Stock Market Update

Equity futures point to a flat opening this morning after a solid start to the week that saw the DJIA notch record highs as cyclical stocks excelled. 

The market had an overall muted response to the capture of Venezuelan President Nicolas Maduro over the weekend. However, a number of energy stocks saw gains close to double digits as investors reacted to the possibility of U.S. companies getting involved in Venezuela's oil production. President Trump told CBS News that the U.S. is not at war with Venezuela, though he is "in charge" of the country. The president said it will take less than 18 months to rebuild the country's energy infrastructure, and the U.S. might reimburse the oil companies involved. 

Headlines are relatively quiet elsewhere as the market navigates the stretch of time between the holidays and the next earnings season. Yesterday marked the last session of the "Santa Claus rally period," which resulted in a flat showing from stocks over the holidays. 

NVIDIA (NVDA 189.24, +1.12, +0.6%) is up modestly in the premarket following comments from CEO Jensen Huang at the Consumer Electronics Show in Las Vegas regarding chip demand in China and the company's next-generation chip production. Mega-caps as a whole are mixed and flattish this morning. 

The market will receive the final reading of the December S&P Global U.S. Services PMI at 9:45 a.m. ET. 

In corporate news:

• Senators discuss extending Affordable Care Act subsidies for 2 months before a new plan is passed, according to Politico.
• Dell (DELL 124.50, +0.49, +0.4%) is aiming to expand its personal computer portfolio, according to The Wall Street Journal. 
• Eli Lilly (LLY 1,043.11, +1.60, +0.2%) cuts the price of Mounjaro in China, according to Bloomberg. 
• NVIDIA (NVDA 189.24, +1.12, +0.6%) CEO Jensen Huang said its next-generation Vera Rubin chip is in full production and expected to debut later this year, according to Reuters.  Additionally, Bloomberg reports that the company has seen strong demand in China for its H200 chip. 

Reviewing overnight developments: 

Equity indices in the Asia-Pacific region ended Tuesday on a mostly higher note with Japan's Nikkei (+1.3%) and South Korea's Kospi (+1.5%) settling at fresh record highs. Japan's Nikkei: +1.3%, Hong Kong's Hang Seng: +1.4%, China's Shanghai Composite: +1.5%, India's Sensex: -0.4%, South Korea's Kospi: +1.5%, Australia's ASX All Ordinaries: -0.4%.

In news:

• The Chinese government has reportedly started selling local government bonds to increase investment.
• China's Ministry of Commerce will tighten control over exports of dual-use items to Japan.
• The People's Bank of China said that monetary policy will be maintained at an appropriately loose level with reserve requirement ratio cuts and interest rate cut flexibility this year.

In economic data: 

• Japan's December Monetary Base -9.8% yr/yr (expected -8.0%; last -8.7%)
• Hong Kong's December Manufacturing PMI 51.9 (last 52.9)
• India's December Services PMI 58.0 (expected 59.1; last 59.8)
• Australia's December Services PMI 51.1 (expected 51.0; last 52.8)

Major European indices trade on a mostly higher note while France's CAC (-0.4%) lags amid weakness in bank stocks and consumer names. STOXX Europe 600: +0.3%, Germany's DAX: +0.4%, U.K.'s FTSE 100: +0.9%, France's CAC 40: -0.3%, Italy's FTSE MIB: +0.4%, Spain's IBEX 35: +0.4%.

In news:

• Eurozone's final Services PMI (52.4) reading for December showed a deceleration from the flash reading (52.6) and the final November reading (53.6).
• Germany's final December CPI will be released at 8:00 ET and it is expected to show CPI slowing to 2.0% yr/yr from 2.3%.
• Meanwhile, France's CPI decelerated to 0.8% from 0.9%, an outcome that was praised by Bank of France Governor Villeroy de Galhau.

In economic data:

• Eurozone's final December Services PMI 52.4 (expected 52.6; last 53.6)
• Germany's final December Services PMI 52.7 (expected 52.6; last 53.1)
• U.K.'s final December Services PMI 51.4 (expected 52.1; last 51.3)
• France's flash December CPI 0.1% m/m (expected 0.2%; last -0.2%); 0.8% yr/yr (expected 0.9%; last 0.9%). Final December Services PMI 50.1 (expected 50.2; last 51.4)
• Italy's final December Services PMI 51.5 (expected 54.2; last 55.0)
• Spain's final December Services PMI 57.1 (expected 54.8; last 55.6)