Daily Game Plan

TODAY’S GAME PLAN:  from the trading
desk, this is not research

TODAY’S ECONOMIC DATA:   8:30ET Empire Manufacturing, Philadelphia Fed Business Outlook, Initial Jobless Claims,
Import Price Index YoY, Export Price Index YoY: Fed’s Goolsbee speaks; 8:35ET Fed’s Bostic speaks; 9:15ET Fed’s Barr speaks; 12:30ET Trump meets Venezuela opposition leader María Corina Machado; 1:30ET Fed’s Schmid speaks; 2:00ET TIC Flows

Highlights and News:  

• TSMC’s Strong Outlook Fires Up Hopes of Sustained AI Boom
• Trump Threatens to Use the Insurrection Act in Minnesota
• Oil Tumbles After Trump Signals US Response to Iran Is On Hold
• Silver Tumbles After Trump Holds Off on Critical Mineral Tariffs
• US is Pressing Mexico to Allow US Forces to Fight Cartels: NYT
• Trump says he has no plan to fire Fed’s Powell despite investigation
• Goldman Equity Traders Smash Wall Street Record
  

Global stocks show a mixed but generally recovering tone led by a tech/AI rebound after recent pullbacks. After a week filled with geopolitical tensions and Trump
wild cards, the AI story is back and boosting stocks after TSMC’s strong outlook fires up hopes of sustained AI boom. TSMC said it is accelerating its global capacity buildout, most notably in the US, to meet future demand. Upbeat economic growth data in the
UK prompted traders to dial back bets on Bank of England interest-rate cuts. Germany’s troubled economy returned to modest growth last year after two years of falling output, official figures showed, as hopes rise that government spending on infrastructure
and defense may help end years of stagnation. South Korea’s central bank left its benchmark interest rate unchanged at 2.5% for a fifth straight meeting, effectively adopting a neutral stance.
In geopolitics, China banned cybersecurity products from American and Israeli firms. Germany will take the lead of European nations sending military personnel to Greenland.

EQUITIES: 

US equity futures are higher, led by Nasdaq as technology stocks bounced back after TSMC’s guidance for 30% revenue growth and a more than 30% increase in capital spending in 2026. TSMC
said they will spend $55B on capital spending for 2026, renewing optimism around AI following weeks of steady rotation away from mega-cap tech stocks and toward a broader set of companies. TSMC suppliers Applied Materials and Lam Research Corp. rose more than
7% in premarket trading. The US levied a 25% tariff on imports of certain advanced semiconductors, a key step in allowing Nvidia to ship Taiwan-made H200 AI processors to China. Paramount Skydance named a new CFO as it continues to fight for control of Warner
Bros. Ocular Therapeutix rose as much as 25% in premarket trading following a report that Sanofi SA is preparing a higher takeover offer for the firm. BlackRock pulled in $342 billion of total client cash in the fourth quarter, pushing the firm to a record
$14 trillion of assets. Goldman Sachs Group netted $4.31 billion in equities-trading revenue in the final three months of last year, an all-time Wall Street record. Key influences today besides bank earnings include a slew of Fed speakers, plus ongoing geopolitical
notes with softened US-Iran tensions easing some oil-related fears.

Futures ahead of the bell: E-Mini S&P +0.5%, Nasdaq +1%, Russell 2000 +0.1%, DJI -0.05%.

In pre-market trading, Chip equipment stocks (LRCX +8.2%, TER +4.1%) lead gains in the semiconductor sector in US premarket trading, after TSMC set its 2026 capital
spending target above investor expectations, signaling confidence in the AI boom. US-listed shares of Taiwan Semiconductor Manufacturing Co. are up 6.8% after the chipmaker’s results and forecast were seen as strong.  Morgan Stanley (MS) shares reverse an
initial gain of 2% after the bank reported wealth management net revenue for the fourth quarter that beat the estimates. Morgan Stanley also topped estimates and its debt-underwriting revenue rose 93%. Amplitude shares (AMPL) gain 5.7% after Morgan Stanley
raised the software firm to overweight from equal-weight. Applied Materials shares (APLD) rise 2.1% as Barclays upgrades to overweight from equal-weight. The chip-tool maker is also getting a boost after TSMC set a bullish capital spending target, signaling
strong demand for AI chips. BlackRock shares (BLK) are up 2.2% after the asset manager reported adjusted EPS and net inflows that came in above the average analyst estimates. Clearway Energy shares (CWEN) advance 7.5% after the clean energy company announced
a portfolio of power purchase agreements with Google. Disc Medicine shares (IRON) slide 7.1% after the FDA delayed the review of its experimental drug to treat a rare blood disorder. Penumbra shares (PEN) jump 13% after Boston Scientific agreed to buy the
company. Talen Energy Corporation shares (TLN) rise 11% after it signed agreements to acquire three natural gas power plants from Energy Capital Partners.

