March S&P 500 E-Mini futures (ESH25) are up +0.46%, and March Nasdaq 100 E-Mini futures (NQH25) are up +0.73% this morning as solid earnings from Apple and Intel buoyed sentiment, while investors geared up for the release of the Federal Reserve’s first-line inflation gauge.
Apple (AAPL) rose over +3% in pre-market trading after the iPhone maker reported upbeat FQ1 results and offered reassuring FQ2 revenue guidance. Also, Intel (INTC) gained more than +2% in pre-market trading after reporting better-than-expected Q4 revenue.
Investors are also preparing for President Donald Trump’s tariff announcement this weekend. Trump stated that he would enact his threat to impose 25% tariffs on imports from Canada and Mexico on February 1st, citing the flow of fentanyl and substantial trade deficits as key reasons for his decision. He also threatened China with tariffs but did not specify a level.
In yesterday’s trading session, Wall Street’s major indices ended in the green. International Business Machines (IBM) surged nearly +13% and was the top percentage gainer on the Dow after the IT giant posted upbeat Q4 results and provided strong FY25 revenue growth guidance. Also, Lam Research (LRCX) climbed more than +7% and was the top percentage gainer on the Nasdaq 100 after the semiconductor equipment firm reported better-than-expected FQ2 results and offered an upbeat FQ3 forecast. In addition, Tesla (TSLA) advanced over +2% after the EV maker revealed plans to start robotaxi operations and projected a “return to growth in 2025.” On the bearish side, United Parcel Service (UPS) tumbled more than -14% and was the top percentage loser on the S&P 500 after the shipping giant issued below-consensus FY25 revenue guidance. Also, Microsoft (MSFT) slumped over -6% and was the top percentage loser on the Dow after the tech giant reported weaker-than-expected FQ2 Intelligent Cloud revenue and said its cloud-computing business will continue to grow slowly in FQ3.
The U.S. Bureau of Economic Analysis, in its initial estimate of Q4 GDP growth, said on Thursday that the economy grew at a +2.3% annualized rate, weaker than expectations of +2.7%. Also, U.S. December pending home sales plunged -5.5% m/m, weaker than expectations of no change and marking the biggest drop in 5 months. At the same time, the number of Americans filing for initial jobless claims in the past week unexpectedly fell by -16K to 207K, compared with the 224K consensus.
“Overall, the economy is on firm footing heading into 2025, which should support risk assets given the strong linkage between economic growth and corporate profits,” said Josh Jamner at ClearBridge Investments.
Meanwhile, U.S. rate futures have priced in an 84.0% chance of no rate change and a 16.0% chance of a 25 basis point rate cut at the conclusion of the Fed’s March meeting.
On the earnings front, notable companies like Exxon Mobil (XOM), AbbVie (ABBV), Chevron (CVX), Colgate-Palmolive (CL), and Charter Communications (CHTR) are slated to release their quarterly results today. According to Bloomberg Intelligence, companies in the S&P 500 are expected to post an average +7.5% increase in quarterly earnings for Q4 compared to the previous year.
Today, all eyes are focused on the U.S. core personal consumption expenditures price index, the Fed’s preferred price gauge, which is set to be released in a couple of hours. Economists, on average, forecast that the core PCE price index will stand at +0.2% m/m and +2.8% y/y in December, compared to the previous figures of +0.1% m/m and +2.8% y/y.
Investors will also focus on the U.S. Employment Cost Index, which came in at +0.8% q/q in the third quarter. Economists expect the fourth-quarter figure to be +0.9% q/q.
U.S. Personal Spending and Personal Income data will be closely monitored today. Economists anticipate December Personal Spending to be +0.5% m/m and Personal Income to be +0.4% m/m, compared to November’s figures of +0.4% m/m and +0.3% m/m, respectively.
The U.S. Chicago PMI will be released today as well. Economists estimate this figure to arrive at 40.3 in January, compared to the previous value of 36.9.
In addition, market participants will be looking toward a speech from Fed Governor Michelle Bowman.
In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.534%, up +0.49%.
The Euro Stoxx 50 Index is up +0.26% this morning, on track for a solid weekly gain, with investors digesting the latest batch of corporate earnings results. Technology and healthcare stocks led the gains on Friday. Data released on Friday showed that Germany’s monthly retail sales unexpectedly fell in December, while the unemployment rate in Europe’s largest economy crept higher in January. Separately, preliminary data from statistics agency Insee showed that France’s annual inflation rate rose less than expected at the beginning of the year. Meanwhile, the European Central Bank cut its key deposit rate by 25 basis points on Thursday, as anticipated, while leaving the door open for further policy easing amid worries about sluggish economic growth. Investor attention is now on preliminary inflation data from Germany for January, set to be released later in the session. In corporate news, Hexagon Ab (HEXAB.S.DX) climbed over +7% after the industrial technology group posted an unexpected rise in Q4 operating profit. Also, Novartis Ag (NOVN.Z.IX) gained more than +3% after the drugmaker reported better-than-expected Q4 results.
