Stock Market Update

Equity futures point to a lower opening this morning to start the holiday-abbreviated week. 

Stocks finished mostly higher on Friday, but the major averages still finished lower across the board with week-to-date losses wider than 1.0%. Mega-cap stocks performed poorly, while the recent fears of AI disruption that have weighed heavily on software names rippled into some other pockets of the market. 

Tech stocks are lower in the pre-market this morning, weighing on equity futures. 

Headlines are relatively quiet, though there is a smattering of earnings releases in the fold. 

On the geopolitical front, Financial Times reports that Secretary of State Marco Rubio has assured European leaders that the U.S. will not leave NATO. Separately, Reuters reports that the U.S. and Iran are holding diplomatic talks today. 

In corporate news:

• The Pentagon is mulling ending its relationship with Anthropic, according to Axios. 
• The White House is considering forcing data center builders to absorb utility costs, according to CNBC. 
• Apple (AAPL 254.88, -0.90, -0.4%) is expected to release new iPads and Macs on March 4, according to Bloomberg. 
• Micron (MU 402.47, -9.19, -2.2%) is aiming to spend $200 billion to expand memory capacity, according to The Wall Street Journal. 
• Warner Brothers Discovery (WBD 28.76, +0.77, +2.8%) is considering reopening sale talks with Paramount Skydance (PSKY 10.75, +0.43, +4.2%), according to Bloomberg. 

Reviewing overnight developments:

Equity indices in the Asia-Pacific region had a mostly higher start to the week while markets in China, Hong Kong, Singapore, and South Korea were closed for Lunar New Year.  All these markets will remain closed tomorrow with Hong Kong scheduled to reopen on Friday, while China's markets will remain closed until next week. Japan's Nikkei: -0.4%, Hong Kong's Hang Seng: CLOSED, China's Shanghai Composite: CLOSED, India's Sensex: +0.2%, South Korea's Kospi: CLOSED, Australia's ASX All Ordinaries: +0.2%.

In news:

• Japan's Q4 GDP report, which was released on Sunday evening, disappointed, showing growth of just 0.1% quarter-over-quarter (expected 0.4%) while the year-over-year reading was up 0.2% (expected 1.6%). The report pressured rate hike expectations for March, but the market continues expecting a hike to be announced in April.

In economic data:

• Japan's December Tertiary Industry Activity Index 8.40 (last -2.50)
• New Zealand's January FPI 2.5% m/m (last -0.3%)

Major European indices trade mixed. STOXX Europe 600: -0.1%, Germany's DAX: -0.2%, U.K.'s FTSE 100: +0.3%, France's CAC 40: -0.2%, Italy's FTSE MIB: +0.1%, Spain's IBEX 35: +0.2%.

In news:

• The market grew more confident about the probability of a March rate cut from the Bank of England after underwhelming December employment figures from the U.K.
• Miner BHP reported strong results for the first half of its fiscal year and announced a silver streaming agreement with Wheaton Precious Metals.
• Shipper Hapag-Lloyd agreed to acquire ZIM Integrated Shipping.
• Sweden's finance minister said that his country has no plans to adopt the euro in the coming years.

In economic data:

• Eurozone's February ZEW Economic Sentiment 39.4 (expected 45.7; last 40.8)
• Germany's February ZEW Economic Sentiment 58.3 (expected 65.8; last 56.9) and ZEW Current Conditions -65.9 (expected -65.7; last -72.7). January CPI 0.1% m/m, as expected (last 0.0%); 2.1% yr/yr, as expected (last 1.8%)
• U.K.'s December Average Earnings Index + Bonus 4.2% yr/yr (expected 4.6%; last 4.6%). December three-month employment change 52,000 (last 82,000) and December Unemployment Rate 5.2%, as expected (last 5.1%). January Claimant Count change 28,600 (expected 22,800; last 2,700). Q3 Labour Productivity 1.1% (expected -0.6%; last -0.5%)
• Italy's December trade surplus EUR6.037 bln (expected surplus of EUR4.75 bln; last surplus of EUR5.056 bln)