S&P Futures Climb With U.S. Inflation Data in Focus

March S&P 500 E-Mini futures (ESH25) are trending up +0.56% this morning as investors gear up for the release of crucial U.S. inflation data.

Stock futures got a boost after U.S. President Donald Trump stated he doesn’t see a U.S. recession. “I don’t see it at all. I think this country’s going to boom,” he said late Tuesday at the White House. Also, Bloomberg reported that President Trump told top executives at a Business Roundtable meeting on Tuesday that he is prioritizing rapid approvals, particularly for environmental regulations, and plans to announce a major electricity project soon. He also reiterated the idea that a company’s business taxes could be lowered if it produced its goods in the U.S.

In yesterday’s trading session, Wall Street’s main stock indexes ended in the red. Teradyne (TER) plunged over -17% and was the top percentage loser on the S&P 500 after the company said it expects FQ2 revenue to be flat to down -10% q/q. Also, chip stocks retreated, with GlobalFoundries (GFS) sliding more than -6% to lead losers in the Nasdaq 100 and Texas Instruments (TXN) falling over -4%. In addition, Verizon Communications (VZ) slumped more than -6% and was the top percentage loser on the Dow after the company’s chief revenue officer said Q1 is “challenging” from a competitive intensity standpoint. On the bullish side, Southwest Airlines (LUV) climbed over +8% after the airline announced plans to charge non-preferred customers for their first and second checked bags.

Tuesday’s U.S. economic data showed strength in the labor market, offering some support to equities. The JOLTs job openings rose to 7.740M in January, stronger than expectations of 7.650M.

“Even if the majority of this drawdown is potentially behind us, volatility may not be, and there’s a good chance the market could chop sideways for a while,” said Daniel Skelly, head of Morgan Stanley’s Wealth Management Market Research & Strategy Team.

Meanwhile, Trump’s tariff policy, geopolitical shifts surrounding Ukraine, sticky inflation, and uncertainty over the pace of the Federal Reserve’s interest-rate cuts have dampened market sentiment this year, bringing U.S. equities close to a correction. Goldman Sachs has become the latest major bank to adjust its forecast for the U.S. equity benchmark amid rising policy uncertainty and growing concerns over the world’s largest economy, cutting its year-end target for the S&P 500 Index to 6,200 from 6,500.

President Trump’s 25% tariffs on steel and aluminum imports took effect today following a turbulent day at the White House, when he threatened to raise the metals tariffs on Canada to 50%. The president backed off after Ontario agreed to abandon plans for a surcharge on electricity exports to the U.S.

Today, all eyes are focused on the U.S. consumer inflation report, which is set to be released in a couple of hours. Economists, on average, forecast that the U.S. February CPI will come in at +0.3% m/m and +2.9% y/y, compared to the previous numbers of +0.5% m/m and +3.0% y/y. Also, the U.S. core CPI is expected to be +0.3% m/m and +3.2% y/y in February, compared to January’s figures of +0.4% m/m and +3.3% y/y.

“It feels that this could be a lose-lose situation. A higher-than-expected reading could fuel the stagflation narrative while a weaker-than-expected print could cement recession fears,” said Julien Lafargue, chief market strategist at Barclays Private Bank.

On the earnings front, Photoshop maker Adobe (ADBE) is set to report its FQ1 earnings results today. 

U.S. rate futures have priced in a 97.0% chance of no rate change and a 3.0% chance of a 25 basis point rate cut at the Fed’s monetary policy committee meeting next week.

In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.275%, down -0.30%.

The Euro Stoxx 50 Index is up +1.19% this morning as investor sentiment improved on hopes for a potential ceasefire in Ukraine. Ukraine agreed to a U.S. proposal for a 30-day truce with Russia as part of a deal with the Trump administration to unfreeze military aid and intelligence support for Kyiv. Bank stocks outperformed on Wednesday. Limiting gains, retail stocks slumped. Meanwhile, the European Union unveiled countermeasures on Wednesday against new U.S. metals tariffs, outlining plans to impose retaliatory duties on 26 billion euros worth of American goods beginning in April. Investor focus is now on key U.S. inflation data due later in the day. In corporate news, Zealand Pharma A/S (ZEAL.C.DX) surged over +23% after Swiss pharmaceutical company Roche licensed its new weight-loss drug. At the same time, Puma Se (PUM.D.DX) plummeted more than -24% after the German sportswear group provided a disappointing Q1 sales forecast.

ECB President Christine Lagarde stated on Wednesday that the Eurozone economy is encountering exceptional shocks from trade, defense, and climate issues, which could amplify inflation volatility and increase the risk of price growth becoming more persistent.

The European economic data slate is mainly empty on Wednesday.

Asian stock markets today closed mixed. China’s Shanghai Composite Index (SHCOMP) closed down -0.23%, and Japan’s Nikkei 225 Stock Index (NIK) closed up +0.07%. 

