A daily market update from FS Insight — what you need to know ahead of opening bell.
“It is during our darkest moments that we must focus to see the light.” — Aristotle Onassis
Overnight
PCE Report Today: Inflation Sped Up in December, Based on Fed’s Favored Gauge WSJ
Apple’s gross margin hits record as services business keeps growing CNBC
Cook points to ‘fiscal stimulus’ after Apple suffers steepest China sales decline in a year CNBC
Is Wall Street ready to stay up all night? FT
Trump takes Republicans on an economic wild ride SEM
Trump’s 25% Tariff Deadline Is Almost Here. What to Expect. WSJ
Trump, Facing Two Crises in His Second Week, Spreads the Blame Around WSJ
Rice price rise pushes Japan to tap strategic reserves FT
FDA approves Vertex’s non-opioid painkiller, first new kind of pain medicine in decades CNBC
Former Goldman Sachs analyst ordered to pay £587,000 for insider dealing FT
The Gulf welcomes Syria’s new president SEM
OpenAI’s Sam Altman and SoftBank’s Masayoshi Son Are AI’s New Power Couple WSJ
Exxon, Chevron Yearly Profits Down as Investor Payouts Hit Fresh Highs WSJ
Playful panda twins go on public view with mum at Berlin Zoo AP
Chart of the Day
| Overnight |
| S&P Futures +29
point(s) (+0.5%
) overnight range: -0 to +31 point(s) |
| APAC |
| Nikkei +0.15%
Topix +0.24% China SHCOMP -0.06% Hang Seng +0.14% Korea -0.77% Singapore +1.44% Australia +0.45% India +1.11% Taiwan +0.97% |
| Europe |
| Stoxx 50 +0.38%
Stoxx 600 +0.42% FTSE 100 +0.33% DAX +0.27% CAC 40 +0.51% Italy +0.29% IBEX +0.08% |
| FX |
| Dollar Index (DXY) +0.44%
to 108.27 EUR/USD -0.06% to 1.0385 GBP/USD +0.03% to 1.2423 USD/JPY -0.35% to 154.83 USD/CNY -0.05% to 7.2446 USD/CNH -0.05% to 7.2969 USD/CHF -0.01% to 0.9098 USD/CAD +0.06% to 1.4477 AUD/USD +0.15% to 0.6218 |
| UST Term Structure |
| 2Y-3
M Spread widened 0.1bps to -8.7bps
10Y-2 Y Spread widened 0.2bps to 30.9bps 30Y-10 Y Spread widened 0.2bps to 24.4bps |
| Yesterday's Recap |
| SPX +0.53%
SPX Eq Wt +1.07% NASDAQ 100 +0.45% NASDAQ Comp +0.25% Russell Midcap +1.17% R2k +1.07% R1k Value +1.02% R1k Growth +0.22% R2k Value +1.02% R2k Growth +1.11% FANG+ -1.10% Semis +2.35% Software -0.70% Biotech +1.04% Regional Banks +1.12% SPX GICS1 Sorted: Tech -0.56% Energy +0.53% SPX +0.53% Cons Disc +0.61% Fin +0.94% Materials +1.00% Cons Staples +1.07% Comm Srvcs +1.14% Indu +1.15% Healthcare +1.16% REITs +1.36% Utes +2.14% |
| USD HY OaS |
| All Sectors -1.3bps
to 301bps All Sectors ex-Energy +0.0bps 286bps Cons Disc -3.9bps 240bps Indu -2.5bps 225bps Tech -3.2bps 310bps Comm Srvcs +2.4bps 491bps Materials -4.7bps 272bps Energy -2.4bps 281bps Fin Snr -3.5bps 258bps Fin Sub -1.9bps 188bps Cons Staples +19.5bps 280bps Healthcare -2.0bps 372bps Utes +2.2bps 226bps * |
| Date | Time | Description | Estimate | Last |
|---|---|---|---|---|
| 1/31 | 8:30 AM | Dec PCE m/m | 0.3 | 0.1 |
| 1/31 | 8:30 AM | Dec Core PCE m/m | 0.2 | 0.11 |
| 1/31 | 8:30 AM | Dec PCE y/y | 2.6 | 2.4 |
| 1/31 | 8:30 AM | Dec Core PCE y/y | 2.8 | 2.81774 |
| 1/31 | 8:30 AM | 4Q ECI QoQ | 0.9 | 0.8 |
| 2/3 | 9:45 AM | Jan F S&P Manu PMI | 50.1 | 50.1 |
| 2/3 | 10:00 AM | Jan ISM Manu PMI | 49.3 | 49.2 |
| 2/4 | 10:00 AM | Dec JOLTS | n/a | 8098 |
| 2/4 | 10:00 AM | Dec F Durable Gds Orders | n/a | -2.2 |
| 2/5 | 8:30 AM | Dec Trade Balance | -80.4 | -78.193 |
| 2/5 | 9:45 AM | Jan F S&P Srvcs PMI | n/a | 52.8 |
| 2/5 | 10:00 AM | Jan ISM Srvcs PMI | 54.5 | 54 |
| 2/6 | 8:30 AM | 4Q P Nonfarm Productivity | 1.9 | 2.2 |
| 2/6 | 8:30 AM | 4Q P Unit Labor Costs | 3.4 | 0.8 |
MORNING INSIGHT
Good morning!
