Daily Game Plan

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

TODAY’S ECONOMIC DATA:  8:30ET PPI, Jobless Claims; 1:00ET 30-Year Bond Auction

US JAN. PPI EX FOOD, ENERGY & TRADE RISES 0.3% M/M; EST. +0.2%

Highlights and News:  

• ~75,000 – or 3% of US federal workers accept Trump administration buyout program
• Hamas Says It Will Free Hostages on Schedule, Averting War
• TRUMP SAYS ‘TODAY IS THE BIG ONE: RECIPROCAL TARIFFS’
  
• Sidelined European Leaders Seek Ukraine Talks Role After Trump-Putin Call
• DOGE government-efficiency staff will be heading to NASA to review payments
  

Global stocks rose on growing optimism about a peace deal between Ukraine and Russia. European leaders are upset by Trump’s phone calls with Russian President Putin
and Ukraine’s Zelenskiy on Wednesday, feeling they were sidelined and cut out after the US president said he’d agreed to negotiate an end to the war. Meanwhile, Trump posted on social media today that reciprocal tariffs are coming today. Euro zone industrial
production shrank by more than expected in December, as Germany shrank by 2.9% and Italy by 3.1%, suggesting the sector’s two-year recession is far from over. Hamas announced it would release hostages as planned on Saturday, reversing an earlier threat to
indefinitely postpone the action, which had raised concerns about the stability of the ceasefire in Gaza.

EQUITIES:  

US equity futures are little changed after Chinese technology stocks saw a dramatic intraday turnaround to finish lower. Futures wavered in the wake of Trump’s social media post regarding
tariffs and ahead of PPI data. Investors await another batch of data this morning after Wednesday’s hot inflation numbers forced traders to push out bets on the next Federal Reserve interest-rate cut to December. Futures ahead of the bell/data: E-Mini S&P
-0.1%, Nasdaq +0.05%, Russell 2000 +0.3%, DJI ~flat.

Futures ahead of the bell/data: E-Mini S&P -0.1%, Nasdaq +0.05%, Russell 2000 +0.3%, DJI ~flat.

In pre-market trading, Robinhood Markets shares jump 16% after the retail brokerage reported fourth-quarter net revenue that topped expectations, with cryptocurrency
revenue soaring. 10X Genomics shares sink 8% after the maker of biological-research equipment forecast revenue for 2025. Albemarle shares rise 3.1% in premarket trading after the lithium producer reported adjusted Ebitda for the fourth quarter that was better
than Wall Street’s expectations.  Apple (AAPL -0.4%) is leading losses for the Magnificent Seven stocks. TSLA outperformed up over 2%. Aspen Aerogels shares plunge as much as 34% after the thermal insulation products maker’s first-quarter guidance fell short
of expectations. Deere shares fall as much as 8.7% as the tractor maker maintained its outlook as a slumping agriculture sector continues to hit farm machinery tractor sales. Dutch Bros shares soar 24% after the drive-thru coffee chain’s total revenue forecast
for 2025 exceeded analyst estimates. Fastly shares fall as much as 21% after the infrastructure software company’s outlook for the year disappointed. HubSpot shares rise as much as 5.7% after the software company reported fourth-quarter results that beat.
MGM Resorts shares jump 9.2% after the gaming and entertainment company reported fourth-quarter adjusted earnings per share that came ahead of estimates. Trade Desk shares plummet 27% after the advertising technology company gave a first-quarter forecast that
is weaker than expected.

European gauges are mostly higher while energy prices drop on optimism about a possible end to the Ukraine war. UK stocks underperform as earnings provide a drag. Shares
of Unilever, British American Tobacco and Barclays are down after their latest corporate updates. Traders are trimming their Bank of England interest-rate cut bets after the UK registered unexpected growth at the end of 2024.  The Stoxx 600 is on course for
another record close, lifted by positive earnings updates from the likes of Nestle AG and Siemens AG. Auto and food & beverage sectors leading gains while energy shares decline.  Stoxx 600 +0.7%, DAX +1.5%, CAC +1.3%, FTSE 100 -0.5%.

Shares in Asia were mixed to higher with the MSCI Asia Pacific Index rising as much as 1.4% before paring to end +0.6%. Chinese tech shares in Hong Kong erased earlier
gains in the session to fall almost 1%, as traders took profit after recent advances.  Japanese and South Korean stocks were among the best performers in the region. KKR is said to be considering investing in Nissan after the automaker’s talks to combine with
Honda failed. Traders in Asia will be monitoring India Prime Minister Modi’s meeting with Trump at the White House later today. Indian stocks have been on a decline ahead of the meeting. Kospi +1.4%, Nikkei 225 +1.3%, Philippines +1.1%, Taiwan +0.5%, Vietnam
+0.3%, Singapore +0.2%, ASX 200 +0.05%. Sensex -0.5%, Hang Seng Index -0.2%, CSI 300 -0.4%, Indonesia -0.5%. 

FIXED INCOME: 
 

Treasuries edged higher after their biggest selloff since December. Bond markets are now concentrating on upcoming producer-price inflation data and a 30-year US
government bond auction today to determine if the sharp drop on Wednesday was warranted.  US yields are 1bp-3bp richer across maturities with the 2s10s curve flatter by ~2bps. 10-year yield is down2.5bps around 4.6%.

