Stock Market Update

The S&P 500 futures currently trade 22 points below fair value.

Equity indices in the Asia-Pacific region began the week on a mostly higher note while markets in China and Japan were closed for holidays. South Korea's Kospi (+0.7%) hit another record while Hong Kong's Hang Seng (+2.5%) outperformed with trade-sensitive names showing strength. U.S. Trade Representative Greer said that the effective tariff on imports from China has decreased to 40% from 45% after Friday's opinion from the Supreme Court. South Korea's exports through the first 20 days of February were up 23.5% yr/yr with chip exports jumping 16.4%. Former Bank of Japan policymaker Sakurai said that a March rate hike is possible if the yen faces renewed weakness.

• In economic data:
  • New Zealand's Q4 Retail Sales 0.9% qtr/qtr (expected 0.6%; last 1.9%) and Core Retail Sales 1.5% qtr/qtr (expected 0.4%; last 1.2%). January Credit Card Spending 1.0% yr/yr (last -0.2%)
  • Singapore's January CPI -0.5% m/m (last 0.3%); 1.4% yr/yr (last 1.2%). January Core CPI 1.0% yr/yr (last 1.2%)

---Equity Markets---

• Japan's Nikkei: CLOSED
• Hong Kong's Hang Seng: +2.5%
• China's Shanghai Composite: CLOSED
• India's Sensex: +0.6%
• South Korea's Kospi: +0.7%
• Australia's ASX All Ordinaries: -0.6%

Major European indices are mixed with Spain's IBEX (+1.3%) showing strength thanks to outperformance in banks while Germany's DAX (-0.3%) has been pressured by military contractors and automakers. Germany's auto association noted that Friday's tariff ruling in the U.S. does not apply to main tariffs affecting the auto industry. German Chancellor Merz was reelected as CDU leader by a wide margin.

• In economic data:
  • Germany's February ifo Business Climate Index 88.6 (expected 88.4; last 87.6). February Current Assessment 86.7 (expected 86.1; last 85.7) and Business Expectations 90.5, as expected (last 89.6)
  • Italy's January CPI 0.4% m/m, as expected (last 0.2%); 1.0% yr/yr, as expected (last 1.2%)
  • Swiss January PPI -0.2% m/m (expected 0.1%; last -0.2%); -2.2% yr/yr (last -1.8%)

---Equity Markets---

• STOXX Europe 600: -0.2%
• Germany's DAX: -0.3% 
• U.K.'s FTSE 100: +0.1%
• France's CAC 40: -0.1%
• Italy's FTSE MIB: +0.8%
• Spain's IBEX 35: +1.3%