March S&P 500 E-Mini futures (ESH26) are up +0.66%, and March Nasdaq 100 E-Mini futures (NQH26) are up +0.89% this morning, pointing to further gains on Wall Street after U.S. President Donald Trump walked back his threats to impose tariffs on a group of European countries over Greenland.
President Trump said on Wednesday that he would not impose tariffs on eight European countries, citing a framework for a deal on Greenland and the Arctic. “Based upon a very productive meeting that I have had with the Secretary General of NATO, Mark Rutte, we have formed the framework of a future deal with respect to Greenland and, in fact, the entire Arctic Region,” Trump said in a post on Truth Social. “Based upon this understanding, I will not be imposing the Tariffs that were scheduled to go into effect on February 1st.” NATO’s chief said on Thursday that the compromise did not involve discussions about the territory’s sovereignty.
“The framework of the Greenland deal takes down the temperature a lot, given the happenings over the weekend,” said Joe Gilbert, portfolio manager at Integrity Asset Management. “Less tariffs are unequivocally a positive for markets.”
Futures on the Nasdaq 100 outperformed as AI-related stocks climbed in pre-market trading amid a wave of activity across the AI space. OpenAI Chief Executive Officer Sam Altman was holding meetings with Middle East investors for a funding round that could value the ChatGPT developer at up to $830 billion. Also, Nvidia CEO Jensen Huang said at Davos that the global AI buildout will require trillions of dollars in spending on computing infrastructure. In addition, Bloomberg reported that Alibaba Group was preparing to list its chipmaking unit.
Investors now await a raft of U.S. economic data, with particular attention on the Fed’s favorite inflation gauge and the final estimate of third-quarter GDP, as well as a new round of corporate earnings reports.
In yesterday’s trading session, Wall Street’s three main equity benchmarks closed sharply higher. Chip stocks rallied, with Intel (INTC) surging over +11% to lead gainers in the Nasdaq 100 and Advanced Micro Devices (AMD) climbing more than +7%. Also, shares of data storage companies advanced, with Sandisk (SNDK) rising over +10% and Western Digital (WDC) gaining more than +8%. In addition, Moderna (MRNA) jumped over +15% and was the top percentage gainer on the S&P 500 after the company, together with Merck, announced positive results from a five-year follow-up study of their skin cancer vaccine. On the bearish side, Kraft Heinz (KHC) slid more than -5% after the company disclosed in a regulatory filing that its largest shareholder, Berkshire Hathaway, could sell nearly all of its shares.
Economic data released on Wednesday showed that U.S. pending home sales slumped -9.3% m/m in December, weaker than expectations of -0.3% m/m. At the same time, U.S. October construction spending rose +0.5% m/m, stronger than expectations of +0.1% m/m.
Fourth-quarter corporate earnings season picks up pace, and investors await new reports from prominent companies today, including Intel (INTC), Procter & Gamble (PG), GE Aerospace (GE), Abbott Laboratories (ABT), Intuitive Surgical (ISRG), and CSX Corporation (CSX). 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, 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. The core PCE price index for November was originally scheduled for release on December 19th, but was delayed due to the fallout from the longest-ever government shutdown. Notably, the release will also incorporate the October figures. Economists, on average, forecast that the core PCE price index will stand at +0.2% m/m and +2.8% y/y in November.
The U.S. Commerce Department’s final estimate of third-quarter gross domestic product will also be closely monitored today. Economists expect the U.S. economy to expand at an annual rate of 4.3% in the third quarter.
U.S. Personal Spending and Personal Income data will be released today. Economists expect November Personal Spending to rise +0.5% m/m and Personal Income to grow +0.4% m/m.
U.S. Initial Jobless Claims data will be reported today. Economists estimate this figure will come in at 209K, compared to last week’s number of 198K.
The EIA’s weekly crude oil inventories report will be released today as well. Economists expect this figure to be -1 million barrels, compared to last week’s value of 3.4 million barrels.
U.S. rate futures have priced in a 95.0% chance 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 4.240%, down -0.26%.
The Euro Stoxx 50 Index is up +1.25% this morning, recouping most of this week’s losses after President Trump walked back his tariff threats tied to Greenland. Carmakers and auto-part stocks led the gains on Thursday. Telecom stocks also jumped. Sentiment got a boost after Trump ruled out using military force to take control of Greenland and said he would hold off on imposing tariffs on a group of European countries, citing a “framework” deal. Reports suggest the framework could include mineral rights and the Golden Dome missile defense initiative. Meanwhile, Norway’s central bank kept its key deposit rate unchanged at 4% for the third consecutive meeting on Thursday and maintained its stance of no urgency to cut borrowing costs, with inflation still uncomfortably high. Investor attention now shifts to key U.S. economic data, along with the release of the account from the European Central Bank’s December 17-18 meeting. In corporate news, Volkswagen (0P6O.LN) rose about +5% after Europe’s largest automaker posted a stronger-than-expected 2025 net cash flow. At the same time, Ubisoft (UBI.FP) plummeted more than -31% after the Assassin’s Creed maker announced a major reorganization and said it would cancel six games.
The European economic data slate is mainly empty on Thursday.
