The S&P 500 Index ($SPX) (SPY) today is up +0.13%, the Dow Jones Industrials Index ($DOWI) (DIA) is down -0.10%, and the Nasdaq 100 Index ($IUXX) (QQQ) is up +0.18%. March E-mini S&P futures (ESH26) are up +0.10%, and March E-mini Nasdaq futures (NQH26) are up +0.19%.
Stock indexes are mostly higher today, with the S&P 500 posting a new all-time high and the Nasdaq 100 posting a 1-week high. Stocks are supported by a decline in global bond yields. Today’s weaker-than-expected US Dec ADP employment report was dovish for Fed policy and knocked T-note yields lower, with the 10-year T-note yield down -4 bp to 4.13%.
Also, today’s report showing a slower-than-expected increase in Eurozone Dec core consumer prices eased inflation concerns and knocked European bond yields lower, with the UK 10-year gilt yield falling to a 1.75-month low and the 10-year German bund yield falling to a 1-month low.
The US MBA mortgage applications rose +0.3% in the week ended January 2, with the purchase mortgage sub-index down -6.2% and the refinancing mortgage sub-index up +7.4%. The average 30-year fixed rate mortgage fell -7 bp to 6.25% from 6.32% in the prior week.
The US Dec ADP employment change increased by +41,000, weaker than expectations of +50,000.
The market’s focus this week will be on US economic news. Later today, the Dec ISM services index is expected to slip -0.3 to 52.3. Also, the Nov JOLTS job openings are expected to climb by +9,000 to 7.679 million. Finally, on Wednesday, Oct factory orders are expected to decline by -1.1% m/m. On Thursday, Q3 nonfarm productivity is expected to climb by +4.7%, and unit labor costs are expected to rise by +0.3%. Also, initial weekly unemployment claims are expected to increase by 12,000 to 211,000. On Friday, Dec nonfarm payrolls are expected to increase by +59,000, and the Dec unemployment rate is expected to slip by -0.1 to 4.5%. Also, Dec average hourly earnings are expected to be up by 0.3% m/m and 3.6% y/y. In addition, Oct housing starts are expected to increase by 1.4% m/m to 1.325 million, and Oct building permits are expected to rise by 1.1% m/m to 1.350 million. Finally, the University of Michigan's Jan consumer sentiment index is expected to climb by 0.6 points to 53.5.
The markets are discounting the odds at 18% for a -25 bp rate cut at the FOMC’s next meeting on January 27-28.
Overseas stock markets are mixed today. The Euro Stoxx 50 is down by -0.11%. China’s Shanghai Composite climbed to a 10.5-year high and closed up by +0.05%. Japan’s Nikkei Stock 225 closed down by -1.06%.
Interest Rates
March 10-year T-notes (ZNH6) today are up by +11 ticks. The 10-year T-note yield is down -4.5 bp to 4.128%. The weakness in stocks today has boosted some safe-haven demand for T-notes. Also, today’s weaker-than-expected Eurozone Dec CPI report knocked the 10-year German bund yield to a 1-month low and is providing carryover support to T-note prices. Gains in T-note prices accelerated after the Dec ADP report showed private employment rose less than expected, a dovish factor for Fed policy.
European government bond yields are moving lower today. The 10-year German bund yield dropped to a 1-month low of 2.792% and is down -4.4 bp to 2.798%. The 10-year UK gilt yield fell to a 1.75-month low of 4.400% and is down -7.4 bp to 4.407%.
Eurozone Dec CPI rose +2.0% y/y, right on expectations. Dec core CPI rose +2.3% y/y, weaker than expectations of +2.4% y/y.
German Nov retail sales unexpectedly fell -0.6% m/m, weaker than expectations of a +0.2% m/m increase and the biggest decline in 17 months.
Swaps are discounting a 1% chance of a +25 bp rate hike by the ECB at its next policy meeting on February 5.
US Stock Movers
Chip makers and data storage companies are under pressure today after their sharp rally on Tuesday. Western Digital (WDC) is down more than -8% to lead losers in the S&P 500 and Nasdaq 100. Also, Seagate Technology Holdings (STX) is down more than -7%, and Marvel Technology (MRVL) and Microchip Technology (MCHP) are down more than -3%. In addition, Advanced Micro Devices (AMD) and Texas Instruments (TXN) are down more than -2%, and. NXP Semiconductors NV (NXPI), Lam Research (LRCX), Applied Materials (AMAT), and Analog Devices (ADI) are down more than -1%.
Mining stocks are moving lower today, with silver down more than -4% and copper down more than -1%. Hecla Mining (HL) is down more than -11%, and Coeur Mining (CDE) is down more than -7%. Also, Newmont Mining (NEM), Barrick Mining (B), and Freeport McMoRan (FCX) are down more than -3%.
Apogee Enterprises (APOG) is down more than -12% after cutting its full-year adjusted EPS forecast to $3.40-$3.50 from a previous estimate of $3.60-$3.90, weaker than the consensus of $3.66.
StoneCo Ltd (STNE) is down more than -7% after it announced that CEO Zinner will resign for personal reasons effective March 2026, and CFO Schere was appointed as successor.
AST SpaceMobile (ASTS) is down more than -7% after Scotia Bank downgraded the stock to underperform from sector perform with a price target of $45.60.
Wolverine World Wide (WWW) is down more than -6% after Piper Sandler downgraded the stock to neutral from overweight.
Deckers Outdoors (DECK) is down more than -3% after Piper Sandler downgraded the stock to underweight from neutral with a price target of $85.
JPMorgan Chase (JPM) is down more than -2% to lead losers in the Dow Jones Industrials after Wolfe Research LLC downgraded the stock to peer perform from outperform.
Monte Rosa Therapeutics (GLUE) is up more than +44% after announcing positive interim data from an ongoing Phase 1 clinical study of its drug to treat elevated cardiovascular disease.
Ventyx Biosciences (VTYX) is up more than +37% after the Wall Street Journal reported that Eli Lilly & Co. is in advanced talks to acquire the company for more than $1 billion.
Strategy (MSTR) is up more than +6% to lead gainers in the Nasdaq 100 after MSCI decided for now to keep digital asset treasury companies in its stock market indexes.
Mobileye Global (MBLY) is up more than +5% after acquiring Mentee Robotics in a cash-and-stock deal valued at $900 million to expand its robotics capabilities.
Amgen (AMGN) is up more than +3% to lead gainers in the Dow Jones Industrials after UBS upgraded the stock to buy from neutral with a price target of $380.
Lowe’s (LOW) is up more than 2% after Barclays upgraded the stock to overweight from equal weight with a price target of $285.
Wayfair (W) is up more than +1% after Barclays upgraded the stock to overweight from equal weight with a price target of $123.
Earnings Reports(1/7/2026)
Albertsons Cos Inc (ACI), Constellation Brands Inc (STZ), Jefferies Financial Group Inc (JEF), MSC Industrial Direct Co Inc (MSM).
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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