Stock Market Update

Equity futures point to a higher opening to begin the holiday-abbreviated week. 

The major averages finished mixed last week due to strong showings from tech names on Thursday and Friday. An uptick in sentiment around the AI trade helped the S&P 500 and Nasdaq Composite reclaim their 50-day moving average. Momentum seems to have extended through the weekend, with mega-cap tech mostly higher in the premarket. 

Headlines are relatively quiet, with no economic data releases scheduled, though tomorrow's session will feature a full data slate. There are no companies set to report earnings this week. 

On the policy front, Cleveland Fed President Beth Hammack (FOMC voting member in 2026) told The Wall Street Journal that she expects rates to remain unchanged for some months, a view that reflects last week's data and Fed commentary that did little to change the market's expectations for further easing. 

The market will close at 1:00 p.m. ET on Wednesday and will be closed all day for the Christmas holiday on Thursday. 

In corporate news:

• The Information reported that OpenAI's margins on its paid products increased this year. 
• NVIDIA (NVDA 184.53, +3.54, +2.0%) is looking to start H200 shipments to China by mid-February, according to Reuters. 
• The Delaware Supreme Court reinstated Tesla (TSLA 497.50, +6.30, +1.3%) CEO Elon Musk's 2018 pay package, according to The New York Times. 

Reviewing overnight developments:

Equity indices in the Asia-Pacific region began the Christmas week on a higher note. Japan's Nikkei: +1.8%, Hong Kong's Hang Seng: +0.4%, China's Shanghai Composite: +0.7%, India's Sensex: +0.8%, South Korea's Kospi: +2.1%, Australia's ASX All Ordinaries: +0.9%.

In news:

• The Japanese yen bounced off its lowest level of the year against the dollar while JGBs retreated, sending yields on the 30-yr bond and shorter tenors to fresh highs for the year.
• Chip names saw renewed strength in Japan and South Korea.
• Softbank reportedly aims to provide its $22.5 bln commitment to OpenAI by the end of the year.
• South Korea's exports through the first 20 days of December were up 6.8% yr/yr with chip exports jumping 41.8%.
• The People's Bank of China made no changes to its one-year (3.00%) and five-year (3.50%) loan prime rates.

In economic data:

• Hong Kong's November CPI 0.0% m/m (last 0.3%); 1.2% yr/yr (last 1.2%)
• India's November Infrastructure Output 1.8% yr/yr (last 0.0%)

Major European indices trade in the red with France's CAC (-0.4%) and U.K.'s FTSE (-0.5%) showing relative weakness. STOXX Europe 600: -0.2%, Germany's DAX: UNCH, U.K.'s FTSE 100: -0.4%, France's CAC 40: -0.4%, Italy's FTSE MIB: -0.1%, Spain's IBEX 35: -0.1%. 

In news:

• European Central Bank policymaker Simkus said that growth has improved, but is still sluggish, and that inflation should stay near the 2.0% target in the medium term.
• A survey from Germany's ifo Institute showed that just over a quarter of German companies expect further deterioration of business in 2026.
• U.S. officials met with representatives from Ukraine and Russia in Florida, but a breakthrough has remained elusive.

In economic data:

• U.K.'s Q3 GDP 0.1% qtr/qtr, as expected (last 0.3%); 1.3% yr/yr, as expected (last 1.4%). Q3 Business Investment 1.5% qtr/qtr (expected -0.3%; last -1.7%); 2.7% yr/yr (expected 0.7%; last 3.2%). Q3 Current Account deficit GBP12.1 bln (expected deficit of GBP19.1 bln; last deficit of GBP21.2 bln)
• Italy's November PPI 1.0% m/m (last -0.2%); -0.2% yr/yr (last 0.1%)