While the S&P 500 is down slightly for the week, we believe this is a successful positive test of “resolve of bulls” given there are multiple excuses for a large sell-off including DeepSeek and tariff wars and AAPL miss.
Click HERE for more.
TECHNICAL
- SPX remains choppy since last Friday and is in need of pattern resolution.
- AAPL looks to have stalled out following a run-up to test resistance into earnings.
- EEM looks to be breaking out, and China’s FXI, as well, which has bullish implications.
Click HERE for more.
CRYPTO
Developments since the inauguration confirm that the new administration is prioritizing an industry-friendly regulatory environment. Coupled with an easing DXY/yields, a possible TGA spenddown, and favorable seasonality, we think it’s prudent to maintain a long bias.
Click HERE for more.
First News
The tech-focused Nasdaq 100 turns 40 today. Its journey to the milestone illustrates the path many investors have taken, initially viewing tech stocks as risky gambles before developing what can best be described as an enduring love for an index that has arguably become the poster child for innovation and growth.
If you had invested $100 into the Nasdaq 100 at its inception on Jan. 31, 1985, you would have grown that sum to $17,207, according to an analysis of Bloomberg Data by our research team.
Bubbles have burst and steep declines have plagued tech stocks, the index’s biggest sector weight, yet the Nasdaq 100 has solidified its position as a dominant market leader. It has posted an average annual return of 13.73%.
Though initially empowered by an era of ultralow interest rates, tech stocks have continued their gravity-defying ascent higher even as yields have jumped to near multidecade highs recently.
“It’s the companies that are in there,” said Nelson Griggs, president of Nasdaq on CNBC this week. “They are the ones that are the hallmark of growth, innovation. You look at what they are spending on R&D. You look at the U.S., particularly the retail investors, they love growth stories.”
But just like any 40-year old, Nasdaq 100, too, has been busy having a midlife crisis this week. A Chinese upstart, DeepSeek, has raised questions about the amount of money invested by U.S. semiconductor companies to build out data centers and other AI infrastructure.
In Wednesday’s First to Market, we discussed how it is good to test investors’ conviction in the market’s widely agreed upon narrative. The Nasdaq 100 is still hovering near its all-time highs.
Let’s take a quick stock of Nasdaq 100 and its legacy so far.
- The index’s defining feature is that it contains the 100 largest, most-actively traded, non-financial companies listed on the Nasdaq stock market.
- Over 90 exchange-traded funds across 20 countries provide exposure to the Nasdaq 100 in some variety, said Nasdaq Head of ETP Listings Alison Hennessy on Bloomberg TV earlier this week.
- Perhaps no other ETF that passively tracks the Nasdaq 100 is as famous as Invesco’s QQQ, which has over $300 billion assets under management.
- In terms of weighting, technology stocks are 60% of the index, followed by consumer discretionary at 20%, and healthcare at almost 5%.
While the index has been a clear beneficiary of the tech fervor that has gripped investors in recent decades, it’s unclear if this tech cycle will eventually give way to something else. Cycles often do.
With respect to tech, in good times, it can seem like the party will last forever, but when bad times emerge, it can make you question your belief in the universe.
