Stock Market Update

The S&P 500 futures are up ten points and are trading 0.2% above fair value, the Nasdaq 100 futures are down two points and are trading fractionally below fair value, and the Dow Jones Industrial Average futures are up 47 points and are trading 0.1% above fair value.

Early trading has a mixed vibe as participants digest another big batch of earnings news. Qualcomm (QCOM) and Ford (F) are some notable names trading lower ahead of the open in response to earnings news while Eli Lilly (LLY) sports a pre-open gain.

Participants also receive the Q4 preliminary productivity and unit labor costs figures ahead of the open, along with weekly jobless claims.

In other news, the Bank of England announced a 25-basis point rate cut to 4.50%, as expected.

In corporate news:

• Qualcomm (QCOM 168.50, -7.36, -4.2%): beats by $0.43, beats on revs; guides Q2 EPS above consensus, revs in-line; on conference call said it is pleased that the recently launched Samsung (SSNLF) Galaxy S25 series of smartphones will be powered by the Snapdragon 8 Elite for Galaxy globally
• Eli Lilly (LLY 850.00, +7.82, +0.9%): beats by $0.31, reports revs in-line; guides FY25 EPS in-line, revs in-line
• Arm Holdings plc (ARM 167.57, -5.69, -3.3%): beats by GBP0.05, beats on revs; guides Q4 EPS in-line, revs in-line
• Ford (F 9.46, -0.55, -5.6%): beats by $0.05, misses on revs; guides Q1 adjusted EBIT to be roughly breakeven; A few weeks of tariffs are manageable given the flow of products
• Honeywell (HON 219.26, -3.09, -1.4%): beats by $0.15, beats on revs; guides FY25 EPS below consensus, revs below consensus; announces intent to separate Automation and Aerospace segments, enabling the creation of three industry-leading companies
• Skyworks (SWKS 61.61, -25.37, -29.1%): beats by $0.03, reports revs in-line; guides Q2 EPS in-line, revs in-line; authorizes up to $2.0 bln for repurchases; appoints Philip Brace as President and CEO, effective Feb 17; Christine King appointed Chairman of the board
• Cognizant Tech (CTSH 82.01, -1.59, -1.9): beats by $0.09, reports revs in-line; guides Q1 revs in-line; guides FY25 EPS in-line, revs in-line; raises its quarterly dividend by 3% to $0.31

Reviewing overnight developments:

• Equity indices in the Asia-Pacific region ended Thursday on a higher note. Japan's Nikkei: +0.6%, Hong Kong's Hang Seng: +1.4%, China's Shanghai Composite: +1.3%, India's Sensex: -0.3%, South Korea's Kospi: +1.1%, Australia's ASX All Ordinaries: +1.2%.
  • In economic data:
    • South Korea's December Current Account surplus $12.37 bln (last surplus of $10.05 bln)
    • Australia's December trade surplus AUD5.085 bln (expected surplus of AUD6.520 bln; last surplus of AUD6.792 bln). December Imports 5.9% m/m (last 1.4%) and Exports 1.1% m/m (last 4.2%). Q4 NAB Quarterly Business Confidence -4 (last -2)
  • In news:
    • Bank of Japan policymaker Tamura said that the neutral rate is at least around 1.0% and that the central bank needs to raise its policy rate to that level by the second half of this year.
    • Japan's Prime Minister Ishiba will meet with President Trump this weekend.
• Major European indices trade on a higher note with the U.K.'s FTSE (+1.5%) leading after the Bank of England announced a 25-basis point rate cut to 4.50%, which was expected. STOXX Europe 600: +0.8%, Germany's DAX: +1.0%, U.K.'s FTSE 100: +1.5%, France's CAC 40: +0.9%, Italy's FTSE MIB: +0.7%, Spain's IBEX 35: +0.8%.
  • In economic data:
    • Eurozone's December Retail Sales -0.2% m/m (expected -0.1%; last 0.0%); 1.9% yr/yr, as expected (last 1.6%)
    • Germany's December Factory Orders 6.9% m/m (expected 1.9%; last -5.4%)
    • Swiss January Unemployment Rate 2.7%, as expected (last 2.7%)
  • In news:
    • British Prime Minister Starmer is reportedly seeking ways to boost his party's popularity.
    • Shipper Maersk reported solid results for Q4 but also said it does not expect the normalization of routes through the Red Sea in the near term.