Stocks are Mixed After Weak Retail Sales Data Released

The S&P 500 Index ($SPX) (SPY) today is down -.10%, the Dow Jones Industrials Index ($DOWI) (DIA) is up +0.12%, and the Nasdaq 100 Index ($IUXX) (QQQ) is down -0.25%.  

Stock indexes are mixed today. This morning a weaker-than-expected reports on Dec retail sales was released and the Q4 employment cost index, which knocked bond yields lower.  The 10-year T-note yield fell to a 3-week low today at 4.14%.

US retail sales unexpectedly stagnated in December, suggesting some weakness in consumer spending.  Also, the weakness in retail sales could lead to a downward revision in Q4 GDP. 

The US Q4 employment cost index rose +0.7% q/q, weaker than expectations of +0.8% q/q and the smallest increase in 4.5 years.

US Dec retail sales were unchanged m/m, weaker than expectations of +0.4% m/m.  Dec retail sales ex-autos were also unchanged m/m, weaker than expectations of +0.4% m/m.

The markets this week will focus on corporate earnings results and economic news.  On Wednesday, Jan nonfarm payrolls are expected to climb +68,000, and the Jan unemployment rate is expected to remain unchanged at 4.4%.  Also, Jan average hourly earnings are expected to rise by +0.3% m/m and +3.7% y/y.  On Thursday, initial weekly unemployment claims are expected to fall by -7,000 to 224,000.  Also, Jan existing home sales are expected to decline by -4.3% m/m to 4.16 million.  On Friday, Jan CPI is expected to be up +2.5% y/y, and Jan core CPI is expected to be up +2.5% y/y.

Q4 earnings season is in full swing, as more than half of the S&P 500 companies have reported earnings results.  Earnings have been a positive factor for stocks, with 79% of the 297 S&P 500 companies that have reported beating expectations.  According to Bloomberg Intelligence, S&P earnings growth is expected to climb by +8.4% in Q4, marking the tenth consecutive quarter of year-over-year growth.  Excluding the Magnificent Seven megacap technology stocks, Q4 earnings are expected to increase by +4.6%.

The markets are discounting a 22% chance for a -25 bp rate cut at the next policy meeting on March 17-18.

Overseas stock markets are higher today.  The Euro Stoxx 50 climbed to a new record high and is up by +0.03%.  China's Shanghai Composite rose to a 1-week high and closed up +0.13%.  Japan's Nikkei Stock 225 rallied to a new all-time high and closed up sharply by +2.28%.

Interest Rates

March 10-year T-notes (ZNH6) today are up by +10 ticks.  The 10-year T-note yield is down -5.3 bp to 4.150%.  Mar T-notes rallied to a 1-month high today, and the 10-year T-note yield fell to a 3.5-week low of 4.137%.  T-notes found support on today's weaker-than-expected reports on the Q4 employment cost index and Dec retail sales, which were dovish for Fed policy.  Limiting gains in T-notes are supply pressures as the Treasury will auction $58 billion of 3-year T-notes later today in the first leg of this week's quarterly refunding, in which $125 billion of T-notes and T-bonds will be sold. 

European government bond yields are moving lower today.  The 10-year German bund yield fell to a 1-month low of 2.800% and is down -3.6 bp to 2.804%.  The 10-year UK gilt yield fell to a 2-week low of 4.485% and is down by -3.1 bp to 4.496%.

An ECB blog post today said that lower interest rates can reduce the drag on inflation and economic growth caused by higher US tariffs. 

ECB Vice President Luis de Guindos said, "We believe that risks are balanced and the current level of interest rates is appropriate in the Eurozone."

Swaps are discounting a 2% chance of a -25 bp rate cut by the ECB at its next policy meeting on March 19.

US Stock Movers

Cybersecurity stocks are moving higher today.  Atlassian (TEAM) is up more than +4%, and Zscaler (ZS) and Cloudflare (NET) are up more than +3%.  Also, CrowdStrike Holdings (CRWD) and Fortinet (FT) are up more than +1%. 

