Wall Street closes at a record for the first time since end of January
Indices:
- U.S. equity index futures climb to undo a portion of yesterday’s losses that saw the S&P 500 (-0.3% to 6,861), Nasdaq 100 (-0.4% to 24,797), and Dow 30 (-0.5% to 49,395) in retreat while the small-cap Russell 2000 (+0.2% to 2,665) managed to avoid a red finish, with market participants noting worries in private credit and uncertainty on the geopolitical front ahead of today’s data dump
Stocks:
- Little change for shares of Nvidia (NASDAQ:NVDA) opting to finish nearly where they started with gains for rival AMD (+1.6%) while losses for Intel (-1.9%); FT report Nvidia is nearing a $30bn investment in OpenAI to replace previous unfinished $100bn deal
- Software stocks struggle again as AI disruption fears fail to subside: Salesforce (-1.3%), S
- Alternative asset managers under pressure after Blue Owl Capital (-5.9%) sold $1.4bn in loan assets and reports it halted redemptions at one of its funds, dragging down Blackstone (-5.4%) and Apollo Global Management (-5.2%) with it
- Upgrade out of Raymond James for Chewy (+7%) to outperform sees its shares jump and close significantly higher
- Defense stocks in the US climb: Lockheed Martin (+2.6% a beneficiary of rising missile defense demand), RTX (+0.3%), Northrop Grumman (+1.7%), General Dynamic (+1.4%)
- Meme stock movers: Beyond Meat (+10.8%), GoPro (-2.9%),
- Most crypto stocks ended the session higher: Coinbase (+1.2%), Micr
- Earnings:
o Walmart (NASDAQ:WMT): slight beat on both earnings and revenue but outlook below forecast; shares close 1.4% lower
o Newmont (NYSE:NEM): earnings beat and record free cash flow; shares down 3.6% in extended trading undoing initial gains
o Airbus: beats on earnings but misses on revenue and 2026 deliveries guidance; shares close 6.8% lower
Commodities:
- Calmer moves for gold hovering around $5K and so too silver back above $78; safe-haven demand on geopolitical uncertainty offsets stronger dollar on the FX front
- Oil prices (WTI) climb again this time getting into the $66 handle on rising U.S.–Iran conflict risk after President Donald Trump to decide in next 10-15 days with further U.S. military buildup in the Middle East heightening supply-disruption concerns through the Strait of Hormuz, as well as EIA’s weekly energy inventory estimates showing sizable drawdowns for oil (-9m barrels), gasoline (-3.2m) and distillate (-4.6m)
FX/Central Banks/Crypto:
- Bitcoin back above $67K after small gains yesterday, with Ether holding above $1.9K
- US Dollar Index enjoys yet another climb getting into the upper 97 handle on hawkish comments from dove Miran (see below) and geopolitical uncertainty, as traders await more impacting economic data later today
- Federal Reserve’s (ultra dove) Miran now sees a less accommodative rate path as based on current data would have pencilled in 100bps in cuts this year instead of 150bps he put in the December forecast, Kashkari that the Fed is close on both mandates with a resilient labor market that while softer is still “decent to pretty good”, and Daly that policy is in a good place and outside the goods sector inflation continues to decline
- European Central Bank’s de Guindos that growth risks are balanced with the main danger geopolitics, and Demarco that inflation consistently below 2% could need a cut and EUR/USD at 1.2-1.25 “not end of world”
- Bank of England’s Mann that they’re getting “close to some sense of where monetary policy is balanced between the inflation objective and full employment”
Capital.com Client Sentiment:
- Indices: Heavy buy for key U.S. equity indices and rising in both Nasdaq (to a heavier 70% from 68% yesterday) and more so the Dow (from 70% to 76%) not far off extreme long territory; pullback in the DAX sees buy bias jump back into heavy long territory (66% from 55%) with a similar story for the Nikkei (71% from 64%)
- Commodities: Back near extreme buy territory in gold (77% from 74%) as longs get in despite a proper pullback and a notch higher in silver (82% from 81%); WTI’s climb sees more longs unwind (to a majority buy 62% from 64% yesterday)
- FX: Majority buy but falls back a notch in EUR/USD (to 57% from 58% yesterday) as pullback in price fails to attract more buyers while shorts unwinding in GBP/USD raises long sentiment there (to 61% from 58%), and on the verge of shifting in AUD/USD (slight buy 51% from 54%)
Data: Mixed in the U.S.
- U.S. initial jobless claims for the week come in at 206K, well below (and in turn, better than) the expected 223K but continuing claims rises to 1.869m and worse than anticipated; Philadelphia Fed Manufacturing Index for February increases to 16.3, comfortably above the 7.5 consensus and the prior 12.6 reading; December trade deficit widens to $70.3B and worse than expected; pending home sales suffers another decline down 0.8% m/m for January
- EZ December construction output rises 0.9% m/m; current account surplus for the same month improves
- Japanese CPI for January drops below the Bank of Japan’s target sliding from 2.1% to 1.5% y/y for headline, with core falling from 2.4% to 2% and ‘core-core’ to 2.6% from 2.9%
Today:
- U.S. advance GDP and PCE Price Index (5:30 pm Dubai time), preliminary PMIs (6:45 pm), UoM’s revised consumer sentiment and inflation expectations (7 pm), weekly rig count data out of Baker Hughes (10 pm)
o Earnings from Warner Bros Discovery and others
o Supreme Court decision regarding the legality of tariffs under IEEPA might occur today, else next available potential dates are next week
- In Europe, UK retail sales (11 am); German (12:30 pm), EZ (1 pm), and UK preliminary PMIs (1:30 pm)