S&P futures down 0.2% Wednesday morning after a mixed session on Tuesday, where energy, chemicals, steel, banks, beverages, and China tech outperformed while medical devices, copper, asset managers, payments, hotels, airlines, cruise lines, autos, and dollar stores lagged. Asian markets were higher overnight, with Hong Kong surging over 2.5%, while European markets were up ~0.1%. Treasuries were slightly weaker after Tuesday’s yield increase. The dollar index was little changed, with yen weakness dominating FX. Gold fell 0.6%, Bitcoin futures declined 0.2%, and WTI crude dropped 1%.
Markets remain in a holding pattern ahead of January CPI, Trump’s reciprocal tariff details, and the upcoming shift to January Q earnings, which will be dominated by tech and retail. Key focus areas include policy uncertainty, the lack of GOP consensus on a reconciliation bill, Q4 earnings strength, broadening earnings growth, softer guidance trends, divergent inflation expectations, Mag 7 performance, China tech stock outperformance, and higher energy prices.
January CPI is the economic highlight today, with core CPI expected to rise +0.3% m/m (vs. +0.2% in December) while the y/y rate is expected to ease to +3.1% from +3.2%. Market focus remains on used car prices, auto insurance, OER, and seasonal adjustments. Powell continues his monetary policy testimony, with additional comments from Atlanta Fed President Bostic. Treasury supply includes a $42B 10-year note auction.
Sector and Company News
Healthcare
- Gilead (GILD-US): Beat earnings and guided above expectations, with strong HIV franchise performance.
- Edwards Lifesciences (EW-US): Reported organic growth ahead of expectations, with a TAVR beat.
- STAAR Surgical (STAA-US): Down significantly on weaker China demand.
Technology
- Super Micro Computer (SMCI-US): Gained on an upbeat 2026 outlook.
- Confluent (CFLT-US): Boosted by strong earnings and an expanded partnership with Databricks.
- Teradata (TDC-US): Down on a cloud ARR miss and weaker-than-expected guidance.
Consumer & Financials
- DoorDash (DASH-US): Gross order volume exceeded expectations.
- Lyft (LYFT-US): Declined as pricing pressures weighed on bookings.
- Upstart (UPST-US): Jumped on strong volumes and an improved outlook.
- Zillow (ZG-US): Q1 guidance came in below expectations due to a tougher housing market.
- BlackLine (BL-US): Down sharply on deal slippage and FX headwinds.
Industrials & Autos
- Allison Transmission (ALSN-US): Declined on softer guidance.
- Avis Budget Group (CAR-US): Positive demand commentary but took a large non-cash fleet charge.
US equities were mixed on Tuesday, with the Dow (+0.28%) and S&P 500 (+0.03%) posting slight gains while the Nasdaq (-0.36%) and Russell 2000 (-0.53%) declined. Stocks struggled for direction following Monday’s gains. Outperformers included refiners, oil majors, chemicals, steel and aluminum, banks, media, beverages (KO-US), railways, and China tech. Big tech mostly declined, with TSLA-US a notable laggard, though AAPL-US outperformed on AI headlines. Underperformers included medical devices, copper, asset managers, payments (FIS-US), hotels (MAR-US), airlines, cruise lines, auto suppliers, casual diners, dollar stores, and E&Cs. Treasuries weakened, with the curve steepening after a mixed performance on Monday. The dollar index declined 0.4%. Gold finished down 0.1%, Bitcoin futures fell 2.5%, and WTI crude climbed 1.3%, following a 2% jump on Monday.
Broader narratives remain unchanged as markets await clarity on Trump 2.0 policies and their potential economic impact. Trump formally signed 25% tariffs on steel and aluminum imports, with reciprocal tariff details expected soon. AI optimism continues to drive upside momentum, supported by the AAPL-US/BABA-US partnership. Investors are also focused on Wednesday’s January CPI report following mixed inflation data and expectations. However, concerns persist around a hawkish Fed, weakening consumer strength, AI/capex risks, extended tech valuations, and market concentration. Bullish narratives include continued retail buying, improved positioning, and modest dollar weakness.
