Cooler January CPI Signals an Inflation Thaw

March S&P 500 E-Mini futures (ESH26) are muted this morning as January inflation data came in cooler than expected, offering hope that price pressures are finally stabilizing. The Consumer Price Index (CPI) rose 2.4% annually, a notable drop from the previous month and a return to levels seen before the 2025 tariff implementation. Both the headline and core inflation rates matched or beat economist forecasts, with the monthly all-items index rising a modest 0.2%.

In yesterday’s trading session, Wall Street’s major indices ended in the red. The Magnificent Seven stocks fell, with Apple (AAPL) sliding -5% and Tesla (TSLA) dropping more than -2%. Also, trucking and logistics stocks sank amid concerns about disruption from AI, with Landstar Systems (LSTR) tumbling over -15% and C.H. Robinson Worldwide (CHRW) slumping more than -14%. In addition, Cisco Systems (CSCO) plunged over -12% and was the top percentage loser on the Dow after the networking company reported weaker-than-expected FQ2 adjusted gross margin and issued tepid FQ3 adjusted gross margin guidance. On the bullish side, Equinix (EQIX) surged over +10% and was the top percentage gainer on the S&P 500 after the data-center real estate investment trust issued strong FY26 guidance.

“AI might be boosting the economy thanks to massive capex investments and productivity enhancements, but it’s becoming a net negative for the stock market,” said Vital Knowledge founder Adam Crisafulli.

The Labor Department’s report on Thursday showed that the number of Americans filing for initial jobless claims in the past week fell by -5K to 227K, compared with the 222K expected. Also, U.S. existing home sales fell -8.4% m/m to a 16-month low of 3.91 million in January, weaker than expectations of 4.16 million.

Fed Governor Stephen Miran said on Thursday that the central bank’s current monetary policy stance risks undermining U.S. economic growth that is otherwise being “underwritten” by a slew of Trump administration policies, including tax cuts. “The biggest risk I think to the economy is that we’re misconstruing just how tight monetary policy is,” Miran said.

Meanwhile, the Financial Times reported on Friday that President Trump plans to roll back some tariffs on steel and aluminum products.

On the earnings front, notable companies such as Moderna (MRNA) and Advance Auto Parts (AAP) are set to release their quarterly results today.

In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.118%, up +0.34%.

The Euro Stoxx 50 Index is down -0.09% this morning as investors digest fresh corporate earnings reports and a raft of economic data from the region, while also awaiting the key U.S. inflation print. Consumer stocks underperformed on Friday, with L’Oreal (OR.FP) falling over -3% after the cosmetics giant reported weaker-than-expected Q4 sales growth. Mining stocks also lost ground. Limiting losses, defense stocks climbed, led by a more than +7% gain in Safran (SAF.FP) after it projected higher revenue and earnings for 2026 and raised its 2028 targets. Also, technology stocks advanced, although the sector remained among the week’s underperformers. The benchmark index is on track to end the week little changed. Eurostat said in an update on Friday that the Eurozone’s gross domestic product growth for the fourth quarter stood at 0.3%, in line with a preliminary estimate. Separately, final data from the INE showed that Spain’s annual inflation rate eased more than expected in January. In addition, data showed that the European Union’s exports to the U.S. remained resilient last year despite the higher tariffs imposed by President Trump. Investors now turn their attention to key U.S. inflation data. In other corporate news, Delivery Hero Se (DHER.D.DX) fell over -6% after the food-delivery company’s Middle East unit reported mixed results.

Spain’s CPI, Eurozone’s GDP (second estimate), Eurozone’s Employment Change (preliminary), and Eurozone’s Trade Balance data were released today.

The Spanish January CPI fell -0.4% m/m and rose +2.3% y/y, compared to expectations of -0.4% m/m and +2.4% y/y.

Eurozone’s GDP came in at +0.3% q/q and +1.3% y/y in the fourth quarter, in line with expectations.

Eurozone’s Employment Change arrived at +0.2% q/q and +0.7% y/y in the fourth quarter, stronger than expectations of +0.1% q/q and +0.6% y/y.

Eurozone’s December Trade Balance stood at 12.6 billion euros, stronger than expectations of 11.8 billion euros.

Asian stock markets today closed in the red. China’s Shanghai Composite Index (SHCOMP) closed down -1.26%, and Japan’s Nikkei 225 Stock Index (NIK) closed down -1.21%.

