Stock Market Update

Equity futures point to a flat opening after stocks pulled back from last week's record highs in yesterday's trade. Mega-cap tech names finished mostly lower, though they saw improvements late in the session, which helped the major averages finish well off of session lows. Metal prices also pulled back considerably from record high levels. 

The action came on lower-than-average volume and few directional drivers. There was, however, a myriad of geopolitical headlines, which seem to be stoking some tensions again this morning. Reuters reported that China has fired missiles into the waters off of Taiwan. Separately, NBC News reports that President Trump has issued new warnings against Iran and Hamas, with Iran threatening a "harsh" response. 

While corporate news flow remains light, the market will have several data and policy points to assess today. Most notably, the October Job Opening and Labor Turnover report will be released at 10:00 a.m. ET, and the December FOMC minutes will be released at 2:00 p.m. ET. 

In corporate news: 

• China is aiming to mandate 50% domestic equipment for producers of chips, according to Reuters. 
• Meta Platforms (META 657.75, -0.94, -0.1%) is set to acquire the Singapore-based AI startup Manus, according to The Wall Street Journal.
• Tesla (TSLA 461.96, +2.32, +0.5%) published a compilation of analyst predictions for vehicle deliveries, with the current quarters estimates projected to come in lighter than previous ones, according to Bloomberg. 

Reviewing overnight developments:

Equity indices in the Asia-Pacific region had a mostly lower showing on Tuesday. Japan's Nikkei: -0.4%, Hong Kong's Hang Seng: +0.9%, China's Shanghai Composite: UNCH, India's Sensex: UNCH, South Korea's Kospi: -0.2%, Australia's ASX All Ordinaries: -0.1%.

In news:

• South Korea's Retail Sales (-3.3% m/m) for November fell at their fastest pace in nearly two years due to lower sales of food and apparel.
• Separately, South Korea's finance ministry is expected to present a roadmap for the country's inclusion in the MSCI Developed Market Index early next year.
• Samsung and SK Hynix received U.S. approval to ship chip fabrication tools to China and there were reports that the U.S. may implement an annual system for granting these licenses.
• China's offshore yuan reached its strongest level against the dollar in 15 months.
• Markets in Japan and South Korea will be closed entirely tomorrow while markets in Australia, New Zealand, and Hong Kong will close early.

In economic data:

• South Korea's November Industrial Production 0.6% m/m (expected 2.2%; last -4.2%); -1.4% yr/yr (expected 3.0%; last -8.2%).November Retail Sales -3.3% m/m (last 3.6%) and November Service Sector Output 0.7% m/m (last -0.7%)

Major European indices trade in the green ahead of tomorrow's full day closures in Germany, Switzerland, and Italy, and early closures scheduled for the U.K., Spain, and France. STOXX Europe 600: +0.6%, Germany's DAX: +0.6%, U.K.'s FTSE 100: +0.5%, France's CAC 40: +0.5%, Italy's FTSE MIB: +1.1%, Spain's IBEX 35: +0.7%.

In news:

• Spain reported strong Retail Sales growth for November (6.0% yr/yr), combined with a decelerating CPI for December (to 2.9% from 3.0%).
• Sweden's Riksbank noted in its Minutes from the December meeting that policy should remain at its current level for some time, echoing the European Central Bank's view.

In economic data:

• Spain's December CPI 0.3% m/m (last 0.2%); 2.9% yr/yr (expected 2.8%; last 3.0%). December Core CPI 2.6% yr/yr (last 2.6%). November Retail Sales 6.0% yr/yr (last 3.9%) and October Current Account surplus EUR7.18 bln (last surplus of EUR1.87 bln)
• Swiss December KOF Leading Indicators 103.4 (expected 101.5; last 101.7)