A daily market update from FS Insight — what you need to know ahead of opening bell.
“The opposite of love is not hate, it’s indifference. The opposite of art is not ugliness, it’s indifference. The opposite of faith is not heresy, it’s indifference. And the opposite of life is not death, it’s indifference.” – Elie Wiesel
Overnight
Judge says Trump admin has withheld foreign aid despite court order AX
U.S. doubles down on demand that Ukraine give away mineral rights WSJ
Israel accuses Hamas of violating ceasefire by substituting hostage’s body FT
Japan to court Tesla on Nissan investment FT
SEC to drop lawsuit against Coinbase, exchange says RTR
UnitedHealth Stock Falls on Report DOJ Investigating Its Medicare Billing BAR
Block shares drop as spending slowdown puts BNPL expansion in focus RTR
DeepSeek promises to share even more AI code in a rare step BBG
The wild economics behind Ferrari’s domination of the luxury car market WSJ
Sinn Féin to boycott White House St Patrick’s Day celebrations BBC
Birkenstock sandals are not copyrightable art, says German court BBC
Amazon MGM to take over creative direction of James Bond franchise FT
Chart of the Day
| Overnight |
| S&P Futures +4
point(s) (+0.1%
) overnight range: -9 to +5 point(s) |
| APAC |
| Nikkei +0.26%
Topix +0.07% China SHCOMP +0.85% Hang Seng +3.99% Korea +0.02% Singapore +0.06% Australia -0.32% India -0.51% Taiwan +1.03% |
| Europe |
| Stoxx 50 +0.30%
Stoxx 600 +0.49% FTSE 100 +0.12% DAX +0.21% CAC 40 +0.40% Italy +0.46% IBEX -0.10% |
| FX |
| Dollar Index (DXY) +0.34%
to 106.73 EUR/USD -0.36% to 1.0463 GBP/USD -0.22% to 1.2641 USD/JPY -0.56% to 150.49 USD/CNY -0.18% to 7.2559 USD/CNH -0.29% to 7.2565 USD/CHF -0.23% to 0.9000 USD/CAD -0.16% to 1.4197 AUD/USD -0.25% to 0.6384 |
| UST Term Structure |
| 2Y-3
M Spread narrowed -0.3bps
to -5.3bps
10Y-2 Y Spread narrowed -1.2bps to 22.2bps 30Y-10 Y Spread narrowed -0.4bps to 23.5bps |
| Yesterday's Recap |
| SPX -0.43%
SPX Eq Wt -0.25% NASDAQ 100 -0.48% NASDAQ Comp -0.47% Russell Midcap -0.82% R2k -0.91% R1k Value -0.48% R1k Growth -0.55% R2k Value -0.80% R2k Growth -1.00% FANG+ -1.04% Semis +0.18% Software -1.83% Biotech +0.21% Regional Banks -1.81% SPX GICS1 Sorted: Fin -1.55% Cons Disc -1.10% Cons Staples -0.96% Comm Srvcs -0.68% Indu -0.68% SPX -0.43% Materials -0.26% Tech -0.06% Utes +0.02% Healthcare +0.55% REITs +0.69% Energy +0.97% |
| USD HY OaS |
| All Sectors +0.6bps
to 309bps All Sectors ex-Energy +0.2bps 289bps Cons Disc +1.5bps 278bps Indu -0.3bps 226bps Tech -0.2bps 310bps Comm Srvcs -0.1bps 498bps Materials +0.7bps 270bps Energy +0.2bps 288bps Fin Snr +0.5bps 259bps Fin Sub +0.4bps 202bps Cons Staples -1.4bps 284bps Healthcare +0.4bps 345bps Utes +0.9bps 221bps * |
| Date | Time | Description | Estimate | Last |
|---|---|---|---|---|
| 2/21 | 9:45 AM | Feb P S&P Manu PMI | 51.4 | 51.2 |
| 2/21 | 9:45 AM | Feb P S&P Srvcs PMI | 53 | 52.9 |
| 2/21 | 10:00 AM | Feb F UMich 1yr Inf Exp | 4.3 | 4.3 |
| 2/21 | 10:00 AM | Feb F UMich Sentiment | 67.8 | 67.8 |
| 2/21 | 10:00 AM | Jan Existing Home Sales | 4.13 | 4.24 |
| 2/21 | 10:00 AM | Jan Existing Home Sales m/m | -2.59 | 2.17 |
| 2/25 | 9:00 AM | Dec Case Shiller 20-City m/m | n/a | 0.41 |
| 2/25 | 10:00 AM | Feb Conf Board Sentiment | 103 | 104.1 |
| 2/26 | 10:00 AM | Jan New Home Sales | 678 | 698 |
| 2/26 | 10:00 AM | Jan New Home Sales m/m | -2.9 | 3.6 |
| 2/27 | 8:30 AM | 4Q S GDP QoQ | 2.3 | 2.3 |
| 2/27 | 8:30 AM | Jan P Durable Gds Orders | 1.8 | -2.2 |
MORNING INSIGHT
Good morning!
