salesforce (CRM 331.39, -1.51, -0.5%): downgraded to Sell from Neutral at Guggenheim
• Intel's (INTC 20.85, +0.29, +1.4%): problems could be worse than people thought
• U.S. Steel (X 31.59, +1.12, +3.7%): Nippon Steel and U. S. Steel confirm multiple lawsuits in response to wrongful interference with the proposed acquisition of U. S. Steel (

Reviewing overnight developments:

• Equity indices in the Asia-Pacific region were mostly lower Monday. Japan's Nikkei: -1.5%, Hong Kong's Hang Seng: -0.4%, China's Shanghai Composite: -0.1%, India's Sensex: -1.6%. South Korea's Kospi: +1.9%, Australia's All Ordinaries: +0.1%,
  • In economic data:
    • China's December Caixin Services PMI 52.2 (expected 51.7; last 51.5)
    • Japan's December au Jibun Bank Services PMI 50.9 (expected 51.4; last 50.5)
    • Hong Kong's December S&P Global Manufacturing PMI 51.1 (last 51.2)
    • Australia's December Judo Bank Services PMI 50.8 (last 50.5)
    • India's December S&P Global Services PMI 59.3 (expected 60.8; last 58.4)
  • In news:
    • Japan's Nikkei (-1.5%) returned from an extended break with a downside bias, as BOJ Governor Ueda reiterated that rates will increase if the economy continues to improve.
    • Japan's 10-yr government bond yield hit its highest level (1.12%) since July 2011.
    • Chinese markets remained weak despite policy support jawboning from officials and a better-than-expected December Caixin Services PMI reading that was the highest since May 2024.
    • Added attention on a weakening yuan and Chinese government bond yields hitting record lows with press reports suggesting the PBOC has the tool kit necessary to respond to the yuan's weakness.
    • South Korea's Kospi (+1.9%) was the winning standout, furthering Friday's rally that followed the government's pledge to support the market if volatility increased.
• Major European indices are in rally mode to begin the week. STOXX Europe 600: +0.8%, Germany's DAX: +1.4%, UK's FTSE 100: +0.1%, France's CAC 40: +2.1%, Italy's FTSE MIB: +1.5%, Spain's IBEX 35: +0.8%.
  • In economic data:
    • Eurozone's December HCOB Services PMI 51.6 (expected 51.4; last 49.5) and Composite PMI 49.6 (expected 49.5; last 48.3); January Sentix Investor Confidence -17.7 (expected -17.7; last -17.5)
    • Germany's December HCOB Services PMI 51.2 (expected 51.0; last 49.3) and Composite PMI 48.0 (expected 47.8; last 47.2); December Hesse CPI 1.8% m/m (last -0.3%) and 2.7% yr/yr (last 2.0%)
    • France's December HCOB Services PMI 49.3 (expected 48.2; last 46.9) and Composite PMI 47.5 (expected 46.7; last 45.9)
    • Italy's December HCOB Services PMI 50.7 (expected 50.0; last 49.2) and Composite PMI 49.7 (last 47.7)
    • Spain's December HCOB Services PMI 57.3 (expected 54.1; last 53.1)
    • UK's December S&P Global Services PMI 51.1 (expected 51.4; last 50.8) and Composite PMI 50.4 (expected 50.5; last 50.5)
  • In news:
    • Market was enthused by a batch of final Services PMI readings for December that were better than expected, Wall Street's bounce on Friday, and AI enthusiasm that was fueled by Foxconn's impressive Q4 revenues and Microsoft's plan (announced Friday) to spend approximately $80 billion in 2025 to build out AI-enabled data centers.
    • Markets are also benefiting from some buy-the-dip interest.
    • European currencies are seeing a rebound trade from a technically oversold position that drew some added energy from the Services PMI readings that had traders questioning if the ECB will be as quick to cut rates as some had previously thought. EUR/USD +1.0% to 1.0404 and GBP/USD +0.9% to 1.2535.