Stock Market Update

The S&P 500 futures are up 26 points and are trading 0.4% above fair value, the Nasdaq 100 futures are up 70 points and are trading 0.3% above fair value, and the Dow Jones Industrial Average futures are up 298 points and are trading 0.7% above fair value.

The stock market is poised for a higher open driven by the ongoing inclination to buy any dip following Friday's retreat. 

Treasuries settled with solid gains on Friday in response to growth concerns after soft economic data. There's been some selling interest in Treasuries this morning, unwinding some of Friday's action. The 10-yr yield is up three basis points to 4.45% and the 2-yr yield is up three basis points to 4.22%.

There is no US economic data of note today.

In corporate news:

• Apple (AAPL 243.93, -1.62, -0.7%): will spend more than $500 billion in the U.S. over the next four years; will work with manufacturing partners to begin production of servers in Houston, TX later this year; President Trump acknowledges Apple's $500 bln investment, but makes no mention of what he will do with China tariffs
• Microsoft (MSFT 408.33, +0.12, +0.02%): quantum claims are being questioned by physicists, according to WSJ
• Alibaba (BABA 138.88, -4.87, -3.4%): aiming to spend $53 bln on artificial intelligence, according to Bloomberg
• Domino's Pizza (DPZ 442.88, -19.49, -4.2%): misses by $0.01, misses on revs; raises dividend

Reviewing overnight developments:

• Equity indices in the Asia-Pacific region began the week on a lower note while Japan's Nikkei was closed for Emperor's Birthday. Japan's Nikkei: HOLIDAY, Hong Kong's Hang Seng: -0.6%, China's Shanghai Composite: -0.2%, India's Sensex: -1.1%, South Korea's Kospi: -0.4%, Australia's ASX All Ordinaries: -0.1%.
  • In economic data:
    • Singapore's January CPI -0.8% m/m (last 0.3%); 1.2% yr/yr (expected 2.2%; last 1.5%). January Core CPI 0.8% yr/yr (expected 1.5%; last 1.7%)
    • New Zealand's Q4 Retail Sales 0.9% qtr/qtr (expected 0.5%; last 0.0%); 1.4% qtr/qtr (expected 0.2%; last -0.6%)
  • In news:
    • Former Bank of Japan official Shirai said that the Bank of Japan could raise its policy rate to 0.75% in March if the U.S. imposes tariffs.
    • The Trump administration is reportedly planning to impose large fees on ships owned or built in China.
    • New Zealand reported solid Retail Sales for Q4, fueling hopes that the recession has ended.
• Major European indices trade on a mostly higher note while France's CAC (-0.3%) underperforms. STOXX Europe 600: UNCH, Germany's DAX: +0.8%, U.K.'s FTSE 100: UNCH, France's CAC 40: -0.3%, Italy's FTSE MIB: +0.2%, Spain's IBEX 35: +0.5%.
  • In economic data:
    • Eurozone's January CPI -0.3% m/m, as expected (last 0.4%); 2.5% yr/yr, as expected (last 2.4%). January Core CPI -0.9% m/m (expected -1.0%; last 0.5%); 2.7% yr/yr, as expected (last 2.7%)
    • Germany's February ifo Business Climate Index 85.2 (expected 85.9; last 85.2). February Current Assessment 85.0 (expected 86.5; last 86.0) and Business Expectations 85.4 (expected 85.2; last 84.3)
  • In news:
    • Germany's snap election resulted in CDU/CSU receiving nearly 29.0% of the vote, followed by 20.8% for AfD, and 16.4% for Chancellor Scholz's SPD.
    • CDU/CSU will reportedly seek to form a coalition with SPD.
    • European Central Bank policymaker Wunsch warned that the ECB could "sleepwalk" into too many rate cuts.