- Market Round Up: Global equity markets trended lower yesterday as the technology sector came under pressure. The S&P 500 fell -0.54%, despite about 350 stocks advancing on the day and the Nasdaq fell -1.18%, whilst the Stoxx 600 ended -0.05%. Yesterday, Nvidia shares recorded its sharpest drop in 10 months after the company’s latest forecast failed to ease concerns about a potential AI bubble. The stock dropped 5.5%, even as Nvidia comfortably beat consensus expectations and reported a 73% jump in fourth quarter revenue. Paramount Skydance secured its $31 per share bid for Warner Bros. after Netflix declined to match the sweetened offer, calling the price unattractive. Netflix shares jumped more than 10% on the news. The merger would create a major new media powerhouse, though it still faces regulatory scrutiny. The outcome marks a notable win for David Ellison and Skydance. Schneider Electric rose 3% after earnings, with results and 2026 guidance broadly in line but still showing solid performance. On the macro front, Applications for US unemployment benefits rose by less than expected to 212k (216k est) last week, indicating that layoffs remain relatively low. Continuing claims declined by 31k to 1833k (1858k est) for the week.
- Day Ahead and Market Drivers: Equities: Asian markets are trading mostly higher this morning with equities trending higher across the region. Japan is up 1.50%, Hong Kong is up 1.17% and China is up 0.30%. Sony shares jumped 7.2% in Japan after the company more than doubled its previously announced share buyback. Chipmakers and related stocks came under pressure, mirroring overnight weakness in the US where the SOX fell 3% following Nvidia’s post earnings selloff. SK Hynix was down -3.5%. On the macro front today, inflation in Germany and Spain is expected to ease, while a pickup is anticipated in France. Overall, underlying price pressures across the Eurozone is expected to remain subdued. In the US, at 13:30 producer price increases will be monitored closely, as any renewed upward pressure could postpone interest rate cuts. At 14:45, MNI Chicago PMI is expected to fall to 52.1 (54.0 prior). Today we get results from Holcim which will have read across for CRH and other cement stocks. Other names of interesting are IAG, which will give some insight into the airline industry which will interest Ryanair shareholders and RIghtMove results will give an indication of the health of the UK’s housing market.
- Stocks in focus: Flutter (Overweight PT $250, 103% upside) – Post Q4 commentary and PT change
- Bonds: German 10-year yields edged down 2bps to 2.69%, UK 10-year yields fell 4bps to 4.27%, and US 10-year yields slipped 5bps to 4.00%.It is light on the issuance front with only the UK issuing shorter dated bills today. From Central bankers, Pill from the BOE will be speaking
- Commodities: Oil is trading firmer this morning with Brent +0.6%, Crude +0.8% as markets await another round of US–Iran talks in Geneva, with ongoing geopolitical uncertainty keeping volatility elevated. Gold is trading steady this morning near the $5,200 level, supported by safe haven demand.
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