The NFIB small business optimism index for January declined but remained above long-term averages, highlighting rising uncertainty and hiring challenges. Fed Chair Powell, in testimony to the Senate Banking Committee, stated the FOMC is in no hurry to adjust policy and reiterated upside inflation risks. Cleveland Fed’s Hammack echoed Powell’s sentiment, while NY Fed’s Williams stated policy remains well-positioned to reach the Fed’s 2% target. A $58B 3-year note auction was well received. Looking ahead, Wednesday brings the CPI report, Powell’s second day of testimony, comments from Atlanta Fed President Bostic, and a $42B 10-year note auction. Thursday features PPI, initial jobless claims, and a $25B 30-year bond auction. Friday rounds out the week with retail sales, import/export prices, industrial production, and business inventories.
Sector and Company News
Technology
- Apple (AAPL-US): Partnering with Alibaba (BABA-US) to bring AI features to iPhone users in China.
- Intel (INTC-US): Up after VP Vance said the White House would ensure the most powerful AI systems are manufactured in the US.
- Lattice Semiconductor (LSCC-US): +7.7% following in-line Q4 revenue and earnings, record design wins, and positive Q1 guidance.
- Amkor Technology (AMKR-US): -11.4% on weaker-than-expected Q4 revenue and disappointing Q1 guidance, citing AI data center supply chain challenges and geopolitical risks.
Consumer Discretionary
- Tesla (TSLA-US): Declined on weak demand concerns and pressure from competition in China.
- Shopify (SHOP-US): Beat earnings expectations with strong gross merchandise volume; outlook commentary was positive but expectations were already high.
- Marriott International (MAR-US): -5.4% despite strong Q4 RevPAR growth of +5%; FY25 EPS guidance below consensus due to weak performance in Greater China.
- Match Group (MTCH-US): CEO purchased ~$2M in shares.
Energy & Industrials
- Phillips 66 (PSX-US): +4.7% after reports that Elliott has built a $2.5B+ stake and is pushing for a midstream business spinoff.
- BP (BP-US): Promised a “fundamental reset” in response to a sharp Q4 earnings decline and Elliott stake.
- Carrier Global (CARR-US): -1.6% after mixed Q4 results, with organic growth slightly below consensus; commercial HVAC backlog supported by data center acceleration.
Financials
- JPMorgan Chase (JPM-US): +1.5% after COO Piepszak stated at a BofA conference that Q1 trading revenue and investment banking fees could rise double-digits year-over-year.
- Fidelity National Information Services (FIS-US): -11.5% on mixed Q4 results; EPS guidance ahead but revenue and EBITDA guidance disappointed.
- Cincinnati Financial (CINF-US): +2.8% after a strong Q4 earnings beat, driven by solid underwriting results and lower-than-expected catastrophe losses.
- Carlyle Group (CG-US): -3.7% following a miss on after-tax distributable earnings and weaker-than-expected fee-related earnings.
Healthcare
- Humana (HUM-US): Missed Q4 expectations and guided below for 2025.
- Medpace Holdings (MEDP-US): -7.5% despite Q4 revenue and earnings beats; book-to-bill ratio missed consensus at 0.99x.
- Coty (COTY-US): -9.3% on mixed Q2 results and lowered FY25 guidance due to FX headwinds and slowing growth in US mass beauty.
Materials & Industrials
- DuPont (DD-US): +6.9% on Q4 EPS and revenue beats, citing strength in electronics and water/medical packaging markets.
- Fluence Energy (FLNC-US): -46.4% after missing Q1 revenue, EBITDA, and EPS estimates and cutting FY25 guidance due to Australian contract delays.
- Ecolab (ECL-US): +6.2% following Q4 earnings and revenue beats, driven by growth in global healthcare & life sciencees
Communications Services
- Viasat (VSAT-US): -21.0% after disclosing plans to exit certain ground network infrastructure locations in EMEA, leading to a Q4 impairment charge of $130M-$180M.
Eco Data Releases | Wednesday February 12th, 2025
S&P 500 Constituent Earnings Announcements | Wednesday February 12th, 2025
Data sourced from FactSet Research Systems Inc.
