March S&P 500 E-Mini futures (ESH26) are trending down -0.17% this morning as investors cautiously await U.S. President Donald Trump’s address at the World Economic Forum in Davos, as well as a new round of economic data and corporate earnings reports.
Lower bond yields today are helping limit losses in S&P 500 futures. The 10-year T-note yield fell 1 basis point to 4.29% after long-dated Japanese bonds rebounded sharply from yesterday’s selloff.
In yesterday’s trading session, Wall Street’s main stock indexes ended in the red. The Magnificent Seven stocks slid, with Nvidia (NVDA) and Tesla (TSLA) falling over -4%. Also, cryptocurrency-exposed stocks sank after Bitcoin fell more than -3%, with MARA Holdings (MARA) slumping over -8% and Strategy (MSTR) dropping over -7% to lead losers in the Nasdaq 100. In addition, 3M Co. (MMM) slid over -6% and was the top percentage loser on the Dow after the industrial company issued soft FY26 adjusted EPS guidance. On the bullish side, SanDisk (SNDK) surged over +9% and was the top percentage gainer on the S&P 500 after Citi raised its price target on the stock to $490 from $280.
“Headlines out of Washington partially overshadowed the start of earnings season, and this week is looking like it could be a similar story,” said Chris Larkin at E*Trade from Morgan Stanley.
Market participants are looking ahead to U.S. President Donald Trump’s address at the World Economic Forum in Davos, Switzerland, later in the day. President Trump was scheduled to speak in Davos at 2:30 p.m. local time, but his appearance will be delayed after his aircraft experienced technical issues. Investors are waiting to see whether he will dial back days of heightened tensions with Europe over Greenland.
Fourth-quarter corporate earnings season is gathering pace, with investors awaiting reports from notable companies today, including Johnson & Johnson (JNJ), Charles Schwab (SCHW), Truist Financial (TFC), Kinder Morgan (KMI), and The Travelers Companies (TRV). According to Bloomberg Intelligence, companies in the S&P 500 are expected to post an average +8.4% increase in quarterly earnings for Q4 compared to the previous year.
On the economic data front, investors will focus on the National Association of Realtors’ pending home sales data, set to be released in a couple of hours. Economists expect the December figure to drop -0.3% m/m following a +3.3% m/m climb in November.
The U.S. Construction Spending report for October will also be released today. The report was originally scheduled for release on December 1st, but was delayed due to the fallout from the longest-ever government shutdown. Notably, the release will also incorporate the September figure. Economists expect construction spending to rise +0.1% m/m in October.
U.S. rate futures have priced in a 95.0% probability of no rate change and a 5.0% chance of a 25 basis point rate cut at next week’s monetary policy meeting.
In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.286%, down -0.21%.
The Euro Stoxx 50 Index is down -0.50% this morning amid lingering unease over U.S. President Donald Trump’s Greenland threats. Bank stocks were among the biggest losers on Wednesday. The moves add to the sharp losses the benchmark index has endured so far this week after President Trump announced a 10% tariff on goods from eight European countries starting February 1st, rising to 25% in June, unless he secures a deal for the “purchase of Greenland.” The European Parliament is reportedly weighing a suspension of approval for the EU-U.S. trade deal agreed last July, while EU leaders are set to hold an emergency meeting in Brussels on Thursday. Meanwhile, a study by the Austrian National Bank showed on Wednesday that the tariffs President Trump has pledged to impose on eight European countries would eventually shave 0.5% off European Union economic growth. Investor focus is now squarely on Trump’s address at the World Economic Forum in Davos. On the economic front, data released on Wednesday showed that Britain’s annual inflation rate rose slightly more than expected in December, tempering expectations for further interest rate cuts from the Bank of England. In corporate news, Barry Callebaut AG (BARN.Z.EB) gained over +3% after appointing former Unilever chief Hein Schumacher as its chief executive.
U.K. CPI and Core CPI data were released today.
U.K. December CPI rose +0.4% m/m and +3.4% y/y, compared to expectations of +0.4% m/m and +3.3% y/y.
U.K. December Core CPI rose +0.3% m/m and +3.2% y/y, compared to expectations of +0.3% m/m and +3.3% y/y.
Asian stock markets today closed mixed. China’s Shanghai Composite Index (SHCOMP) closed up +0.08%, and Japan’s Nikkei 225 Stock Index (NIK) closed down -0.41%.
