S&P Futures Slip Amid Risk Aversion, U.S. PPI Data on Tap

March S&P 500 E-Mini futures (ESH26) are trending down -0.41% this morning as investors continue to trim exposure to risky assets at the end of a volatile month.

The price of WTI crude rose over +2% as investors remained wary of potential supply risks in the Middle East, even after positive signals from nuclear talks between the U.S. and Iran on Thursday. Negotiations between the two countries will resume next week.

Investors are now turning their attention to crucial U.S. producer inflation data.

In yesterday’s trading session, Wall Street’s major indices closed mixed. Chip stocks sank, weighed down by a more than -5% drop in Nvidia (NVDA) after the chipmaker’s stronger-than-expected Q4 results and Q1 guidance failed to reassure investors seeking clarity on AI. Also, Universal Health Services (UHS) tumbled over -11% and was the top percentage loser on the S&P 500 after the company posted downbeat Q4 results. In addition, The Trade Desk (TTD) slid more than -4% after the advertising technology company provided below-consensus Q1 revenue guidance. On the bullish side, software stocks climbed, with Atlassian (TEAM) rising over +8% to lead gainers in the Nasdaq 100 and Datadog (DDOG) advancing more than +5%.

The Labor Department’s report on Thursday showed that the number of Americans filing for initial jobless claims in the past week rose by +4K to 212K, compared with the 217K expected. The report indicated that layoffs remain relatively low.

Meanwhile, UBS said on Friday that it had lowered its recommended allocation to U.S. equities to Neutral. Strategists Andrew Garthwaite and Marc El Koussa pointed to factors such as the relatively lower sensitivity of U.S. corporate earnings to global growth, elevated valuations, a trend of funds diversifying away from the U.S., and downside risks to the dollar.

Today, all eyes are focused on the U.S. Producer Price Index, which is set to be released in a couple of hours. The PPI will provide further insight into the outlook for inflation. Economists, on average, forecast that the U.S. January PPI will stand at +0.3% m/m and +2.6% y/y, compared to the previous figures of +0.5% m/m and +3.0% y/y.

The U.S. Core PPI will also be closely monitored today. Economists expect January figures to be +0.3% m/m and +3.0% y/y, compared to +0.7% m/m and +3.3% y/y in December.

The U.S. Chicago PMI will be released today. Economists forecast the February figure at 52.0, compared to the previous value of 54.0.

The U.S. Construction Spending report for December will be released today as well. The report was originally scheduled for release on February 2nd, but was delayed due to the fallout from the longest-ever government shutdown. Notably, the release will also incorporate the November figures. Economists expect construction spending to rise +0.2% m/m in December.

U.S. rate futures have priced in a 96.1% chance of no rate change and a 3.9% chance of a 25 basis point rate cut at next month’s monetary policy meeting.

In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 3.989%, down -0.70%.

The Euro Stoxx 50 Index is down -0.05% this morning, hovering near a record high. Mining stocks outperformed on Friday. At the same time, travel stocks slid. The benchmark index is on track for an eighth consecutive monthly gain as positive corporate updates bolstered risk appetite despite lingering concerns over tariffs and AI disruption. Preliminary data released on Friday showed that France’s annual inflation rate picked up slightly more than expected in February, while Spain’s inflation held steady. Separately, data showed that the number of people out of work in Germany edged up in February, as the economic weakness of the past three years continues to weigh on the labor market. In addition, a European Central Bank survey showed that Eurozone consumers pared back some of their inflation expectations in January, even as expectations for income growth increased. Investors now await preliminary inflation data from Germany due later in the session. In corporate news, Swiss Re AG (SREN.Z.IX) rose over +4% after posting an almost 50% jump in net profit. At the same time, Delivery Hero SE (DHER.D.DX) slumped more than -7% after the online takeaway food company posted weaker-than-expected annual gross merchandise value.

France’s CPI (preliminary), France’s GDP,  Spain’s CPI (preliminary), Germany’s Unemployment Change, and Germany’s Unemployment Rate were released today.

The French February CPI rose +0.7% m/m and +1.0% y/y, stronger than expectations of +0.5% m/m and +0.8% y/y.

The French GDP came in at +0.2% q/q and +1.1% y/y in the fourth quarter, in line with expectations.

The Spanish February CPI rose +2.3% y/y, stronger than expectations of +2.2% y/y.

The German February Unemployment Change stood at 1K, stronger than expectations of 2K.

The German February Unemployment Rate was 6.3%, in line with expectations.

Asian stock markets today closed in the green. China’s Shanghai Composite Index (SHCOMP) closed up +0.39%, and Japan’s Nikkei 225 Stock Index (NIK) closed up +0.16%.

China’s Shanghai Composite Index closed higher today amid positive sentiment ahead of next week’s annual parliamentary meeting. Coal stocks outperformed on Friday. Consumer-related stocks also advanced. At the same time, chip stocks declined following an overnight drop in AI darling Nvidia. The benchmark index posted gains for the holiday-shortened week and notched its third straight monthly advance. Morgan Stanley analysts said sentiment has improved as investors rebuilt equity positions after the holiday, state-linked funds paused heavy selling, and expectations increased that the upcoming National People’s Congress will introduce policies supportive of technology. Meanwhile, China’s top leaders reaffirmed their pro-growth policy stance as they gathered for a meeting to prepare for March’s agenda-setting annual legislative session. Officials at Friday’s Politburo meeting of the ruling Communist Party reiterated their commitment to a more proactive fiscal policy and a moderately loose monetary policy. They also vowed to keep expanding domestic demand and improving supply. Investors are looking ahead to the upcoming sessions of the National People’s Congress and the National Committee of the Chinese People’s Political Consultative Conference, with the CPPCC set to open on March 4th and the NPC beginning on March 5th. Investors will be closely watching the “Two Sessions” for key economic targets for 2026, most notably the GDP growth goal. China is widely anticipated to set a 2026 growth target of 4.5%-5.0%, down from its previous “around 5%” goal, as domestic demand remains weak.