Market Movers of Note:

• RILY US (+30%): BRC Group Files Report Just Ahead of Nasdaq Compliance Deadline
• OCUL US (+11%): Ocular Rallies After Report of Sanofi Preparing Higher Bid
• TSM US (+5.3%): TSMC 2026 Sales to Grow by Close to 30% in USD Terms; Capex
• AMAT US (+5.8%): Applied Materials Rises on Barclays Upgrade, TSMC Capex Boost
• LRCX US(+5.9%), ENTG US(+5.2%), KLAC US(+5.1%), AMKR US(+5.0%), TER US(+4.7%), ASML US (4.5%): ASML, Chip Equipment Peers Rally on TSMC’s Capex Budget
  Hike 
• SNDK US (+4.6%): SanDisk’s Stunning Pop Tops S&P 500 Leaderboard: Equity Insight
• FUBO US (+3.9%): FuboTV Gains on $140.2M Repurchase of Convertible Senior Notes
• MU US (+3.5%): Nvidia, Micron, Marvell Are All Rated New Outperform at RBC
• OKLO US (+2.2%): Labor Shortages May Hinder Power-Plant Buildout, Oklo CEO Says
• DKNG US (+1.9%): DraftKings Raised to Overweight at Wells Fargo; PT $49

European gauges extended a record-breaking advance with the Stoxx Europe 600 Index reaching an all-time peak. Chip-equipment makers lead gains within the tech sector
following solid results from Taiwan Semiconductor Manufacturing Co.  Autos and energy sectors lead declines. ASML Holding NV, which counts TSMC as its biggest customer, jumped more than 6% to a record high in Amsterdam. Energy providers are among the biggest
laggards after Trump indicated that he might hold off on attacking Iran. VAT Group shares gain as much as 18% as preliminary net sales for the full year show an earlier upswing than analysts had previously expected. Schroders gained as much as 8.9% after the
asset management said annual adjusted operating profit will come in ahead of expectations. Swedbank shares jump as much as 6.7% to a record high after the US Department of Justice closed a yearslong investigation without imposing penalties. Ashmore Group shares
rally more than 18% after the emerging markets-focused asset manager reported the first monthly net inflows since 2021. Repsol shares drop as much as 7% after the Spanish oil company released a trading statement with a miss on upstream production. Dunelm shares
slide as much as 18% after the homeware retailer reported softer-than-expected results. Stoxx 600 +0.5%, DAX +0.1%, CAC -0.1%, FTSE 100 +0.5%. Tech +2.9%, Real Estate +1.5%. Autos -1%, Energy -0.6%.

Shares in Asia were mixed, with the MSCI Asia Pacific Index rising slightly after fluctuating during the day. Heavyweight TSMC slid 1.2% ahead of earnings while Japan’s
Advantest lost 2.5%. Trip.com shares were another big drag, plunging about 20% in Hong Kong after Chinese regulators said the online travel agency was being investigated over alleged antitrust conduct. Chinese property stocks rise after China said it will
continue to offer personal income tax rebates for taxpayers who purchase a home within a year after they sell a home. Nikkei drops almost 1% and Hang Seng Tech Index slumps more than 1%. Kospi and Philippine indexes are regional bright spots. TSMC, Asia’s
most valuable company, released strong earnings and guidance after the close. The company expects revenue growth of close to 30% in 2026, faster than analyst estimates, due to demand for AI accelerators. Kospi +1.6%, Philippines +1.5%, Thailand +1.4%, Topix
+0.7%, Indonesia +0.5%, ASX 200 +0.5%, Singapore +0.4%, CSI 300 +0.2%. Hang Seng Index -0.3%, Shanghai Composite -0.3%, Taiwan -0.4%, Nikkei 225 -0.4%, Hang Seng Tech -1.3%, Vietnam -1.6%.

