Stock Market Update

The S&P 500 futures are down one point and are trading in-line with fair value, the Nasdaq 100 futures are down three points and are trading fractionally below fair value, and the Dow Jones Industrial Average futures are up 20 points and are trading 0.1% above fair value.

Early trading features a mixed vibe in front of the January Employment Situation report at 8:30 ET. Treasury yields are little changed before the report. The 2-yr yield is two basis points higher at 4.23% and the 10-yr yield is unchanged at 4.44%.

Amazon.com (AMZN) shares are 3% lower ahead of the open after issuing below-consensus Q1 revenue guidance and saying that AWS growth is expected to be lumpy over the next few years.

In corporate news:

• Amazon (AMZN 231.44, -7.37, -3.1%): beats by $0.37, reports revs in-line, reports operating income above guidance; guides Q1 revs below consensus; Expects AWS growth to be lumpy over the next few years
• Affirm (AFRM 70.86, +9.11, +14.8%): beats by $0.39, beats on revs; guides Q3 revs in-line; guides Q4 (Jun) revs in-line
• Pinterest (PINS 40.23, +6.54, +19.8%): misses by $0.08, beats on revs; guides Q1 revs above consensus
• e.l.f. Beauty (ELF 65.63, -22.86, -25.8%): misses by $0.02, beats on revs; guides FY25 EPS below consensus, revs below consensus
• Expedia Group (EXPE 191.20, +18.63, +10.8%): beats by $0.30, beats on revs, booked room nights grew 12%; reinstates quarterly dividend; B2B business was a standout as bookings growth accelerated in Q4
• Fortinet (FTNT 111.02, +6.30, +6.0%): beats by $0.13, beats on revs; guides Q1 EPS in-line, revs in-line; guides FY25 EPS in-line, revs above consensus

Reviewing overnight developments:

• Equity indices in the Asia-Pacific region ended the week on a mixed note. Japan's Nikkei: -0.7% (-2.0% for the week), Hong Kong's Hang Seng: +1.2% (+4.5% for the week), China's Shanghai Composite: +1.0% (+1.6% for the week), India's Sensex: -0.3% (+0.5% for the week), South Korea's Kospi: -0.6% (+0.2% for the week), Australia's ASX All Ordinaries: -0.1% (-0.1% for the week).
  • In economic data:
    • Japan's December Household Spending 2.3% m/m (expected -0.5%; last 0.4%); 2.7% yr/yr (expected 0.2%; last -0.4%). December Leading Index 108.9 (expected 108.2; last 107.5) and Coincident Indicator 1.4% m/m (last -1.4%)
  • In news:
    • Japan reported much stronger than expected Household Spending for December (2.3%; expected -0.5%), contributing to expectations for more rate hikes from the Bank of Japan.
    • Japan's Prime Minister Ishiba is expected to discuss joint AI and chip development during a meeting with President Trump.
    • The Reserve Bank of India lowered its policy rate by 25 basis points to 6.25%, as expected.
• Major European indices trade near their flat lines. STOXX Europe 600: UNCH (+1.0% week-to-date), Germany's DAX: +0.1% (+0.9% week-to-date), U.K.'s FTSE 100: -0.3% (+0.3% week-to-date), France's CAC 40: -0.1% (+0.7% week-to-date), Italy's FTSE MIB: -0.2% (+1.6% week-to-date), Spain's IBEX 35: -0.3% (+2.7% week-to-date).
  • In economic data:
    • Germany's December trade surplus EUR20.7 bln (expected surplus of EUR17.0 bln; last surplus of EUR19.2 bln). December Imports 2.1% m/m (expected 1.8%; last -2.7%) and Exports 2.9% m/m (expected -0.6%; last 2.3%). December Industrial Production -2.4% m/m (expected -0.7%; last 1.3%); -3.1% yr/yr (last -3.0%)
    • U.K.'s January Halifax House Price Index 0.7% m/m (expected 0.4%; last -0.2%); 3.0% yr/yr (last 3.4%)
    • France's December trade deficit EUR3.9 bln (expected deficit of EUR5.3 bln; last deficit of EUR6.3 bln) and December Current Account surplus EUR2.4 bln (last deficit of EUR1.2 bln). Q4 Nonfarm Payrolls -0.2% qtr/qtr (expected -0.1%; last 0.1%) o Spain's December Industrial Production 2.1% yr/yr (expected 0.5%; last -0.1%)
    • Swiss Q1 SECO Consumer Climate -21 (expected -31; last -27)