OPENING CALL
Stock futures edged higher on Thursday ahead of retail-sales data for January.
The data won't likely resolve the push-pull over when the Federal Reserve will start to cut interest rates, in part because technical factors could muddy the picture that emerges from the report.
That debate has animated markets this week as stocks and government bonds haven't fully clawed back losses sparked by Tuesday's hot inflation data.
Overseas Markets
Auto stocks boosted stock indexes in Europe after Stellantis and Renault reported earnings.
Premarket Movers
Albemarle said fourth-quarter revenue fell 10% to $2.36 billion on lower lithium market pricing. Shares fell 3.4%.
Cisco Systems' fiscal second-quarter adjusted earnings beat analysts' estimates but its guidance for the third quarter and fiscal year fell well short of estimates. The company also announced it planned to cut about 5% of its workforce under a restructuring plan. Shares were down 5.5%.
Fastly fell 25% after the company reported fourth-quarter revenue below expectations and issued guidance that disappointed.
JFrog guided for another year of steep revenue growth in 2024, forecasting a 21% to 22% increase. Shares were up 22%.
Tripadvisor swung to a profit in the quarter as its revenue rose 10%. Shares were rising 6.8%.
Wednesday's Post-Close Movers
Applovin posted a profit in the fourth quarter as its revenue jumped more than 36%. Shares rose 14%.
Twilio forecast revenue growth of 2% to 3% in the first quarter, below analysts' expectations and a sequential slowdown from the 5% rise in the fourth quarter. Shares fell 11%.
Watch For:
Retail Sales for January; Weekly Jobless Claims; Import Prices for January; Industrial Production & Capacity Utilization for January; NAHB Housing Market Index for February; Business Inventories for December; Canada Housing Starts for January; Canada Manufacturing Survey for December; Earnings from Applied Materials, Deere, DoorDash, DraftKings, Coinbase Global, Trade Desk, SunPower, Roku.
Today's Top Headlines/Must Reads:
- No Big Consumer Price Declines Are in Sight
- Biden Adviser Says Soft Landing Helped by Public Spending Boost
- Immigration Wave Delivers Economic Windfall. But There's a Catch
MARKET WRAPS
Forex:
Markets are currently pricing in more interest-rate cuts by the ECB than by the Fed for this year, and this is supportive of a strong dollar versus the euro, Swissquote Bank said.
"As such, the euro's depreciation against the dollar remains well supported by fundamentals."
However, the hawkish shift from the Fed and a stronger dollar could soften the ECB doves' hand and throw a floor under the EUR/USD selloff, Swissquote added.
UniCredit said the dollar remained "broadly healthy," even while it traded off this week's peaks as long-term yields were a tad lower as well.
Economic data scheduled for release, including retail sales and industrial production numbers, might represent a near-term crossroads for many major exchange rates, it said.
If data releases surprise on the strong side, "investors can be expected to buy the greenback even more intensively," dragging both EUR/USD and GBP/USD lower.
Sterling fell after U.K. GDP data came in weaker than expected.
"Given [Wednesday's] weaker-than-expected inflation print, [the GDP data] will add to the negative GBP momentum over the short-term," MUFG said.
Nonetheless, sterling could later strengthen as Bank of England Bailey's comments on Wednesday indicated that the BOE's focus is on forward-looking indicators.
Bonds:
The 10-year Treasury yield faces higher risks of a further rise, based on technical charts, UOB's Global Economics & Markets Research said.
The 10-year yield broke above the mid-December high of 4.295% on Tuesday, which has boosted the probability of a further yield rise, it said.
However, the yield's upward momentum hasn't substantially increased and must stay above 4.135% to sustain the build-up in momentum, UOB added.
Resistance is now near 4.386%, the top of the daily Ichimoku cloud which is poised to decline in coming days, it said.
Energy:
Oil prices slipped following the publication of a bearish EIA report.
Meanwhile, global natural-gas markets remained under pressure with comfortable storage levels in both the U.S. and Europe as the world moves closer to the end of the heating season, while forecasts for milder weather have added further pressure, ING said.
The IEA said global oil demand is expected to grow at a significantly weaker pace this year, while soaring output from the Americas will help boost supply despite output curbs from OPEC and its allies.
Shell's new outlook for global demand for liquefied natural gas signals significantly higher capacity for the superchilled gas, but also marginally lower demand, RBC Capital Markets said.
"The combination of these two makes for a less bullish long-term picture versus a year ago, with the gap between supply and demand emerging further out post 2030 versus around later this decade previously."
Metals:
Base metals prices eked out some minor gains in early trading, as gold consolidated and negative sentiment from the U.S. inflation print eased.
Macroeconomic-driven volatility is likely to prevail over the coming months, as investors evaluate the data and try to assess the start and scale of monetary policy easing, analysts said.
