Stock Market Update

Equity futures point to a slightly lower opening this morning after stocks advanced in an orderly manner yesterday, seeming to shake off the geopolitical volatility from previous sessions. 

The major averages now sit mixed for the week, with the S&P 500 and Nasdaq Composite needing to add less than 0.4% today to finish the week in positive territory. Small caps continue to outperform, with the Russell 2000 up 1.5% for the week entering today's session. 

After a volatile week, the market seems to be looking towards its next directional catalyst, being a ramp in big tech earnings next week. 

Intel (INTC 47.06, -7.26, -13.4%) is sharply lower in the premarket after beating earnings expectations but issuing downside guidance, though the stock was up nearly 50% since the start of the year, and its slide has not yet bled into a larger tech sell-off. 

In corporate news:

• China advised Alibaba (BABA 175.13, -2.05, -1.2%) and other technology firms to prep Nvidia (NVDA 187.31, +2.47, +1.3%) H200 orders, according to Bloomberg.
• Capital One Financial (COF 228.50, -6.57, -2.8%) missed EPS expectations by $0.28, reported revenues in line, and confirmed it will acquire BRex Inc. 
• Intel (INTC 47.06, -7.26, -13.4%) beat EPS expectations by $0.07, beat revenue expectations, and guided Q1 EPS below consensus with revenues in-line. The company expects supply to be at its lowest level in Q1 before improving in Q2 and Q3.
• Tesla (TSLA 448.54, -0.82, -0.2%) CEO Elon Musk repaired his relationship with President Trump and is donating to Republicans for the midterms, according to The Wall Street Journal.

Reviewing overnight developments:

Equity indices in the Asia-Pacific region enjoyed a generally higher finish to the week with South Korea's Kospi (+0.8%) continuing its record run. Japan's Nikkei: +0.3%, Hong Kong's Hang Seng: +0.5%, China's Shanghai Composite: +0.3%, India's Sensex: -0.9%, South Korea's Kospi: +0.8%, Australia's ASX All Ordinaries: +0.2%.

In news:

• Japan's Lower House was dissolved ahead of a snap election on February 8.
• New Zealand's Q4 CPI was hotter than expected, but it did not invite hawkish commentary from Reserve Bank of New Zealand Governor Breman.
• The Bank of Japan left its policy rate at 0.75%, which was expected. One policymaker dissented, voting for a rate hike.
• Malaysia's central bank also left its policy rate unchanged (2.75%).

In economic data:

• Japan's December National CPI -0.1% m/m (last 0.3%); 2.1% yr/yr (last 2.9%). National Core CPI 2.4% yr/yr, as expected (last 3.0%). Flash January Manufacturing PMI 51.5 (expected 50.1; last 50.0) and flash Services PMI 53.4 (last 51.6)
• South Korea's January Consumer Confidence 110.8 (last 109.9)
• Singapore's December CPI 0.3% m/m (last 0.2%); 1.2% yr/yr, as expected (last 1.2%). December Core CPI 1.2% yr/yr (last 1.2%). Q4 URA Property Index 0.6% qtr/qtr (expected 0.7%; last 0.9%)
• India's flash January Manufacturing PMI 56.8 (last 55.0) and flash Services PMI 59.3 (last 58.0)
• Australia's flash January Manufacturing PMI 52.4 (last 51.6) and flash Services PMI 56.0 (last 51.1)
• New Zealand's Q4 CPI 0.6% qtr/qtr (expected 0.5%; last 1.0%); 3.1% yr/yr (expected 3.0%; last 3.0%)

Major European indices are on course for a mostly lower finish to the week. STOXX Europe 600: -0.1%, Germany's DAX: UNCH, U.K.'s FTSE 100: +0.1%, France's CAC 40: -0.3%, Italy's FTSE MIB: -0.6%, Spain's IBEX 35: -0.5%.

In news:

• Flash January Manufacturing PMI readings from the region beat expectations, though the eurozone-wide reading (49.4) remained in contraction.
• British retail sales were much stronger than expected in December, which will keep the market guessing about the timing of the next rate cut from the Bank of England.
• Bank of England policymaker Greene said that there is a case to be made for moving the bank rate in the opposite direction from the fed funds rate since looser Fed policy would increase British inflation.

In economic data:

• Eurozone's flash January Manufacturing PMI 49.4 (expected 49.1; last 48.8) and flash Services PMI 51.9 (expected 52.6; last 52.4)
• Germany's flash January Manufacturing PMI 48.7 (expected 47.8; last 47.0) and flash Services PMI 53.3 (expected 52.6; last 52.7)
• U.K.'s December Retail Sales 0.4% m/m (expected 0.0%; last -0.1%); 2.5% yr/yr (expected 1.0%; last 1.8%). December Core Retail Sales 0.3% m/m (expected -0.2%; last -0.4%); 3.1% yr/yr (expected 1.4%; last 2.6%). Flash January Manufacturing PMI 51.6 (expected 50.6; last 50.6) and flash Services PMI 54.3 (expected 51.7; last 51.4)
• France's flash January Manufacturing PMI 51.0 (expected 50.4; last 50.7) and flash Services PMI 47.9 (expected 50.3; last 50.1)