Morning Market Preview:
S&P futures are higher, up 8 to 9 points, as…
- Investors await the U.S. Bureau of Labor Statistics’ December Producer Price Index (“PPI”) data for an update on the state of inflation growth.
- The Federal Reserve releases its Beige Book data later this afternoon, an update from the twelve regional banks on economic growth in their districts.
- Federal Reserve Bank of Richmond President Thomas Barkin said the central bank must continue to raise interest rates until it sees inflation growth come back to its 2% target.
- Domestic airline giant United (UAL) said its first quarter and full-year 2023 earnings should easily exceed consensus estimates as travel demand is strong and it remains capacity constrained.
European markets gained as…
- British Consumer Price Index (“CPI”) growth for December continued to ease from a 41-year high observed in October - falling to an annualized rate of 10.5% - though pricing pressures remain extremely tight as food and beverage costs rose at its fastest rate since 1977.
- German Chancellor Olaf Scholz said he’s certain the nation will be able to avoid a recession in 2023 as its power supply is faring better than anticipated so far this winter.
- The European Central Bank was said to consider a plan to raise interest rates by 50 basis points in February and then back off to 25 basis points moving forward.
- European Central Bank Governing Council member Francois Villeroy de Galhau said the regional economy remains resilient, making it easier to raise interest rates.
Asian markets rose as…
- The Bank of Japan left interest rates unchanged, saying economic risks for 2023 are skewed to the downside, and reiterating its commitment to large-scale sovereign bond purchases.
- Chinese Vice Premier Liu He said the nation’s economic growth should rebound as COVID infections subside and the country reopens to the rest of the world.
- The People’s Bank of China added another $76 billion worth of funds to the financial system vis reverse repurchase operations to boost liquidity, bringing the two-day total to $150 billion.
- South Korea’s Financial Supervisory Service Governor Lee Bok-hyun asked banks to make preparations for increasing money-market stability in the event of rising loan defaults.
And ahead of…
- PPI for December (8:30 a.m.)
- Retail Sales for December (8:30 a.m.)
- Industrial, Manufacturing Production for December (9:15 a.m.)
- Fed’s Bullard Speaks (9:30 a.m.)
- Business Inventories for November (10 a.m.)
- NAHB Housing Market Index for January (10 a.m.)
- Fed's Harker Speaks (2 p.m.)
- Fed's Beige Book (2 p.m.)
- American Petroleum Institute Crude Oil Inventory Data (4:30 p.m.)
- Fed's Logan Speaks (5 p.m.)
Japan's Nikkei +2.50%, Japan's TOPIX +1.72%, China's Shanghai Composite unchanged, Hong Kong Hang Seng Index +0.47%, South Korea's KOSPI -0.47%, Taiwan's TSE +0.04%
EuroStoxx 50 +0.25%, UK FTSE +0.05%, German DAX +0.18%, French CAC +0.26%, Italian MIB +0.44%, Spanish IBEX +0.81%
Dollar -0.21%, Japanese Yen +0.71%, Euro +0.38%, British Pound +0.66%, Swiss Franc -0.85%, Chinese Yuan -0.29%
WTI Crude +1.81%
Brent Crude +1.45%
Nat Gas -5.16%
U.S. Treasury 10-yr yield -5.8 bps at 3.48%
U.S. Treasury 2-yr yield -1.9 bps at 4.17%
German 10-yr yield -3.1 bps at 2.06%
French 10-yr yield -4.0 bps at 2.50%
Italian 10-yr yield -5.2 bps at 3.84%
Japanese 10-yr yield -7.2 bps at 0.43%
BMRA, CFST, CSHX, CTBI, FCCO, FNLC, HLFN, JMSB, KISB, NVEC, PBAM, PBCO, PLBC, PTSI, UNB, WAKE, WBBW, WMPN, XDSL, JBHT, SCHW, and PNC before the open.
AA, DFS, FHN, FNBT, FUL, KMI, PFBC, PLD, TCBI, WTFC, and EGBN after the close.
Australia – Consumer Inflation Expectations for January
Bank of Japan Policy Decision
Japan – Industrial Production (Final) for November
Taiwan – GDP for 4Q
U.K. – CPI, PPI for December (2 a.m.)
U.K. – Retail Price Index for December (2 a.m.)
U.K. – ONS House Price Index for November (4:30 a.m.)
ECB's Schnabel Speaks (5:30 a.m.)
MBA 30-Year Rate and Mortgage Applications (7 a.m.)
PPI for December (8:30 a.m.)
Retail Sales for December (8:30 a.m.)
Industrial, Manufacturing Production for December (9:15 a.m.)
Business Inventories for November (10 a.m.)
NAHB Housing Market Index for January (10 a.m.)
Fed's Harker Speaks (2 p.m.)
Fed's Beige Book (2 p.m.)
American Petroleum Institute Crude Oil Inventory Data (4:30 p.m.)
Fed's Logan Speaks (5 p.m.)