As the North American session begins the CHF is the strongest and the JPY is the weakest. The USD is just behind the CHF and is up vs all the major currencies (unchanged vs the CHF).
In Japan, BOJ Deputy Governor, Shinichi Uchida, emphasized in remarks overnight that the future path of interest rates will be contingent on economic and price developments at the time, highlighting the importance of inflation expectations and the dynamics of prices, including wages. Uchida refrained from assessing market perceptions of future rate paths, instead noting the alignment between the government and the Bank of Japan (BOJ) on policy direction. He underlined that sustainable inflation targets of 2% are unlikely to be met without accompanying wage growth, committing to support the economy to achieve these goals.
In January 2024, China's Consumer Price Index (CPI) saw a slight increase of 0.3% month-on-month, which was below the expected 0.4%, and had previously risen by 0.1%. Year-over-year, the CPI remained in deflation, recording a decrease of -0.8%, which was deeper than both the expected -0.5% and the previous -0.3%, marking the fastest pace of price falls since the Global Financial Crisis. Core inflation, which excludes food and energy prices, was reported at +0.4% year-over-year, down from +0.6% in December 2023. The Producer Price Index (PPI) decreased by -0.2% month-on-month, continuing a downward trend for the 16th consecutive month. Year-over-year, PPI fell by -2.5%, which was slightly better than the expected -2.6% but still indicated a continuation of the declining trend from the previous -2.7%.
As the US session begins, stocks are little changed, and yields are higher.
Some earnings releases this morning and the impact:
ConocoPhillips (COP) Q4 2023
- Adjusted EPS: $2.40, BEAT Expected: $2.09
- Adjusted Net Income: $2.9 billion, BEAT Expected: $2.52 billion
- Ordinary Dividend: $0.58/share
- Shares are trading up $0.39 or 0.34% at $112.71 in premarket trading
Philip Morris International Inc (PM) Q4 2023
- EPS: BEAT Expected: $1.45
- Revenue: $9.05 billion, BEAT Expected: $9.01 billion
- FY24 Organic Revenue Growth View: -6.5% to 8%
- FY24 Adjusted EPS View: $6.32 to $6.44, MISSED Expected: $6.49
- Shares are trading down $3.01 or -3.29% in premarket trading
Under Armour Inc (UAA) Q4 2023
- Adjusted EPS: $0.19, BEAT Expected: $0.11
- Revenue: $1.5 billion, MISSED Expected: $1.51 billion
- FY Adjusted EPS View: $0.50 to $0.52, BEAT Expected: $0.49
- Shares are trading up $0.41 or 5.32% at $8.11 (a reminder that retail stocks can be brutal as consumer sentiment changes. At the heyday, the high-priced reached $52.95 back in 2015
Spirit Airlines (SAVE) Q4
- Adjusted EPS: -$1.36, BEAT Expected: -$1.47
- Revenue: $1.32 billion, BEAT Expected: $1.31 billion
- Q1 Revenue View: $1.25 billion to $1.28 billion
- Shares were trading up 0.72% at $7.00
Chip designer Arm Holdings (ARM) reported earnings after the close yesterday and beat with strong forward guidance. Its shares are the big winner today with a gain of 27% in premarket trading. Its shares surged above the previous all-time high at $79.94 and currently trades at $99.14.
A snapshot of the markets as the North American session begins currently shows:
- Crude oil is trading up $0.79 or 1.07% at $74.65. At this time yesterday, the price was trading at $73.90
- Gold is trading down -$8.99 or -0.43% at $2026. At this time yesterday, the price was trading at $2031.61
- Silver is trading up $0.10 or 0.44% at $22.29. At this time yesterday, the price was trading at $22.26
- Bitcoin traded at $44,704. At this time yesterday, the price was trading at $42,968
In the premarket for US stocks, the major indices are little changed. The S&P and Dow Industrial Average closed at record levels yesterday. However, the S&P fell short of the 5000 level by around $0.11 at session highs. Oh no...
- Dow Industrial Average futures are implying a loss of -2.1 points. Yesterday, the index rose 156.00 points or +0.40% at 38677.37. That was a new all-time record close
- S&P futures are implying a loss of -9.1 points. Yesterday, the index rose 40.81 points or 0.82% at 4995.05. That was a new all-time record close
- Nasdaq futures are implying a modest loss of -26 points. Yesterday, the index rose 147.65 points or 0.95%
In the European equity markets, the major indices are trading was a goner.
- German DAX, +0.41%
- France CAC +0.67%
- UK FTSE 100, unchanged
- Spain's Ibex, +0.43%
- Italy's FTSE MIB, 0.44% (delayed by 10 minutes).
Shares in the Asian Pacific markets were mixed.
- Japan's Nikkei 225, +2.06%
- China's Shanghai composite index , +1.28%
- Hong Kong's Hang Seng index, -1.27%
- Australia S&P/ASX, +0.312
Looking at the US debt market, yields are higher. Yesterday the U.S. Treasury auctioned off 10 year notes highlighted by stellar international demand. Today the coupon auction calendar completes with the sale of the 30 year bonds at 1 PM ET:
- 2-year yield 4.437%, +1.7 basis points. At this time yesterday, the yield was at 4.418%
- 5-year yield 4.090% +3.2 basis points. At this time yesterday, the yield was at 4.066%
- 10-year yield 4.138% +4.1 basis points.. At this time yesterday, the yield was at 4.124%
- 30-year yield 4.343% +4.4 basis points. At this time yesterday, the yield was at 4.329%
- The 2-10 year spread is at -29.8 basis points. At this time yesterday, the spread was at -28.9 basis points
- The 2-30 year spread is at -8.4 basis points. At this time yesterday, the spread was at -9.0 but basis points.
In the European debt market, the benchmark 10-year yields are higher:
