Stock Market Update

Equity futures are flat this morning following yesterday's session that saw the major averages finish with modest gains after a since-refuted midday headline of the Fed Chairman's potential firing caused some volatility.

The market responded favorably to yesterday's release of the June PPI, which saw PPI and Core PPI remain stable month-over-month. Though perhaps not as directly correlated with inflation, today's release of Retail Sales and Jobless Claims Data at 8:30 ET will likely further influence the market's view of economic health.

Tariff headlines have been relatively subdued since Monday. Bloomberg reports that President Trump is considering 10-15% tariff rates for roughly 150 nations, though these are mostly smaller nations that are less consequential trade partners. 

Additionally, Financial Times reported that the EU is preparing retaliatory tariffs on U.S. tariffs and export controls, following the announcement of a 30% tariff on the EU on Saturday.

The market also has a fresh wave of earnings reports before the open to digest.

In corporate news:

• Abbott Labs (ABT 125.18, -6.56, -5.0%): beat Q2 EPS expectations, issued below-consensus EPS guidance for Q3, and in-line EPS guidance for FY25.
• GE Aerospace (GE 269.65, +3.47, +1.3%): beat Q2 expectations and raised its EPS guidance for FY25.
• Taiwan Semiconductor Manufacturing (TSM 245.50, +7.94, +3.3%): beat Q2 EPS expectations and issued above-consensus revenue guidance for Q3.
• Travelers (TRV 253.00, +0.81, +0.3%): beat Q2 expectations.
• PepsiCo (PEP 138.01, +2.66, +2.0%): beat Q2 expectations.
• United Airlines (UAL 87.25, -1.22, -1.4%): beat Q2 EPS expectations on below-consensus revenue and issued in-line EPS guidance for FY25.
• US Bancorp (USB 43.88, -1.80, -3.9%): beat Q2 EPS expectations and issued above-consensus revenue guidance for FY25.
• Sarepta Therapeutics (SRPT 23.99, +5.61, +30.5%): announced restructuring plans, job cuts, and named new CFO and COO.

Reviewing overnight developments:

• Asian markets ended mostly higher. Japan's Nikkei +0.6%, Hong Kong's Hang Seng -0.1%, China's Shanghai Composite +0.4%
  • In economic data:
    • Japan's June trade surplus JPY153.1 bln (expected surplus of JPY353.9 bln; last deficit of JPY638.6 bln). June Imports 0.2% yr/yr (expected -1.6%; last -7.7%) and Exports -0.5% yr/yr (expected 0.5%; last -1.7%)
    • Singapore's June trade surplus SGD9.71 bln (last surplus of SGD7.26 bln). June non-oil exports 14.3% m/m (last -12.4%); 13.0% yr/yr (expected 5.0%; last -3.9%)
    • Hong Kong's June Unemployment Rate 3.5% (last 3.5%)
    • Australia's July MI Inflation Expectations 4.7% (last 5.0%). June Employment Change 2,000 (expected 21,000; last -1,100) and full employment change -38,200 (last 38,700). June Unemployment Rate 4.3% (expected 4.1%; last 4.1%) and Participation Rate 67.1% (expected 67.0%; last 67.0%)
    • New Zealand's June FPI 1.2% m/m (last 0.5%)
  • In news:
    • There is a growing likelihood that the U.S. will not reach a trade deal with Japan by the end of the month, though Japan's top trade negotiator said that in-depth talks are being held with the U.S.
    • Australia reported weak employment figures for June, prompting speculation about the Reserve Bank of Australia being behind the curve when it comes to rate cuts § Nomura expects the Reserve Bank of Australia to make three cuts by February
• Major European indices trade in the green. Germany's DAX +0.5%, U.K.'s FTSE +0.5%, France's CAC +0.9%
  • In economic data:
    • Eurozone's June CPI 0.3% m/m, as expected (last 0.0%); 2.0% yr/yr, as expected (last 1.9%). June Core CPI 0.4% m/m, as expected (last 0.0%); 2.3% yr/yr, as expected (last 2.3%)
    • U.K.'s May Average Earnings Index + Bonus 5.0% yr/yr, as expected (last 5.4%). June Claimant Count Change 25,900 (expected 17,900; last 15,300), May three-month employment change 134,000 (expected 46,000; last 89,000), and May Unemployment Rate 4.7% (expected 4.6%; last 4.6%)
    • Swiss June trade surplus CHF5.79 bln (expected surplus of CHF4.22 bln; last surplus of CHF4.01 bln)
  • In news:
    • The U.K.'s unemployment rate stayed on an upward trend in May, reaching 4.7%, its highest level in nearly four years
    • The EU is reportedly preparing a list of U.S. services that could be hit with tariffs on top of planned tariffs on imports of U.S. goods
    • EasyJet reported solid quarterly results but warned that profit in the current quarter will be hit by an air traffic controller strike in France