A daily market update from FS Insight — what you need to know ahead of opening bell.
“He that will not sail till all dangers are over must never put to sea.” —Thomas Fuller
Chart of the Day
Good morning!
As we wrote here yesterday, the Trump administration has proposed imposing hefty port fees on U.S. ports of call on ships operated by Chinese shipping companies or made in China. In this, President Donald Trump appears to be registering his dissatisfaction at how China has come to dominate the global commercial shipbuilding industry.
Yet port fees are all but certain to have no effect on this, at least on their own. Economist Marc Levinson, an expert on container shipping, had this to say about the port-fee proposal: “This is not likely to do much for U.S. shipbuilding.” It costs at least twice as much to build ships in the U.S. as elsewhere, and it takes significantly more time as well. Neither China nor South Korea can be blamed for this: “[This] is not a recent development; it’s been the norm for at least the past 100 years,” according to structural engineer and construction expert Brian Potter.
A large part of that is due to plain inefficiency. During World War II, the U.S. ramped up shipbuilding, but a Liberty Ship still took an average 486,000 man-hours to build. The British could build a similar vessel with just 336,000 man-hours. This gap in comparative labor efficiency and manufacturing know-how never diminished and remains to this day – American shipbuilding construction times remain by far the highest in the world.
What might help – though it would undoubtedly take some time – is the SHIPS for America Act, introduced on Dec. 19, 2024 by Sens. Mark Kelly (D-Arizona) and Todd Young (R-Indiana), and by Reps. Trent Kelly (R-Mississippi) and John Garamendi (D-California). The bill appears to enjoy bipartisan support, including from members of the Trump administration. Among other things, this legislation would set a goal of building a fleet of 250 privately owned, US-built, US-flagged, US-crewed vessels; create a shipbuilding financial incentive program to revitalize the U.S. shipbuilding industry; and provide incentives to recruit, train, and retain shipyard workers.
Though introduced during the Biden administration, it’s notable that the bill was also co-sponsored and partially drafted by then-Rep. Mike Waltz (R-Florida), who is now President Trump’s National Security Adviser. Waltz views the initiative as a matter of not just trade, but also national security: “[China] literally could turn off our entire economy by essentially choking off that shipping fleet,” he asserted at the time. If Trump is serious about restoring American shipbuilding, a worthy goal for improving U.S. economic and military security, he will listen to his adviser.
Catch Up With Fundstrat
It’s been a critical week for markets with key earnings announcements alongside economic data. Nvidia’s results, released after market close yesterday, appears “good enough” for the broader market not to deteriorate on fears of softer tech performance. This Friday is Jan Core PCE.
TECHNICAL
Recent selling pressure should be nearly complete after having pulled back to test early February lows. TSLA looks attractive following its break below $300 from a counter-trend perspective, and it looks to be approaching an attractive risk/reward entry.
CRYPTO
Mark Newton use his lens of technical analysis perspective to walk through some key charts and highlight the critical levels he is monitoring for BTC, ETH, SOL, and LTC.
News We’re Following
Breaking News
- Nasdaq futures pace gains for Dow, S&P 500 after Nvidia earnings, Trump tariff vows YF
