A daily market update from FS Insight — what you need to know ahead of opening bell.
“Ideas are like fish. If you want to catch little fish, you can stay in the shallow water. But if you want to catch the big fish, you’ve got to go deeper.” – David Lynch (Jan. 20, 1946 – Jan. 16, 2025)
Overnight
Ozempic is in the next round of Medicare drug price negotiations CNN
SpaceX’s Starship rocket breaks up after launch, flights divert after FAA debris warning CNBC
Israel says Gaza deal reached, prepares for hostage release as soon as Sunday WSJ
Capital One says a ‘technical issue’ is affecting some customers’ ability to access money NBC
Trump Treasury pick Scott Bessent defends sweeping tariffs in contentious Senate hearing YF
World Bank warns that US tariffs could reduce global growth outlook RTR
China GDP growth hits government targets, beating analyst expectations SEM
Cash App parent fined $175 million for ‘woefully incomplete’ response to fraud QZ
A Toyota subsidiary will pay $1.6 billion in a U.S. emissions scandal QZ
Apple suspends error-strewn AI generated news alerts BBC
American Express agrees to pay more than $138M to resolve investigation into sales and marketing AP
India successfully conducts historic space-docking test BBC
China’s population declines for 3rd straight year NYT
‘Once-in-a-century’ discovery reveals spectacular luxury of Pompeii BBC
Chart of the Day
| Overnight |
| S&P Futures +19
point(s) (+0.3%
) Overnight range: -8 to +24 point(s) |
| APAC |
| Nikkei -0.31%
Topix -0.33% China SHCOMP +0.18% Hang Seng +0.31% Korea -0.16% Singapore +0.25% Australia -0.2% India -0.47% Taiwan +0.53% |
| Europe |
| Stoxx 50 +0.69%
Stoxx 600 +0.63% FTSE 100 +1.08% DAX +0.97% CAC 40 +0.96% Italy +1.12% IBEX +0.66% |
| FX |
| Dollar Index (DXY) +0.08%
to 109.04 EUR/USD +0.03% to 1.0304 GBP/USD -0.28% to 1.2205 USD/JPY +0.37% to 155.74 USD/CNY -0.04% to 7.3288 USD/CNH +0.03% to 7.3488 USD/CHF +0.05% to 0.9114 USD/CAD +0.08% to 1.4407 AUD/USD -0.13% to 0.6205 |
| Crypto |
| BTC +2.21%
to 102353.09 ETH +3.13% to 3423.01 XRP +0.03% to 3.2929 Cardano +0.39% to 1.1254 Solana +2.65% to 217.16 Avalanche +3.07% to 41.28 Dogecoin +9.11% to 0.4155 Chainlink +4.29% to 24.26 |
| Commodities and Others |
| VIX -2.95%
to 16.11 WTI Crude +0.57% to 79.13 Brent Crude +0.36% to 81.58 Nat Gas -2.96% to 4.13 RBOB Gas +0.2% to 2.127 Heating Oil +0.39% to 2.627 Gold -0.38% to 2703.98 Silver -0.91% to 30.54 Copper +0.03% to 4.442 |
| US Treasuries |
| 1M -0.1bps
to 4.2953% 3M -1.2bps to 4.286% 6M -1.3bps to 4.2794% 12M -2.0bps to 4.1445% 2Y +0.6bps to 4.2361% 5Y -0.2bps to 4.394% 7Y -0.8bps to 4.4969% 10Y -1.4bps to 4.5986% 20Y -1.8bps to 4.9077% 30Y -2.2bps to 4.8328% |
| UST Term Structure |
| 2Y-3
M Spread narrowed 0.2bps to -8.0
bps 10Y-2 Y Spread narrowed 2.0bps to 36.0 bps 30Y-10 Y Spread narrowed 0.9bps to 23.2 bps |
| Yesterday's Recap |
| SPX -0.21%
SPX Eq Wt +0.79% NASDAQ 100 -0.69% NASDAQ Comp -0.89% Russell Midcap +0.94% R2k +0.15% R1k Value +0.65% R1k Growth -0.74% R2k Value -0.02% R2k Growth +0.32% FANG+ -0.92% Semis +0.43% Software +0.18% Biotech -0.75% Regional Banks -0.94% SPX GICS1 Sorted: Utes +2.58% REITs +2.23% Indu +1.18% Materials +0.81% Energy +0.62% Fin +0.6% Cons Staples +0.55% Healthcare +0.42% SPX -0.21% Cons Disc -0.9% Comm Srvcs -0.95% Tech -1.3% |
| USD HY OaS |
| All Sectors +3.3bp
to 308bp All Sectors ex-Energy +3.7bp to 292bp Cons Disc +0.4bp to 253bp Indu +3.1bp to 235bp Tech +3.2bp to 316bp Comm Srvcs +2.0bp to 495bp Materials +3.1bp to 282bp Energy +5.2bp to 282bp Fin Snr +3.6bp to 270bp Fin Sub -0.3bp to 197bp Cons Staples +2.4bp to 267bp Healthcare +13.9bp to 379bp Utes +5.5bp to 226bp * |