FIXED INCOME: 
 

Treasury yields move higher led by the short end after the economic data reports this morning. 10-year yield is up 3bps around 4.16%; 2s10s-1.5bps; 5s30s -3.5bps.
Front-end tenors lead gilts selloff after UK GDP beat estimates, curbing wagers on BOE rate cuts. US session includes weekly jobless claims data and five scheduled Fed speakers.

METALS: 

Metals fell from all-time highs with silver tumbling as President Trump held off on critical mineral tariffs. Trump said he would negotiate bilateral agreements to
ensure adequate supplies of critical minerals, floating price floors but not ruling out levies. Traders had been closely watching the outcome of a US Commerce Department probe on whether imports of the metal and other critical minerals threatened national
security.  The weakness spread to base metals, sending copper toward $13,000 a ton. Spot gold -0.7%, Silver -5%, Copper futures -1.7%.

ENERGY:   

Oil fell for the first time in six days, tumbling after President Trump signaled he may hold off on attacking Iran for now. A series of developments early on Wednesday
had suggested strikes were imminent. Iran briefly closed its airspace following reports of a redeployment of US troops in the region as Trump threatened to respond to the killings. Brent crude dropped by more than 4%, falling below $64 per barrel, following
a roughly 11% surge over the previous week. Trump said he’d been assured that Iran would stop killing protesters, reducing the likelihood of an immediate US military response and of disruptions to Iranian production and key shipping lanes. Separately,
⁠Trump told Reuters that he believes it would be better for Venezuela to remain in OPEC
but was unsure if that would be a better situation for the US. The US intervention in Venezuela is pushing more crude toward America, driving regional mid-sized tanker rates to the highest in about two years. WTI -4.5%, Brent -4.3%, US Nat Gas +1.1%, RBOB
-3.3%. 

CURRENCIES: 

In currency markets, the dollar strengthens against most FX majors. The yen traded little changed against the dollar after a report that Bank of Japan officials are
paying increasing attention to its potential impact on inflation. While the officials don’t have a preset course for borrowing costs, having just raised the benchmark rate last month, the yen could prompt them to bring forward subsequent rate hikes. Sterling
fell after UK economic data showed the economy grew more strongly than ⁠expected in
November but failed to affect the policy rate outlook. UK GDP was better than expected, rising 0.3% in November. US$ Index +0.2%, GBPUSD -0.45%, EURUSD -0.3%, USDJPY +0.15%, AUDUSD is flat, NZDUSD -0.2%, USDCHF +0.3%, USDCAD +0.15%, USDSEK +0.2%, USDNOK +0.4%.

Spot Bitcoin -1%, Spot Ethereum -0.4%.

Colors within the report:
Green is always the 200 period (day, week).
Red is always 21,
Blue = 50,
Brown =
100 *Stars have added importance 