Asian stock markets today settled in the green. China’s Shanghai Composite Index (SHCOMP) closed up +0.14%, and Japan’s Nikkei 225 Stock Index (NIK) closed up +1.73%.
China’s Shanghai Composite Index closed slightly higher today after swinging between gains and losses. Aerospace and energy stocks led the gains on Thursday. Limiting gains, non-ferrous metal stocks slumped after gold prices pulled back amid easing geopolitical tensions. Also, semiconductor stocks retreated due to profit-taking. The benchmark index’s subdued performance came amid signs that authorities are seeking to curb 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. Meanwhile, China’s state planner said on Thursday that the country has issued the first tranche of 93.6 billion yuan ($13.44 billion) in ultra-long-term special treasury bonds to fund equipment upgrades this year. In other news, Reuters reported on Wednesday that Britain and China plan to revive a “golden era” business dialogue when Prime Minister Keir Starmer travels to Beijing next week. In corporate news, Baidu climbed more than +4% in Hong Kong following the official launch of its Ernie 5.0 AI model.
Japan’s Nikkei 225 Stock Index closed higher today, snapping a five-day losing streak as a rebound in domestic bonds and easing U.S.-Europe tensions over Greenland boosted sentiment. Semiconductor stocks outperformed on Thursday. The gains were also fueled by comments from Nvidia CEO Jensen Huang at Davos, who said the global AI buildout will require trillions of dollars in investment. Government data released on Thursday showed that Japan’s exports rose for a fourth consecutive month in December, supported by strong data center-related demand, though a drop in shipments to the U.S. raised doubts about whether the momentum can be sustained in the months ahead. Exports to the U.S. fell 11.1% in December from a year earlier amid weakness in cars, auto parts, and chip-making equipment—all goods targeted by the Trump administration’s trade policies. Stefan Angrick, an economist at Moody’s Analytics, said, “Although shipments are holding up for now, the outlook is fraught with risks.” Meanwhile, Japanese government bonds rebounded for a second straight session on Thursday on expectations that the finance ministry may take steps to curb further increases in yields. In other news, foreign investors bought a net 874 billion yen worth of Japanese stocks in the week ended January 17th, buoyed by a weaker yen and expectations that a snap election could clear the path for broader fiscal stimulus, according to Ministry of Finance data. In corporate news, Disco Corp. jumped over +17% after the chipmaking equipment supplier posted strong earnings for its fiscal third quarter. Investors are bracing for a host of potential catalysts on Friday, when Prime Minister Sanae 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 down -13.65% to 29.61.
The Japanese December Trade Balance stood at 105.7 billion yen, weaker than expectations of 357 billion yen.
The Japanese December Exports rose +5.1% y/y, weaker than expectations of +6.1% y/y.
The Japanese December Imports rose +5.3% y/y, stronger than expectations of +3.6% y/y.
Pre-Market U.S. Stock Movers
The Magnificent Seven stocks advanced in pre-market trading amid risk-on sentiment, with Tesla (TSLA) and Amazon.com (AMZN) rising over +1%.
Alphabet (GOOGL) gained more than +1% in pre-market trading after Raymond James upgraded the stock to Strong Buy from Outperform with a price target of $400.
Chip stocks are moving higher in pre-market trading, with Advanced Micro Devices (AMD) and Marvell Technology (MRVL) gaining more than +2%.
Micron Technology (MU) advanced over +2% in pre-market trading after William Blair initiated coverage of the stock with an Outperform rating.
Karman Holdings (KRMN) climbed more than +9% in pre-market trading after the space and defense parts manufacturer posted better-than-expected FQ3 revenue and issued above-consensus FY26 revenue guidance.
You can see more pre-market stock movers here
Today’s U.S. Earnings Spotlight: Thursday - January 22nd
Procter & Gamble (PG), GE Aerospace (GE), Intel (INTC), Abbott Labs (ABT), Intuitive Surgical (ISRG), Capital One Financial (COF), Freeport-McMoran (FCX), CSX (CSX), Huntington Bancshares (HBAN), Northern Trust (NTRS), McCormick&Co (MKC), Alcoa (AA), East West Bancorp (EWBC), Old Republic (ORI), Columbia Banking (COLB), Cadence Bancorp (CADE), Mobileye Global (MBLY), Glacier (GBCI), Alaska Air (ALK), SLM (SLM), Texas Capital (TCBI), Eastern Bankshares (EBC), Associated Banc-Corp (ASB), Novagold (NG), Independent Bank (INDB), Cohen Steers (CNS), Cathay (CATY), Atlantic Union (AUB), Customers Bancorp (CUBI), OFG Bancorp (OFG), Pathward Financial (CASH), S&T Bancorp (STBA), Byline Bancorp (BY), Preferred Bank (PFBC), OceanFirst (OCFC), Amalgamated Bank (AMAL), Business First (BFST), Heritage Financial Co (HFWA), Amerant Bancorp A (AMTB), Independent Bank Corp (IBCP), LSI Industries (LYTS), Midland States Banc (MSBI), US Century Bank (USCB), Norwood (NWFL), First Western Financial (MYFW).
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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