METALS: 

Gold resumed its ascent toward a record as the US dollar and Treasury yields fell, with traders assessing America’s push to end the war in Ukraine and President Donald
Trump’s disruptive moves on trade. Bullion’s latest move higher followed a small gain Wednesday even as data showed a higher-than-expected rise in US inflation that blunted the case for rate cuts. Gold and silver are flooding into US warehouses at a rate not
seen since the pandemic. Years of emerging-market central-bank hoarding have likely created a shortage of physical metal in the West. Spot gold +0.3%, Silver ~flat, Copper +0.7%.

ENERGY:   

Oil fell further as hopes for a Russia and Ukraine peace deal bolstered the possibility of an easing of Russian oil sanctions that have disrupted supply flows. The
IEA again slashed expectations for a global oil surplus this year on strong demand growth in Asia and sanctions on OPEC+ nations. It now sees an overhang of 450,000 barrels a day, marking a cut of roughly 50% in just two months. European natural gas prices
drop ~5%. WTI -1.4%, Brent -1.3%, US Nat Gas +3.5%, RBOB -0.8%. 

CURRENCIES: 

In currency markets, the euro initially rose against the dollar on optimism about US-Russia talks, but later gave up its gains after President Trump signaled plans
to announce reciprocal tariffs on trading partners. Sterling edged higher, helped by data showing an unexpected modest 0.1% pick-up in British GDP at the end of last year. The dollar pared losses after President Trump said reciprocal tariffs are coming today.
The Swiss franc outperforms all G-10 currencies. Switzerland’s inflation rate hit the lowest level in almost four years after the country saw widespread power-price cuts at the start of the year. US$ Index -0.05%, GBPUSD +0.25%, EURUSD +0.1%, USDJPY -0.4%,
AUDUSD -0.2%, NZDUSD -0.1%, USDCHF -0.7%, USDCAD -0.2%, USDMXN +0.5%, USDSEK -0.3%.

Spot Bitcoin -2%, Spot Ethereum -1%.

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
• AT&T (T) Raised to Outperform at BNPP Exane; PT $28.50
• Casey’s (CASY) Raised to Buy at Gordon Haskett
• Cisco (CSCO) Raised to Buy at Rosenblatt Securities Inc; PT $80
• Coca-Cola (KO) Raised to Buy at DZ Bank; PT $75
• CVS (CVS) Raised to Outperform at Leerink; PT $75
• Raised to Overweight at Cantor; PT $71
• Cytokinetics (CYTK) Raised to Overweight at Morgan Stanley; PT $67
• DuPont de Nemours (DD) Raised to Equal-Weight at Barclays; PT $89
• Ecopetrol (ECOPETL CB) ADRs Raised to Neutral at JPMorgan; PT $9.50
• Genmab (GMAB DC) ADRs Raised to Outperform at Leerink; PT $27
• Gilead (GILD) Raised to Buy at DZ Bank; PT $108
• HubSpot (HUBS) Raised to Overweight at KeyBanc; PT $920
• Jazz Pharma (JAZZ) Raised to Overweight at Wells Fargo; PT $170
• Manhattan Associates (MANH) Raised to Outperform at William Blair
• Vishay Precision (VPG) Raised to Buy at B Riley; PT $28.50
• Vista Energy (VISTAA MM) ADRs Raised to Buy at Citi; PT $66
• Wesdome Gold Mines (WDO CN) Raised to Buy at Desjardins; PT C$17.50
• Downgrades
• 10X Genomics (TXG) Cut to Market Perform at Leerink; PT $12
• Aspen Aerogels (ASPN) Cut to Neutral at Seaport Global Securities
• Centerra Gold (CG CN) Cut to Hold at Desjardins; PT C$11
• Galapagos (GLPG NA) ADRs Cut to Neutral at Van Lanschot Kempen; PT $28
• General Dynamics (GD) Cut to Neutral at BTIG
• Kite Realty (KRG) Cut to Neutral at Piper Sandler; PT $25
• Kraft Heinz (KHC) Cut to Neutral at Citi; PT $28
• Cut to Underperform at BofA; PT $30
• Macy’s (M) Cut to Accumulate at Gordon Haskett
• Olin (OLN) Cut to Neutral at Piper Sandler; PT $33
• Target (TGT) Cut to Hold at Gordon Haskett
• Trade Desk (TTD) Cut to Inline at Evercore ISI
• Initiations
• Fortis (FTS CN) Rated New Hold at Jefferies; PT C$67
• GE Vernova (GEV) Rated New Outperform at Baird; PT $448
• GH Research (GHRS) Rated New Overweight at Cantor
• Kering (KER FP) ADRs Rated New Hold at Berenberg; PT $22.20
• LeMaitre Vascular (LMAT) Rated New Equal-Weight at Wells Fargo; PT $95
• Merus NV (MRUS) Rated New Overweight at Piper Sandler; PT $84
• Sunrise Realty Trust (SUNS) Rated New Buy at B Riley; PT $15
• Viking Therapeutics (VKTX) Rated New Sector Outperform at Scotiabank
• Vinci (DG FP) ADRs Rated New Buy at Berenberg; PT $32

Data sources: Bloomberg, Reuters, CQG

David Wienke