Stock Market Update

Equity futures point to a modestly higher opening this morning after yesterday's action saw the major averages post losses amid a sharp cryptocurrency sell-off in the first session of December. 

The energy sector was the only real winner sector-wise yesterday, though the technology sector shed a 1.3% early loss, which substantially improved the standing of the major averages. 

Mega-cap tech names are mostly higher this morning against a quiet backdrop of news flow. The market's expectations for a December rate continue to hover just under 90% (87.2% to be exact), according to the CME FedWatch tool, and there are no economic data releases on the calendar this morning. 

While the market received just a slim batch of earnings reports after the close yesterday, several tech stocks delivered notable moves in response. 

In corporate news:

• Credo Technology Group (CRDO 199.10, +27.97, +16.3%) beat EPS expectations by $0.18, beat revenue expectations, and guided Q3 revenues above consensus.
• Disney (DIS 106.85, +0.08, +0.07) is likely to choose a new CEO from within the company, according to The Wall Street Journal. 
• OpenAI CEO Sam Altman told employees he is declaring a "code red" effort to improve ChatGPT amid competition from Google (GOOG 316.35, +1.23, +0.4%), according to The Wall Street Journal.
• MongoDB (MDB 404.50, +75.63, +23.00) beat EPS expectations by $0.51, beat revenue expectations, and guided Q4 EPS and revenues above consensus. The company reported Atlas revenue growth of 30%. 

Reviewing overnight developments:

Equity indices in the Asia-Pacific region ended Tuesday on a mostly higher note. Japan's Nikkei: UNCH, Hong Kong's Hang Seng: +0.2%, China's Shanghai Composite: -0.4%, India's Sensex: -0.6%, South Korea's Kospi: +1.9%, Australia's ASX All Ordinaries: +0.1%.

In news:

• Hyundai, Kia, and SK Hynix had a strong showing after U.S. officials confirmed that South Korea's tariff rate has been reduced to 15%.
• Consumer confidence in Japan reached its highest level since April 2024 in the November reading.
• China Securities Journal reported that local Chinese governments are buying stakes in listed companies.
• Honda indicated plans to reorganize its presence in China amid recent political tension between leaders from Japan and China.

In economic data:

• Japan's November Monetary Base -8.5% yr/yr, as expected (last -7.8%) and November Household Confidence 37.5 (expected 36.2; last 35.8)
• South Korea's November CPI -0.2% m/m (expected -0.3%; last 0.3%); 2.4% yr/yr (last 2.4%)
• Australia's October Building Approvals -6.4% m/m (expected -4.3%; last 11.1%); -1.8% yr/yr (expected 12.4%; last 14.9%). Q3 Current Account deficit AUD16.6 bln (expected deficit of AUD13.2 bln; last deficit of AUD16.2 bln). Q3 Net Exports Contribution -0.1% qtr/qtr (last 0.1%). October Private House Approvals -2.1% (last 3.2%)
• New Zealand's Q3 Terms of Trade Index -2.1% qtr/qtr (expected 0.3%; last 4.2%)

Major European indices trade in the green. STOXX Europe 600: +0.3%, Germany's DAX: +0.4%, U.K.'s FTSE 100: +0.2%, France's CAC 40: +0.3%, Italy's FTSE MIB: +0.4%, Spain's IBEX 35: +0.9%.

In news:

• British investors have some concerns that the budget plan that was announced last week will not be realized since it would require additional cuts leading into elections expected in 2029.
• The Bank of England lowered the systematic capital buffer to 13% from 14% after the latest round of bank stress tests.The Countercyclical Capital Buffer was maintained at 2%.
• European Central Bank policymaker Kocher said that slight inflationary or disinflationary deviations from target should not trigger policy changes, echoing recent comments from officials who also suggested that policy is in a good place.

In economic data:

• Eurozone's flash November CPI -0.3% m/m (last 0.2%); 2.2% yr/yr (expected 2.1%; last 2.1%). November Core CPI -0.5% m/m (last 0.3%); 2.4% yr/yr, as expected (last 2.4%). October Unemployment Rate 6.4% (expected 6.3%; last 6.4%)
• U.K.'s November Nationwide HPI 0.3% m/m (expected 0.0%; last 0.2%); 1.8% yr/yr (expected 1.4%; last 2.4%)
• France's October government budget balance -EUR136.2 bln (last deficit of EUR155.4 bln)
• Spain's November Unemployment Change -18,800 (expected -12,400; last 22,100)
• Italy's October Unemployment Rate 6.0% (expected 6.1%; last 6.2%). October PPI -0.2% m/m (last 0.2%); 0.1% yr/yr (last 1.1%)