AI-infrastructure stocks are under pressure today, weighing on the broader market.  Western Digital (WDC) is down more than -8% to lead losers in the Nasdaq 100.  Also, Seagate Technology Holdings Plc (STX) is down more than -6%, and Intel (INTC) is down more than -5%.  In addition, Micron Technology (MU) is down more than -3%, and Lam Research (LRCX) is down more than -2%.  Finally, KLA Corp (KLAC) is down more than -1%.

Ichor Holdings Ltd (ICHR) is up more than +34% after forecasting Q1 adjusted EPS of 8 cents to 16 cents, well above the consensus of 6.1 cents.

Spotify (SPOT) is up more than +17% after reporting a record 38 million monthly active users in Q4, well above the consensus of 32 million. 

Datadog (DDOG) is up more than +15% to lead gainers in the S&P 500 and Nasdaq 100 after reporting Q4 revenue of $953.2 million, stronger than the consensus of $917.2 million. 

Credo Technology Group Holding Ltd (CRDO) is up more than +10% after forecasting preliminary Q3 revenue of $404 million to $408 million, well above the consensus of $341.2 million. 

Masco (MAS) is up more than +9% after forecasting full-year adjusted EPS of $4.10 to $4.30, the midpoint above the consensus of $4.19. 

Marriott International (MAR) is up more than +8% after forecasting 2026 adjusted EPS of $11.32 to $11.57, the midpoint above the consensus of $11.42. 

Shopify (SHOP) is up more than +8% after ATB Capital upgraded the stock to outperform from sector perform with a price target of $250.

Cintas (CTAS) is up more than +2% after Bloomberg reported that UniFirst Corp. is in active discussions to be acquired by Cintas.

Goodyear Tire & Rubber Co (GT) is down more than -13% after reporting Q4 adjusted EPS of 39 cents, below the consensus of 49 cents. 

Amentum Holdings (AMTM) is down more than -10% after reporting Q1 revenue of $3.24 billion, below the consensus of $3.32 billion. 

Incyte (INCY) is down more than -8% to lead losers in the S&P 500 after forecasting dull-year total net product revenue of $4.77 billion to $4.94 billion, the midpoint below the consensus of $4.87 billion.

Xylem Inc (XYL) is down more than -6% after forecasting 2026 revenue of $9.1 billion to $9.2 billion, below the consensus of $9.33 billion. 

S&P Global Inc (SPGI) is down more than -5% after forecasting full-year adjusted EPS of $19.40 to $19.65, weaker than the consensus of $20.00. 

WESCO International (WCC) is down by more than -4% after reporting Q4 adjusted EPS of $3.40, weaker than the consensus of $3.88. 

Coca-Cola (KO) is down more than -1% to lead losers in the Dow Jones Industrials after reporting Q4 net revenue of $11.80 billion, below the consensus of $12.03 billion. 

Earnings Reports(2/10/2026)

American International Group Inc (AIG), Assurant Inc (AIZ), Coca-Cola Co/The (KO), CVS Health Corp (CVS), Datadog Inc (DDOG), Duke Energy Corp (DUK), DuPont de Nemours Inc (DD), Ecolab Inc (ECL), Edwards Lifesciences Corp (EW), Fiserv Inc (FISV), Ford Motor Co (F), Gilead Sciences Inc (GILD), Hasbro Inc (HAS), Incyte Corp (INCY), Marriott International Inc/MD (MAR), Masco Corp (MAS), Quest Diagnostics Inc (DGX), Robinhood Markets Inc (HOOD), S&P Global Inc (SPGI), Trimble Inc (TRMB), Welltower Inc (WELL), Williams Cos Inc/The (WMB), Xylem Inc/NY (XYL), Zimmer Biomet Holdings Inc (ZBH).