Stock Market Update

The S&P 500 futures are up four points and are trading 0.1% above fair value, the Nasdaq 100 futures are up 80 points and are trading 0.3% above fair value, and the Dow Jones Industrial Average futures are down 185 points and are trading 0.4% below fair value.

Contracts tied to the S&P 500 and Nasdaq 100 are higher while futures linked to the Dow industrials move down, clipped by a pre-open decline in UnitedHealth (UNH). Shares are 10% lower in premarket trading on news of a Department of Justice civil investigation of Medicare Advantage billing practices, according to The Wall Street Journal.

Today's economic lineup includes the flash February S&P Global U.S. Manufacturing PMI and flash February S&P Global U.S. Services PMI readings at 9:45 ET, and the January Existing Home Sales and final February University of Michigan Consumer Sentiment survey at 10:00 ET. 

The 10-yr yield is down one basis point to 4.49% and the 2-yr yield is down one basis point to 4.26%. 

In corporate news:

• Booking Holdings (BKNG 5,125.00, +106.77, +2.1%): beats by $5.47, beats on revs; increasing dividend 10%; says at the start of 2025, it continues to see healthy demand for leisure travel globally
• UnitedHealth (UNH 453.50, -48.92, -9.8%): trading on report of DOJ civil investigation of Medicare Advantage billing practices, according to WSJ
• Live Nation (LYV 153.66, +1.34, +0.9%): beats on revs
• Block (XYZ 75.50, -7.54, -9.1%): misses by $0.17, misses on revs
• Rivian Automotive (RIVN 13.11, -0.50, -3.7%): misses by $0.02, beats on revs, delivered 14,183 vehicles; Guides for FY25 deliveries of 46,000-51,000

Reviewing overnight developments:

• Equity indices in the Asia-Pacific region ended the week on a mostly higher note with Hong Kong's Hang Seng (+4.0%) continuing its recent outperformance. Japan's Nikkei: +0.3% (-1.0% for the week), Hong Kong's Hang Seng: +4.0% (+3.8% for the week), China's Shanghai Composite: +0.9% (+1.0% for the week), India's Sensex: -0.6% (-0.8% for the week), South Korea's Kospi: UNCH (+2.5% for the week), Australia's ASX All Ordinaries: -0.4% (-2.9% for the week).
  • In economic data:
    • Japan's January CPI 0.5% m/m (last 0.6%). January National CPI 4.0% yr/yr (last 3.6%) and National Core CPI 3.2% yr/yr (expected 3.1%; last 3.0%). Flash February Manufacturing PMI 48.9 (expected 49.0; last 48.7) and flash February Services PMI 53.1 (last 53.0)
    • India's flash February Manufacturing PMI 57.1 (last 57.7) and flash Services PMI 61.1 (last 56.5)
    • Australia's flash February Manufacturing PMI 50.6 (last 50.2) and flash Services PMI 51.4 (last 51.2)
    • New Zealand's January trade deficit NZD486 mln (expected surplus of NZD225 mln; last surplus of NZD94 mln)
  • In news:
    • The Japanese yen retreated from its best level against the dollar since early December after Bank of Japan Governor Ueda said that the central bank is ready to react to rising bond yields and respond "nimbly if markets make abnormal moves."
    • Reserve Bank of Australia Governor Bullock repeated that the domestic economic outlook remains uncertain.
• Major European indices are looking for a modestly higher finish to the week. STOXX Europe 600: +0.5% (+0.2% week-to-date), Germany's DAX: +0.1% (-0.7% week-to-date), U.K.'s FTSE 100: +0.1% (-0.7% week-to-date), France's CAC 40: +0.5% (-0.2% week-to-date), Italy's FTSE MIB: +0.4% (+1.1% week-to-date), Spain's IBEX 35: -0.2% (-0.1% week-to-date).
  • In economic data:
    • Eurozone's flash February Manufacturing PMI 47.3 (expected 46.9; last 46.6) and flash Services PMI 50.7 (expected 51.5; last 51.3)
    • U.K.'s January Retail Sales 1.7% m/m (expected 0.4%; last -0.6%); 1.0% yr/yr (expected 0.6%; last 2.8%). January Core Retail Sales 2.1% m/m (expected 0.9%; last -0.9%); 1.2% yr/yr (expected 0.5%; last 2.1%). January Public Sector Net Borrowing -GBP15.44 bln (expected -GBP20.10 bln; last GBP18.12 bln). Flash February Manufacturing PMI 46.4 (expected 48.5; last 48.3) and flash Services PMI 51.1 (expected 50.8; last 50.8)
    • Germany's flash February Manufacturing PMI 45.5 (expected 45.3; last 45.0) and flash Services PMI 52.2 (expected 52.4; last 52.5)
    • France's February Business Survey 97 (expected 96; last 96). Flash February Manufacturing PMI 45.5 (expected 45.3; last 45.0) and flash Services PMI 44.5 (expected 48.8; last 48.2)
  • In news:
    • Flash February Manufacturing and Services PMI readings from major economies were mixed relative to expectations, though all pointed to continued weakness in manufacturing.
    • Germany will hold a snap election on Sunday, which is likely to result in new leadership. Observers will be particularly interested in the support received by the fast-growing AfD party.