| Date | Time | Description | Estimate | Last |
|---|---|---|---|---|
| 1/17 | 4PM | Nov Net TIC Flows | n/a | 203.566 |
MORNING INSIGHT
Good morning!
To us, this has been a positive week for markets because we saw favorable CPI readings that quelled inflation hysteria. We see signs of market capitulation.
Click HERE for more.
TECHNICAL
- SPX remains in short-term consolidation as part of a longer-term bullish uptrend.
- Treasury yields look to have peaked short-term, which is a positive for Risk assets.
- Downside pressure in AAPL looks to face further weakness next week.
Click HERE for more.
CRYPTO
We see indicators that point to a rosier near-term outlook for crypto, and we also see the potential for upside headline risk post-inauguration.
Click HERE for more.
First News
The global rush to secure critical minerals, metals, and materials is expanding. That’s especially coming into focus as the U.S. and other nations realize their production capabilities are decades behind China’s. The second-largest economy in the world currently dominates the global production in dozens of critical minerals and is not afraid to use that as leverage.
Yesterday, Saudi Aramco, the state-run oil company of Saudi Arabia, announced it would expand its operations in its home country to include mining for lithium, a metal critical for transitioning to electric vehicles and modernizing the world’s power grids. Saudi Aramco’s new initiative will take the form of a joint venture with Ma’aden, a major Riyadh-based mining company.
Saudi Aramco is hardly the only oil company moving into lithium. BP, Shell, Exxon Mobile, and Chevron each have substantive investments in lithium mining and production.
The rush of such critical metals is top of mind for governments and officials of all political persuasions. Though incoming President Donald Trump has made headlines recently touting the security- and military-related reasons for his desire to acquire Greenland, the likely wealth of natural resources deep underground in Greenland’s territory are arguably as important. The U.S. lists 50 “critical minerals” – any substances that are “essential to the economic or national security of the United States,” vulnerable to supply-chain disruptions, and considered so essential that their absence “would have significant consequences for the economic or national security of the United States.”
Greenland is rich in 30 of them, and ironically, melting ice due to climate change is making them more easily accessible.
And it’s not just conservatives who recognize the critical importance of securing supplies of such materials either. In October, the U.S. Treasury Department announced that it would approve clean-energy tax credits to miners involved in the production or extraction of critical minerals. That might have been unexpected coming from a party generally seen to be more focused on environmental concerns, given the ecological damage that mining often leaves behind. As part of this initiative, federal officials during the Biden administration also approved Ioneer Ltd.’s request to mine lithium and boron in Nevada’s Rhyolite Ridge.
Conservationists were outraged, warning that the mine would pollute groundwater and drive an endangered plant to extinction. But as evidenced by the approval, officials paid more heed to the perspective of Ioneer managing director Bernard Rowe, who said simply: “We’ve got one of the largest lithium and boron deposits in the world … It’s basically ready to build.” (The conservationists have since sued the federal government in an effort to reverse the decision.)