China’s Shanghai Composite Index closed lower today as investors pared risk ahead of a week-long holiday. China’s onshore stock markets will be closed from February 15-23 for the Lunar New Year holiday and will reopen on Tuesday, February 24th. Topsperity Securities said in a report that trading volumes typically ease ahead of the Spring Festival holiday, but China’s stock market has remained “at a relatively high level” without retreating, concluding that a firmer yuan provided support. Technology stocks fell on Friday, tracking losses in their global peers. Energy and mining stocks also slid. At the same time, consumer-related stocks climbed as investors wagered they would likely benefit from holiday spending. The benchmark index notched a modest weekly gain. Meanwhile, there were signs of improvement in Sino-U.S. relations after Reuters reported that the Trump administration shelved several key tech security measures aimed at Beijing ahead of an April meeting between U.S. President Donald Trump and Chinese President Xi Jinping. On the economic front, data showed that China’s new home prices continued to fall in January, keeping pressure on cash-strapped developers and the broader economy. In corporate news, Bank of East Asia plunged over -11% in Hong Kong after the bank reported a drop in full-year net profit.

Japan’s Nikkei 225 Stock Index closed lower today, retreating from a record high as sentiment soured after AI-related concerns sparked a selloff on Wall Street overnight. Technology stocks were among the biggest losers on Friday, with SoftBank Group sliding over -8% even as the technology investor posted a fourth straight quarterly profit. Shigetoshi Kamada, an advisor at the research department at Tachibana Securities, said, “There was little positive surprise from the results, so SoftBank shares fell along with the market move.” Energy, real estate, and industrial stocks also slumped. Despite Friday’s drop, the benchmark index posted strong gains for the week, marking its second consecutive weekly advance. Goldman Sachs strategists upgraded Japanese stocks to Overweight on Friday, citing expectations for “a period of political stability” and policy tailwinds for “defense, critical resources, shipbuilding, power resources, U.S. re-industrialization plays.” Meanwhile, Bank of Japan policy board member Naoki Tamura on Friday raised the possibility that the central bank could soon declare that its price target has been achieved. “It is quite possible that, as early as this spring, the price stability target of 2% can be judged to have been achieved,” Tamura said, highlighting his preference for a near-term rate hike. In other news, foreign investors bought a net 543.2 billion yen ($3.55 billion) worth of Japanese stocks in the week ended February 7th in anticipation of Prime Minister Sanae Takaichi’s decisive election win, marking a seventh consecutive week of inflows, according to Ministry of Finance data. In other corporate news, Inpex plunged over -13% after the country’s largest oil and gas producer flagged a 16% drop in its full-year net profit for the year to December. At the same time, Kioxia climbed more than +7% after providing upbeat full-year earnings guidance. The Nikkei Volatility Index, which takes into account the implied volatility of Nikkei 225 options, closed up +0.32% to 34.21.

Pre-Market U.S. Stock Movers

Most chip stocks are moving lower in pre-market trading, with Micron Technology (MU) and Intel (INTC) falling more than -1%.

U.S. steel stocks slid in pre-market trading after the Financial Times reported that President Trump plans to roll back some tariffs on steel and aluminum products. Steel Dynamics (STLD) is down over -4%. Also, Nucor (NUE) and Cleveland-Cliffs (CLF) are down more than -2%.

Pinterest (PINS) plunged over -19% in pre-market trading after the social-media company reported weaker-than-expected Q4 revenue and issued below-consensus Q1 revenue guidance.

Applied Materials (AMAT) surged over +11% in pre-market trading after the largest U.S. supplier of chipmaking gear posted stronger-than-expected FQ1 results and issued surprisingly strong FQ2 guidance.

Arista Networks (ANET) climbed more than +8% in pre-market trading after the networking-equipment company reported upbeat Q4 results and raised its full-year revenue guidance.

You can see more pre-market stock movers here

Today’s U.S. Earnings Spotlight: Friday - February 13th

Cameco (CCJ), Magna International (MGA), Moderna (MRNA), Air Lease (AL), Essent Group (ESNT), Seaboard (SEB), Atmus Filtration Technologies (ATMU), Sensient Technologies (SXT), Advance Auto Parts (AAP), Trump Media & Technology Group (DJT), IDEAYA Biosciences (IDYA), National HealthCare (NHC), The Wendy’s Company (WEN), Carter’s (CRI), CBL & Associates Properties (CBL), Dauch (DCH), Marcus & Millichap (MMI), Daily Journal (DJCO), Investors Title Company (ITIC), PRA Group (PRAA), Farmers & Merchants Bancorp (FMAO), MVB Financial (MVBF), Imperial Petroleum (IMPP), Westwood Holdings Group (WHG), FONAR (FONR), Roadzen (RDZN), Rithm Property Trust (RPT).