"The market is currently quiet as China is celebrating the Lunar New Year, but we anticipate an increase in volatility next week," Sucden Financial said.
TODAY'S TOP HEADLINES
Have Uber and Lyft Finally Found a Way to Make Ride-Sharing Profitable?
Longtime money-losing ride-share companies Uber Technologies and Lyft have surprised naysayers by doing what many thought was impossible: racing toward steady profits.
2023 marked Uber's first year of being profitable as a public company. Uber put more gas in its tank Wednesday after it outlined better long-term financial goals during its investor day. Its stock jumped 15%.
Warren Buffett's Berkshire Hathaway Trims Its Massive Stake in Apple
Warren Buffett's Berkshire Hathaway trimmed its flagship position in Apple in the fourth quarter.
Berkshire sold about 1% of its Apple shares in the final three months of 2023, leaving it with a 5.9% stake in the iPhone maker worth about $167 billion on Wednesday, according to Dow Jones Market Data.
BlackRock Alum Launches Fund Focused on 'Weird and Wonderful' Assets
Pam Chan had a coveted job as global head of direct private opportunities at BlackRock, the world's largest asset manager.
She is leaving so she can focus solely on what she loves most: investing in obscure private markets.
New Era of AI Deepfakes Complicates 2024 Elections
The explosion of artificial-intelligence technology makes it easier than ever to deceive people on the internet, and is turning the 2024 U.S. presidential election into an unprecedented test on how to police deceptive content.
An early salvo was fired last month in New Hampshire. Days before the state's presidential primary, an estimated 5,000 to 25,000 calls went out telling recipients not to bother voting.
Biden-Netanyahu Relationship at Boiling Point as Rafah Invasion Looms
The looming Israeli military plans to invade Rafah have exacerbated tensions between Israeli Prime Minister Benjamin Netanyahu's government and the Biden administration, which has grown increasingly frustrated with its attempts to rein in Israel's military campaign.
The consequences of the distrust between President Biden and Netanyahu, who have spoken 18 times since Hamas's Oct. 7 assault, have grown only starker in recent days. Biden now appears to be trying to draw a line with Israel's proposed military operation on Rafah where 1.1 million Palestinians-many of them displaced-now reside.
GOP Lawmaker Warns of 'Serious National-Security Threat'
WASHINGTON-A senior Republican lawmaker publicly warned about an unspecified "serious national-security threat" to the U.S. and requested President Biden to declassify information to allow for open discussion about how to respond to it, a move that sparked confusion in Congress just as lawmakers were debating whether to reauthorize a controversial spying program.
The unusual statement, issued by Rep. Mike Turner of Ohio, the Republican chairman of the House Intelligence Committee, said that classified intelligence had been made available to all members of Congress to review.
Write to ina.kreutz@wsj.com
TODAY IN CANADA
Earnings:
Agnico Eagle Mines 4Q
Canadian Tire 4Q
Cenovus Energy 4Q
Definity Fincl 4Q
Fairfax Fncl Hldgs 4Q
IAMGOLD 4Q
IGM Fincl 4Q
MTY Food 4Q
Mullen Grp 4Q
Sandstorm Gold 4Q
Economic Calendar (ET):
0815 Jan Housing Starts
0830 Dec Manufacturing Survey
Stocks to Watch:
Algoma: Resumes Normal Steel Production; Repair and Restart of Blast Furnace Is Complete and Steel Production Resumed on Feb 11
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Dream Residential REIT 4Q Loss $12.9M
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Primaris REIT 4Q EPS C$0.13; 4Q Rev C$113.8M
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Slate Office REIT FY Rev C$48.8M Vs. C$48.6M
Expected Major Events for Thursday
04:30/JPN: Dec Revised Industrial Production
04:30/JPN: Dec Revised Retail Sales
07:00/UK: Dec UK trade
07:00/UK: Dec Index of production
07:00/UK: Dec Index of services
07:00/UK: 4Q Business investment in the UK: provisional results
07:00/UK: 4Q First quarterly estimate of GDP
07:00/UK: Dec Monthly GDP estimates
09:00/FRA: Feb IEA Oil Market Report
09:00/ITA: Dec Foreign Trade EU
11:00/FRA: Dec OECD Harmonised Unemployment Rates
12:30/UK: Jan NIESR Monthly GDP Tracker
13:00/RUS: Weekly International Reserves
13:15/CAN: Jan Housing Starts
13:30/US: Feb Empire State Manufacturing Survey
13:30/CAN: Dec Monthly Survey of Manufacturing
13:30/US: Jan Advance Monthly Sales for Retail & Food Services
13:30/US: Feb Philadelphia Fed Business Outlook Survey
(MORE TO FOLLOW) Dow Jones Newswires
02-15-24 0622ET