- Gene Hackman and his wife found dead at their home BBC
Markets and economy
- Nvidia earnings show tech giant remains bullish on AI chip demand SEM
Business
- Trump team weighs pulling funding for Moderna bird flu vaccine BBG
- Amazon is entering the race for practical quantum computing with its new chip QZ
- Nissan, Seven & I deal fallout leaves Japan companies vulnerable BBG
Politics
- Musk gets inside track to take over contract to fix air traffic communications system AP
- Supreme Court grants Trump request to pause foreign-aid payments deadline WSJ
- U.S. and Ukraine prepare to sign minerals deal—with security details unresolved WSJ
Overseas
- Iran expands stockpile of near-weapons grade uranium by 50% SEM
- Succession-like feud engulfs one of Singapore’s richest families BBC
Of Interest
- US records first measles death in a decade amid Texas outbreak SEM
| Overnight |
| S&P Futures +34
point(s) (+0.6%
) Overnight range: -10 to +38 point(s) |
| APAC |
| Nikkei +0.3%
Topix +0.73% China SHCOMP +0.23% Hang Seng -0.29% Korea -0.73% Singapore +0.34% Australia +0.33% India -0.01% Taiwan -1.49% |
| Europe |
| Stoxx 50 -0.73%
Stoxx 600 -0.43% FTSE 100 +0.2% DAX -1.02% CAC 40 -0.27% Italy -1.18% IBEX -0.41% |
| FX |
| Dollar Index (DXY) +0.25%
to 106.68 EUR/USD -0.06% to 1.0479 GBP/USD -0.03% to 1.2672 USD/JPY +0.52% to 149.87 USD/CNY +0.15% to 7.2689 USD/CNH +0.13% to 7.2751 USD/CHF +0.39% to 0.8982 USD/CAD +0.02% to 1.4341 AUD/USD -0.11% to 0.6298 |
| Crypto |
| BTC +2.25%
to 86373.39 ETH +1.03% to 2364.74 XRP +1.33% to 2.2396 Cardano +3.39% to 0.6741 Solana +3.84% to 141.2 Avalanche +6.36% to 23.24 Dogecoin +2.74% to 0.2102 Chainlink +1.98% to 15.66 |
| Commodities and Others |
| VIX -5.81%
to 17.99 WTI Crude +0.89% to 69.23 Brent Crude +0.92% to 73.2 Nat Gas +1.59% to 3.97 RBOB Gas +0.09% to 1.951 Heating Oil +0.66% to 2.36 Gold -0.84% to 2891.93 Silver -0.12% to 31.82 Copper +0.86% to 4.579 |
| US Treasuries |
| 1M -1.6bps
to 4.2708% 3M -0.8bps to 4.288% 6M -0.3bps to 4.3052% 12M -0.3bps to 4.1073% 2Y +4.3bps to 4.1147% 5Y +5.3bps to 4.1362% 7Y +5.6bps to 4.2265% 10Y +5.3bps to 4.3096% 20Y +5.4bps to 4.6088% 30Y +5.2bps to 4.5614% |
| UST Term Structure |
| 2Y-3
M Spread widened 4.1bps to -19.7
bps 10Y-2 Y Spread widened 1.0bps to 19.3 bps 30Y-10 Y Spread narrowed 0.3bps to 24.8 bps |
| Yesterday's Recap |
| SPX +0.01%
SPX Eq Wt -0.21% NASDAQ 100 +0.22% NASDAQ Comp +0.26% Russell Midcap -0.02% R2k +0.19% R1k Value -0.38% R1k Growth +0.4% R2k Value -0.08% R2k Growth +0.44% FANG+ +1.57% Semis +2.34% Software +1.39% Biotech -0.5% Regional Banks +0.26% SPX GICS1 Sorted: Tech +0.89% Utes +0.37% Comm Srvcs +0.09% Indu +0.06% SPX +0.01% Materials -0.07% Fin -0.21% Cons Disc -0.39% Energy -0.49% REITs -0.59% Healthcare -0.69% Cons Staples -1.86% |
| USD HY OaS |
| All Sectors -1.7bp
to 326bp All Sectors ex-Energy -1.7bp to 304bp Cons Disc -1.5bp to 296bp Indu -0.7bp to 246bp Tech -5.4bp to 327bp Comm Srvcs -5.6bp to 512bp Materials -2.1bp to 286bp Energy +1.1bp to 316bp Fin Snr -1.6bp to 275bp Fin Sub +1.0bp to 217bp Cons Staples -3.0bp to 298bp Healthcare +0.1bp to 349bp Utes +2.0bp to 236bp * |
| Date | Time | Description | Estimate | Last |
|---|---|---|---|---|
| 2/27 | 8:30AM | 4Q S GDP QoQ | 2.3 | 2.3 |
| 2/27 | 8:30AM | Jan P Durable Gds Orders | 2.0 | -2.2 |
| 2/28 | 8:30AM | Jan PCE m/m | 0.3 | 0.3 |
| 2/28 | 8:30AM | Jan Core PCE m/m | 0.3 | 0.16 |
| 2/28 | 8:30AM | Jan PCE y/y | 2.5 | 2.6 |
| 2/28 | 8:30AM | Jan Core PCE y/y | 2.6 | 2.79437 |
| 3/3 | 9:45AM | Feb F S&P Manu PMI | n/a | 51.6 |
| 3/3 | 10AM | Feb ISM Manu PMI | 50.5 | 50.9 |
| 3/5 | 9:45AM | Feb F S&P Srvcs PMI | n/a | 49.7 |
| 3/5 | 10AM | Feb ISM Srvcs PMI | 53.0 | 52.8 |