Japan’s Nikkei 225 Stock Index closed higher and hit a new record high today. Energy and mining stocks led the gains on Friday. Strength in industrial and financial stocks also provided support to the Nikkei. Hiroyasu Mori, head of research at Okachi Securities, said, “The market became cautious about the fast-paced rally as the Nikkei neared the 60,000-mark, but investors are bullish on the two-digit profit growth rate of companies in Japan in the coming fiscal year.” The benchmark index posted its largest monthly gain in four months as Prime Minister Sanae Takaichi’s landslide victory in this month’s general election fueled expectations of substantial fiscal spending. Government data released on Friday showed that annual core inflation in Tokyo slipped below the Bank of Japan’s 2% target for the first time in more than a year in February, though the slowdown is unlikely to deter further interest rate hikes. The data aligns with the BOJ’s projection that consumer inflation will temporarily ease due to fuel subsidies and the base effects of last year’s spike, before picking up again on the back of steady wage gains. Separate data indicated that consumption remains robust, with retail sales rising far more than expected in January. In addition, data showed that Japan’s monthly industrial production rose in January, rebounding from the prior month’s contraction amid front-loaded demand ahead of the Lunar New Year holidays. Capital Economics’ Marcel Thieliant said that the latest data suggest the BOJ may not wait much longer before raising rates again. In other news, foreign investors bought a net 402 billion yen worth of Japanese stocks in the week through February 21st, extending their buying streak to a ninth consecutive week, according to data from Japan’s Ministry of Finance. In corporate news, Sony Group rose over +7% after the audio equipment and gaming company boosted its share buyback plan to as much as 250 billion yen from 150 billion yen. The Nikkei Volatility Index, which takes into account the implied volatility of Nikkei 225 options, closed down -12.43% to 27.33.

The Japanese February Tokyo Core CPI rose +1.8% y/y, stronger than expectations of +1.7% y/y.

The Japanese January Industrial Production (preliminary) rose +2.2% m/m, weaker than expectations of +5.5% m/m.

The Japanese January Retail Sales rose +1.8% y/y, stronger than expectations of +0.1% y/y.

Pre-Market U.S. Stock Movers

Chip stocks are moving lower in pre-market trading, with Micron Technology (MU) falling over -1% and Intel (INTC) dropping nearly -1%.

CoreWeave (CRWV) plunged more than -11% in pre-market trading after the neocloud provider posted a wider-than-expected Q4 loss and said its 2026 capital spending would total $30 billion to $35 billion.

Intuit (INTU) fell over -3% in pre-market trading after the financial software company issued below-consensus FQ3 adjusted EPS guidance.

Block (XYZ) surged more than +18% in pre-market trading after the payment services company issued strong FY26 gross profit guidance and announced plans to cut 40% of its workforce.

Netflix (NFLX) jumped over +7% in pre-market trading after the streaming giant pulled out of a bidding war for Warner Bros. Discovery.

You can see more pre-market stock movers here

Today’s U.S. Earnings Spotlight: Friday - February 27th

Avidity Biosciences (RNA), Chart Industries (GTLS), BrightSpring Health Services (BTSG), Globalstar (GSAT), Arcellx (ACLX), Macy's (M), Amneal Pharmaceuticals (AMRX), Structure Therapeutics (GPCR), Endeavour Silver (EXK), NIQ Global Intelligence (NIQ), Xenon Pharmaceuticals (XENE), TEGNA (TGNA), Denali Therapeutics (DNLI), Delek Logistics Partners (DKL), Hawaiian Electric Industries (HE), Calumet (CLMT), Dyne Therapeutics (DYN), Ivanhoe Electric (IE), Alpha Metallurgical Resources (AMR), Delek US Holdings (DK), Northwest Natural Holding Company (NWN), Sunstone Hotel Investors (SHO), Natural Resource Partners (NRP), Global Partners LP (GLP), ANI Pharmaceuticals (ANIP), Carter's (CRI), Arbor Realty Trust (ABR), Alexander & Baldwin (ALEX), Biohaven (BHVN), Via Transportation (VIA), Taysha Gene Therapies (TSHA), Saul Centers (BFS), Sabine Royalty Trust (SBR), Ventyx Biosciences (VTYX), GH Research (GHRS), Prime Medicine (PRME), Fulgent Genetics (FLGT), IsoEnergy (ISOU), Green Dot (GDOT), Allogene Therapeutics (ALLO), Gogo Inc. (GOGO), Docebo (DCBO), 4D Molecular Therapeutics (FDMT), Rocket Pharmaceuticals (RCKT), Blend Labs (BLND), Dolly Varden Silver (DVS), BlackRock TCP Capital (TCPC), Blue Moon Metals (BMM), New Fortress Energy (NFE), ALX Oncology Holdings (ALXO), Repay Holdings (RPAY), Vuzix (VUZI), Comstock (LODE), 1stdibs.Com (DIBS), Escalade (ESCA), Immersion (IMMR), Douglas Elliman (DOUG), Abundia Global Impact Group (AGIG), Treace Medical Concepts (TMCI), inTEST (INTT), Fluent (FLNT).