Stock Market Update

Equity futures point to a modestly lower open this morning as investors assess a batch of earnings reports while awaiting key inflation data this morning. 

Stocks notched broad-based modest gains yesterday despite some early weakness, sending the S&P 500 to fresh record highs while the DJIA notched a record close. 

This morning's 8:30 a.m. release of the December CPI (Briefing.com consensus 0.3%) is viewed as the most important catalyst for the market this week. With the market not pricing in another rate cut until June (according to the CME FedWatch tool), a hotter print will likely reinforce this delay, while a softer-than-expected surprise could open the conversation to an earlier cut. 

Futures are largely drifting sideways ahead of the key release, though JPMorgan Chase (JPM 325.01, +0.5%, +0.2%) kicked off the big bank's earnings reports this morning. 

Geopolitical tensions remain high, with The New York Times reporting that Pentagon officials will present President Trump with a wider range of Iran attack options than previously thought.

The December NFIB Small Business Optimism Index registered at 99.5, from a prior level of 99.0. 

In corporate news:

• Delta Air Lines (DAL 67.46, -3.57, -5.0%) beat EPS expectations by $0.02, beat revenue expectations, guided Q1 EPS in-line with revenues in-line, and guided FY26 EPS in-line.
• JPMorgan Chase (JPM 325.01, +0.5%, +0.2%) missed EPS expectations by $0.22 due to a one-time, preannounced charge, though its adjusted EPS of $5.23 per share beat expectations. The company reported revenues in-line. 
• Taiwan Semiconductor (TSM 332.53 +0.76, +0.2%) is planning U.S. expansion in exchange for tariff reductions, according to The Wall Street Journal. 

Reviewing overnight developments:

Equity indices in the Asia-Pacific region ended Tuesday on a mostly higher note with Japan's Nikkei (+3.1%) and South Korea's Kospi (+1.5%) hitting fresh records. Japan's Nikkei: +3.1%, Hong Kong's Hang Seng: +0.9%, China's Shanghai Composite: -0.6%, India's Sensex: -0.3%, South Korea's Kospi: +1.5%, Australia's ASX All Ordinaries: +0.5%.

In news:

• Japan's Prime Minister Takaichi confirmed plans for a snap election in February aimed at boosting her party's standing in parliament.
• There was also some speculation that continued yen weakness could prompt the Bank of Japan to announce its next rate hike sooner than previously planned.
• SK Hynix is planning additional investments in its chip packaging plants in South Korea.

In economic data:

• Japan's November Current Account surplus JPY3.14 trln (expected surplus of JPY3.04 trln; last surplus of JPY2.48 trln). December Economy Watchers Current Index 48.6 (expected 48.7; last 48.7)
• Australia's January Westpac Consumer Sentiment -1.7% (last -9.0%)
• New Zealand's Q4 NZIER Business Confidence 48% (last 18%)

Major European indices trade in the red with France's CAC (-0.3%) showing relative weakness amid growing concerns about the country's political dysfunction. STOXX Europe 600: -0.1%, Germany's DAX: +0.1%, U.K.'s FTSE 100: UNCH, France's CAC 40: -0.3%, Italy's FTSE MIB: -0.2%, Spain's IBEX 35: -0.2%.

In news:

• French Prime Minister Lecornu is reportedly considering forcing through a 2026 budget without a vote.
• British homebuilder Persimmon reported strong results for Q4 while hotel operator Whitbread also delivered good results.

In economic data:

• France's November government budget deficit EUR155.4 bln (last deficit of EUR136.2 bln)