China’s Shanghai Composite Index closed slightly lower today as investors booked profits following a recent rally while continuing to assess the impact of U.S. tariffs. Telecom and consumer stocks led the declines on Wednesday. Some analysts noted that concerns over China’s deflationary pressures and uncertainties surrounding tariffs could dampen sentiment in the near term. Meanwhile, investors are looking ahead to further policy signals from Beijing after the conclusion of the Two Sessions annual meetings. So far, Chinese leaders have laid out plans to enhance technological innovation and ramp up spending to stimulate consumption and meet Beijing’s ambitious 5% growth target this year. In other news, China on Wednesday vowed to take all necessary measures to protect its rights and interests after U.S. President Donald Trump raised tariffs on all U.S. steel and aluminum imports. In corporate news, Cathay Pacific Airways dropped more than -1% in Hong Kong after the airline cautioned about an uncertain outlook for its cargo unit amid global trade tensions.

Japan’s Nikkei 225 Stock Index closed just above the flatline today as worries about U.S. tariffs and their impact on the global economy kept sentiment subdued. Financial stocks outperformed on Wednesday, buoyed by rising government bond yields. Data released on Wednesday showed that Japan’s annual wholesale inflation reached 4.0% in February, highlighting pressure from rising raw material costs that will sustain expectations for further interest rate hikes by the Bank of Japan. Separately, data showed that sentiment among Japan’s large manufacturing firms unexpectedly turned negative in the first quarter, marking the first negative reading since the second quarter of last year and underscoring ongoing economic challenges. Meanwhile, BOJ Governor Kazuo Ueda reaffirmed on Wednesday that bond yields should be determined by market forces, signaling that the central bank has no immediate plans to intervene to curb rising yields. “There is no big difference between the market’s view and ours,” Ueda told a parliamentary committee regarding the recent rise in Japanese government bond yields. In other news, Japan’s largest labor union group is set to release preliminary results for annual wage negotiations on Friday. The Japanese Trade Union Confederation, known as Rengo, representing around 7 million members, said last week that its member unions are aiming for an average wage hike of 6.09%, the biggest request in three decades. In corporate news, Nissan Motor rose about +0.6% after the automaker announced on Tuesday that company veteran Ivan Espinosa will be its next chief executive. The Nikkei Volatility Index, which takes into account the implied volatility of Nikkei 225 options, closed down -4.63% to 27.79.

The Japanese BSI Large Manufacturing Conditions Index stood at -2.4 in the first quarter, weaker than expectations of 6.5.

The Japanese February PPI has been reported at 0.0% m/m and +4.0% y/y, compared to expectations of -0.1% m/m and +4.0% y/y.

Pre-Market U.S. Stock Movers

Intel (INTC) climbed more than +7% in pre-market trading after Reuters reported that TSMC pitched chip designers Nvidia, Advanced Micro Devices, and Broadcom about acquiring stakes in a joint venture that would operate Intel’s factories.

Stitch Fix (SFIX) surged over +18% in pre-market trading after the company posted better-than-expected FQ2 results and raised its FY25 guidance.

Casey’s General Stores (CASY) rose more than +2% in pre-market trading after the convenience store operator reported upbeat FQ3 results.

Applied Materials (AMAT) gained over +1% in pre-market trading after Edward Jones upgraded the stock to Buy from Hold.

PepsiCo (PEP) fell about -0.6% in pre-market trading after Jefferies downgraded the stock to Hold from Buy.

You can see more pre-market stock movers here

Today’s U.S. Earnings Spotlight: Wednesday - March 12th

Adobe (ADBE), Dollar Tree (DLTR), UiPath (PATH), SentinelOne (S), ABM Industries (ABM), ZIM Integrated Shipping Services (ZIM), American Eagle Outfitters (AEO), Sprinklr (CXM), Arcos Dorados (ARCO), Ehang (EH), Nextnav Acquisition (NN), Phreesia (PHR), Smith Douglas Homes (SDHC), Navigator Holdings (NVGS), Vivid Seats (SEAT), National Energy Services (NESR), Legacy Housing (LEGH), Otc Markets Group (OTCM), Algoma Steel (ASTL), North American Construction (NOA), Calavo Growers (CVGW), Montauk Renewables (MNTK), Limoneira (LMNR), Chicago Atlantic Real Estate Finance (REFI), Galiano Gold (GAU), Berry Petroleum (BRY), Vasta Platform (VSTA), Anika (ANIK), Performant (PHLT), Amarin (AMRN), iRobot (IRBT), Ellington Residential Mortgage (EARN), Beauty Health Co (SKIN), biote Corp (BTMD), MagnaChip (MX), Nektar (NKTR), AudioEye (AEYE), PHX Minerals (PHX), KORU Medical Systems (KRMD), Brilliant Earth (BRLT), Freightcar (RAIL), Tillys (TLYS).