China’s Shanghai Composite Index closed slightly higher today, defying a retreat in global markets amid optimism over Beijing’s intensified push for technology self-reliance. Semiconductor and other AI-related stocks climbed on Wednesday. The gains followed a fresh pledge by Chinese policymakers to step up efforts to develop homegrown AI and pursue technological breakthroughs. Non-ferrous metal stocks also gained ground. A UBS survey revealed robust investor interest across metals-linked sectors in the first quarter, alongside a preference for basic materials, aerospace, semiconductors and related equipment. Meanwhile, the benchmark index edged higher on Wednesday despite indications that authorities are seeking to rein in the pace of gains. Over the past week, the Shanghai and Shenzhen stock exchanges each took regulatory action against hundreds of abnormal trading practices, including price pumping and false orders. Regulators also tightened margin financing rules last week. In other news, Bridgewater Associates said it remains bullish on Chinese stocks this year, noting that the country’s equities “remain attractive to some extent” after corporate profit expectations improved. In corporate news, China Vanke rose over +4% after the embattled home builder said in a filing that its bondholders had approved a delay in payments on an overdue bond.
Japan’s Nikkei 225 Stock Index closed lower today as domestic political uncertainty and global trade frictions weighed on sentiment. The benchmark index dropped for a fifth straight session, logging its longest losing streak in a year. Financial stocks led the declines on Wednesday as yesterday’s government bond selloff sparked concerns over potential losses for lenders and brokerages. Tomoichiro Kubota, a senior market analyst at Matsui Securities, said, “Investors are concerned that, with yields fluctuating this much, some financial institutions might have failed to control their risks.” Also, food and beverage stocks retreated as investors locked in some profits after a sharp rally in the previous session, fueled by Prime Minister Sanae Takaichi’s plan to suspend the consumption tax on food. At the same time, utility and energy stocks outperformed. Meanwhile, Japanese government bonds rebounded on Wednesday after Finance Minister Satsuki Katayama urged calm following a selloff that had pushed super-long yields to record highs. Tuesday’s trading session was described by dealers as the most chaotic in recent memory, with yields on Japan’s 30- and 40-year bonds surging more than 25 basis points amid jitters over the fiscal implications of Takaichi’s plan to temporarily eliminate the consumption tax on food. Katayama cited Japan’s lowest reliance on debt issuance in 30 years, rising tax revenues, and the smallest fiscal deficit among G7 economies as evidence supporting the government’s view that its fiscal policy is responsible and sustainable. Investors are bracing for a host of potential catalysts on Friday, when Takaichi is set to dissolve parliament to trigger a snap election, the Bank of Japan announces its policy decision, and a wave of economic data is released. The Nikkei Volatility Index, which takes into account the implied volatility of Nikkei 225 options, closed up +4.42% to 34.29.
Pre-Market U.S. Stock Movers
United Airlines (UAL) rose over +3% in pre-market trading after the carrier posted upbeat Q4 results and issued solid Q1 adjusted EPS guidance.
Gold mining stocks advanced in pre-market trading after gold prices hit another record high, with Newmont (NEM) gaining over +2% and Freeport-McMoran (FCX) rising more than +1%.
Arm Holdings (ARM) climbed more than +3% in pre-market trading after Susquehanna upgraded the stock to Positive from Neutral with an unchanged price target of $150.
Netflix (NFLX) slumped over -6% in pre-market trading after reporting better-than-expected Q4 results but offering a cautious outlook for the months ahead, citing higher program spending and costs tied to closing its deal with Warner Bros. Discovery.
Kraft Heinz (KHC) slid more than -5% in pre-market trading after the company disclosed in a regulatory filing that its largest shareholder, Berkshire Hathaway, could sell nearly all of its shares.
You can see more pre-market stock movers here
Today’s U.S. Earnings Spotlight: Wednesday - January 21st
Johnson & Johnson (JNJ), Charles Schwab (SCHW), Prologis (PLD), TE Connectivity (TEL), Truist Financial Corp (TFC), Kinder Morgan (KMI), Travelers (TRV), Halliburton (HAL), Teledyne Technologies (TDY), Citizens Financial Group Inc (CFG), Pinnacle (PNFP), CACI (CACI), Ally Financial Inc (ALLY), Old National Bancorp (ONB), Knight-Swift Trans (KNX), MakeMyTrip (MMYT), RLI (RLI), Fulton (FULT), BankUnited (BKU), Banc of California (BANC), FB Financial (FBK), Banner (BANR), Live Oak Bancshares Inc (LOB), Dime Community (DCOM), Equity Bancshares Inc (EQBK), Horizon Bancorp (HBNC), TrustCo Bank NY (TRST), Great Southern Bancorp (GSBC), Eagle (EGBN), Third Coast Bancshares (TCBX), Currency Exchange Int (CURN).
On the date of publication, Oleksandr Pylypenko did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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