France’s CPI (preliminary), Germany’s Retail Sales, Germany’s Unemployment Change, and Germany’s Unemployment Rate were released today.
The French January CPI came in at -0.1% m/m and +1.4% y/y, better than expectations of unchanged m/m and +1.5% y/y.
The German December Retail Sales stood at -1.6% m/m and +1.8% y/y, weaker than expectations of unchanged m/m and +2.5% y/y.
The German January Unemployment Change arrived at 11K, stronger than expectations of 14K.
The German January Unemployment Rate was 6.2%, in line with expectations.
Japan’s Nikkei 225 Stock Index (NIK) closed up +0.15%, while China’s financial markets were closed for a holiday.
Japan’s Nikkei 225 Stock Index closed slightly higher today, tracking overnight gains on Wall Street. Technology stocks outperformed on Friday. Despite Friday’s gains, the benchmark index notched a weekly loss following Monday’s selloff, triggered by the emergence of Chinese startup DeepSeek, which raised concerns about demand for the most advanced chips and data centers. Government data released on Friday showed that core inflation in Japan’s capital hit 2.5% in January, marking the fastest annual rate in about a year and surpassing the Bank of Japan’s 2% target. Separately, data showed that Japan's retail sales rose at the fastest pace in six months in December, industrial production rebounded, and the unemployment rate unexpectedly ticked down. The latest batch of economic data from the country supports the Bank of Japan’s plan to pursue additional interest rate hikes. Meanwhile, BOJ Governor Kazuo Ueda on Friday reiterated that the central bank will continue raising interest rates if the economy and prices evolve in line with its forecast. However, the BOJ governor stated that underlying inflation in Japan remains slightly below the central bank’s 2% target, emphasizing that there is no rush to raise interest rates. “Our goal is to achieve a moderate rise in prices accompanied by solid wage growth. We believe that it is necessary to support economic activity by maintaining an accommodative monetary environment so that underlying inflation will gradually rise toward 2%,” Ueda told a parliamentary committee. In corporate news, NEC climbed over +18% after the computer maker boosted its full-year operating profit guidance and announced a 5-for-1 stock split. The Nikkei Volatility Index, which takes into account the implied volatility of Nikkei 225 options, closed down -2.48% to 20.48.
The Japanese January Tokyo Core CPI stood at +2.5% y/y, in line with expectations.
The Japanese December Industrial Production (preliminary) came in at +0.3% m/m, stronger than expectations of -0.1% m/m.
The Japanese December Retail Sales arrived at +3.7% y/y, stronger than expectations of +3.4% y/y.
The Japanese December Unemployment Rate was 2.4%, stronger than expectations of 2.5%.
China’s Shanghai Composite Index was closed today for the Lunar New Year holiday. Mainland China’s financial markets will reopen on Wednesday, February 5th.
Pre-Market U.S. Stock Movers
Apple (AAPL) rose over +3% in pre-market trading after the iPhone maker reported upbeat FQ1 results and offered reassuring FQ2 revenue guidance.
Intel (INTC) gained more than +2% in pre-market trading after reporting better-than-expected Q4 revenue.
Atlassian (TEAM) soared about +20% in pre-market trading after the company posted upbeat FQ2 results and issued above-consensus FQ3 revenue guidance.
KLA Corp. (KLAC) climbed more than +3% in pre-market trading after the semiconductor equipment company reported stronger-than-expected FQ2 results and gave solid FQ3 guidance.
Deckers Outdoor (DECK) plunged over -15% in pre-market trading after the UGG bootmaker raised its FY25 revenue guidance, but it failed to meet investors’ lofty expectations.
You can see more pre-market stock movers here
Today’s U.S. Earnings Spotlight: Friday - January 31st
Exxon Mobil (XOM), AbbVie (ABBV), Chevron (CVX), Eaton (ETN), Aon (AON), Colgate-Palmolive (CL), WW Grainger (GWW), Phillips 66 (PSX), Charter Communications (CHTR), Broadridge (BR), Church&Dwight (CHD), Booz Allen Hamilton (BAH), Revvity (RVTY), Franklin Resources (BEN), RBC Bearings (RBC), Brookfield Renewable (BEP), Autoliv (ALV), OneMain Holdings (OMF), Janus Henderson (JHG), Gentex (GNTX), Badger Meter (BMI), Piper Sandler (PIPR), Brookfield Business (BBU), First Hawaiian (FHB), ArcBest Corp (ARCB), Vestis (VSTS), WisdomTree (WT), Imperial Oil (IMO).
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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