Investors have been persistently bearish while S&P 500 making all-time highs. This is rare: In the past 40 years, it has only happened 11 other times, and forward returns have tended to be good in those instances.
Click HERE for more.
TECHNICAL
- Minor consolidation possible in SPX, QQQ before a bottom next week.
- European outperformance looks unlikely to last vs. US as EuroSTOXX tests 2000 highs.
- Silver could be a better risk/reward than Gold for a further Precious metals rally.
Click HERE for more.
CRYPTO
- There is a chance that MSTR flows spark a short-term bounce here, but assets further out on the risk curve continue to face headwinds from ongoing uncertainty surrounding trade and monetary policy.
- Although the current administration takes a pro-crypto stance, there appears to be no immediate catalyst to revive market enthusiasm.
- We still anticipate that crypto will outperform this year, but until we see further progress on trade/monetary policy and renewed inflows into crypto, it may be prudent to raise cash or trim altcoin positions.
Click HERE for more.
First News
Yesterday, Germany reported that the U.S. became its single largest trading partner for the first time since 2015, displacing China for the first time in nearly a decade. However, the U.S.’s chances of retaining that status in 2025 are uncertain, with President Donald Trump threatening a range of tariffs on imports from Europe’s largest economy. Yet U.S. trade policy is just one of the sources of uncertainties that Germany’s voters must consider as they head to the polls this Sunday. Germany’s economy has stagnated since the end of the COVID-19 pandemic, concerns have risen about the country’s immigration and refugee policies, and Germans worry about the status of the Russia-Ukraine war (and Russian aggression in general).
Germany is a federal parliamentary republic with six major political parties vying for enough control of the country’s Bundestag (parliament) to select the country’s leader, the Chancellor. This Sunday’s election is the result of last November’s collapse of a parliamentary alliance between center-left Social Democrats (SPD), the Free Democratic Party (FDP), and the Greens, which left current Chancellor Olaf Scholz (SDP) little choice but to call for national vote.
According to pundits, Friedrich Merz of the center-right Christian Democratic Union (CDU) is favored to become the next chancellor. His party currently has an edge in the polls over the far-right Alternative for Germany (AfD), a party that does not seem to have suffered much from accusations of Nazi sympathies and neo-Nazi associations.
That the CDU and AfD appear to be leading in the polls suggest that of the issues listed above, immigration and refugee policy are top of mind for German voters, with most or many favoring a rightward shift toward significantly stricter limits. The CDU’s Merz is selling himself and his party as the option that would result in stringent limits on immigration without the need to vote for a party that has used banned Nazi slogans and sought to minimize the significance of the Holocaust.
Merz also brings considerable business and finance experience to the table. After unsuccessfully contending with Angela Merkel for leadership of the CDU at the beginning of the millennia, Merz withdrew into the private sector. There, his legal work (including with Mayer Brown) ultimately led him to serve on numerous corporate boards – including those of BlackRock Germany, Deutsche Börse, AXA, HSBC, Commerzbank, and Airbus. His economic platform includes cuts for both corporate tax and personal income tax, less business regulation, and limiting the country’s social safety net.
Yet it’s worth noting that Merz’s hardline stance on immigration and his pro-business sympathies do not necessarily align him with current U.S. leadership. One could argue that the opposite is true. He has expressed strong opposition to Elon Musk’s recent vocal support for the AfD, which he regards as foreign interference in German politics. Furthermore, he has alleged that “we see in America a president who admires autocratic systems,” arguing that with Trump’s recent domestic policy actions, the U.S. is “no longer the America we used to know.”