• Upgrades
• Amplitude (AMPL) Raised to Overweight at Morgan Stanley; PT $16
• Analog Devices (ADI) Raised to Overweight at Wells Fargo; PT $340
• Applied Materials (AMAT) Raised to Overweight at Barclays; PT $360
• Asana (ASAN) Raised to Buy at Citi; PT $16
• ASML (ASML NA) ADRs Raised to Outperform at KGI Securities; PT $1,415
• Broadcom (AVGO) Raised to Overweight at Wells Fargo; PT $430
• Calix (CALX) Raised to Overweight at JPMorgan; PT $90
• CI&T Inc (CINT) Raised to Buy at UBS; PT $7
• Dell Technologies (DELL) Raised to Overweight at Barclays; PT $148
• Descartes Systems (DSG CN) Raised to Overweight at Morgan Stanley
• Digital Realty (DLR) Raised to Buy at HSBC; PT $193
• DraftKings (DKNG) Raised to Overweight at Wells Fargo; PT $49
• Entegris (ENTG) Raised to Buy at UBS; PT $145
• F5 Inc. (FFIV) Raised to Overweight at JPMorgan; PT $345
• KLA Corp (KLAC) Raised to Overweight at Wells Fargo; PT $1,600
• Lam Research (LRCX) Raised to Overweight at Wells Fargo; PT $250
• Manhattan Associates (MANH) Raised to Buy at Citi; PT $208
• Millicom (TIGO) Raised to Buy at UBS; PT $70
• Monolithic Power (MPWR) Raised to Overweight at Wells Fargo
• Peyto Exploration (PEY CN) Raised to Outperform at CIBC; PT C$25
• Samsara (IOT) Raised to Outperform at BNP Paribas; PT $40
• SiTime (SITM) Raised to Equal-Weight at Barclays
• Southwest Gas (SWX) Raised to Buy at Citi; PT $99
• Downgrades
• Albertsons Cos (ACI) Cut to Underweight at Morgan Stanley; PT $14
• Birchcliff Energy (BIR CN) Cut to Neutral at CIBC; PT C$8.50
• Flutter (FLUT) Cut to Equal-Weight at Wells Fargo; PT $228
• GE Healthcare (GEHC) Cut to Sell at UBS; PT $77
• Leslie’s (LESL) Cut to Underweight at Morgan Stanley; PT $1.50
• Logan Energy (LGN CN) Cut to Neutral at CIBC; PT 95 Canadian cents
• MoonLake Immunotherapeutics (MLTX) Cut to Sell at Goldman; PT $10
• Nutanix (NTNX) Cut to Equal-Weight at Barclays; PT $53
• Rocket Lab (RKLB) Cut to Sector Weight at KeyBanc
• Silgan (SLGN) Cut to Sector Perform at RBC; PT $43
• Teck Resources (TECK/B CN) Cut to Market Perform at Raymond James
• Vtex (VTEX) Cut to Neutral at UBS; PT $4
• Initiations
• AdvanSix (ASIX) Rated New Hold at Truist Secs; PT $19
• AMD (AMD) Rated New Sector Perform at RBC; PT $230
• American Financial (AFG) Rated New Overweight at Wells Fargo; PT $165
• Applied Materials (AMAT) Rated New Outperform at RBC
• ARM Holdings (ARM) ADRs Rated New Outperform at RBC
• ASML (ASML NA) ADRs Rated New Outperform at RBC
• Astera Labs (ALAB) Rated New Outperform at RBC
• BankUnited (BKU) Rated New Outperform at Raymond James; PT $51
• Broadcom (AVGO) Rated New Sector Perform at RBC; PT $370
• Golub Capital (GBDC) Rated New Buy at Lucid Capital Markets; PT $15
• Intel (INTC) Reinstated Sector Perform at RBC; PT $50
• Kinsale Capital (KNSL) Rated New Overweight at Wells Fargo; PT $490
• KLA Corp (KLAC) Rated New Sector Perform at RBC; PT $1,550
• Lam Research (LRCX) Rated New Outperform at RBC
• Lattice Semi (LSCC) Rated New Outperform at RBC
• LuxExperience (LUXE) ADRs Rated New Buy at B Riley; PT $12
• Marvell Technology (MRVL) Rated New Outperform at RBC
• Micron (MU) Rated New Outperform at RBC
• Nebius Group (NBIS) Rated New Equal-Weight at Morgan Stanley; PT $126
• Nvidia (NVDA) Rated New Outperform at RBC
• Qualcomm (QCOM) Rated New Sector Perform at RBC; PT $180
• Quantum Computing (QUBT) Rated New Buy at Rosenblatt Securities Inc
• Rigetti Computing (RGTI) Rated New Buy at Rosenblatt Securities Inc
• RLI (RLI) Rated New Equal-Weight at Wells Fargo; PT $62
• Sandisk (SNDK) Rated New Sector Perform at RBC; PT $400
• Silicon Labs (SLAB) Rated New Sector Perform at RBC; PT $160
• Sintana Energy (SEI CN) Rated New Buy at Pareto Securities; PT C$1.10
• Skyworks (SWKS) Rated New Sector Perform at RBC; PT $65
• Tantalus Systems Holding (GRID CN) Rated New Buy at TD Cowen; PT C$6.75
• Toyo (TOYO) Rated New Buy at HC Wainwright; PT $18
• West Coast Community (WCCB) Rated New Buy at Janney Montgomery; PT $52

Data sources: Bloomberg, Reuters, CQG

David Wienke