Daily Game Plan

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

TODAY’S ECONOMIC DATA:  11:30ET $58 billion 3-year new issue; 12:30ET Fed’s Bostic speaks; 12:45ET Fed’s Barkin
speaks; 1:00ET $39 billion 10-year notes reopening; 6:00ET Fed’s Williams speaks; G-7 finance ministers meet in Washington to discuss rare earths and other issues

Highlights and News:  

• Fed Chair Powell was served grand jury subpoenas
• Trump told NBC he had no knowledge of the DOJ’s investigation
• Shares in US credit card issuers slide after Trump calls for 10% rate cap
• Federal prosecutors launch new probe into NY AG Letitia James
• European countries led by the UK and Germany discussing plans for a military presence in Greenland
• Iran Says It Quelled Nationwide Protests After Hundreds Reported Killed in the Crackdown
  
• US weighs tough response to Iran
• Iran said it is keeping communications open with the US; “ready for negotiations based on mutual respect”
• US attacked multiple Islamic State targets in Syria on Saturday
  

Global stocks are slightly lower, with ‘sell America’ sentiment revived by the Trump administration’s latest attacks on the Fed. Federal Reserve Chair Jerome Powell
announced that the US Department of Justice served the central bank with grand jury subpoenas, threatening a potential criminal indictment tied to his testimony before the Senate Banking Committee in June regarding renovations to the Fed’s headquarters. Powell
responded to the administration’s threat of a criminal indictment by calling it a “pretext” aimed at pressuring the central bank to cut interest rates. Trump said he is also weighing a range of strong responses including military options to a violent crackdown
on Iranian protests. Iran’s foreign minister announced that the regime’s forces have secured absolute control after weeks of protests and chaos, claiming that Israel and America are behind efforts to incite the unrest. Protests in Iran intensified with an
estimated 544 deaths and over 10,000 arrests. Trump said that Tehran’s leadership reached out to seek talks. Elsewhere, a group of European countries led by the UK and Germany are discussing plans for a military presence in Greenland. The second full week
of the year will include US inflation data, trade figures from China and a slew of US earnings beginning with large banks.

EQUITIES: 

US equity futures are lower after Jerome Powell said the Fed was served subpoenas on Friday. Financial stocks fell in premarket trading after President Trump called for a 10%, one-year
cap on credit card interest rates, threatening a key revenue stream for banks and other lenders. Some analysts said imposing a limit on rates would require legislation and could exceed presidential authority. In corporate news, Walmart said it is partnering
with Alphabet to offer AI-enhanced shopping on Google’s Gemini platform. This week’s key calendar highlights include Tuesday’s release of CPI data and the official start of earnings season. S&P 500 companies are set to report better 4Q earnings than the consensus
forecasts, though profit-margin expansion will likely be modest, according to Goldman Sachs strategists.

Futures ahead of the bell: E-Mini S&P -0.5%, Nasdaq -0.75%, Russell 2000 -0.3%, DJI -0.6%.

In pre-market trading, Credit card companies and banks slide as President Trump said credit-card lenders would be “in violation of the law” if the firms don’t cap interest
rates at 10% for one year. Movers include American Express (AXP -4%), Capital One (COF -8%) and JPMorgan (JPM -2.5%). Precious metals and mining shares rally after the US threatened the Federal Reserve with a criminal indictment, undermining the dollar and
sending gold and silver prices to record highs. Akamai Technologies Inc. (AKAM) rises 4.5% after Morgan Stanley upgraded the infrastructure software company by two notches, to overweight. Albemarle Corp. (ALB) gains 3.9% after analysts raised their price targets
on the lithium producer as metal prices rally. Day One Biopharmaceuticals (DAWN) rises 20% after the drugmaker reported preliminary sales for its Ojemda cancer drug in the fourth quarter that topped expectations. Shake Shack Inc. (SHAK) falls 5% after the
burger chain reported preliminary revenue for the fourth quarter that missed. Sun Country Airlines Holdings Inc. (SNCY) jumps 15% after Allegiant Travel agreed to buy the company in a $1.5 billion cash-and-stock transaction.

Homebuilders ETF +5.2% on Friday.

European gauges are muted near all-time highs as concerns over the independence of the Federal Reserve weighed on investor confidence while geopolitical worries also
continue to linger. Mining shares gained as gold and silver hit records while travel and auto stocks decline. The Stoxx 600 is now the most overbought in 10 years as a sector rotation plays out. The 14-day Relative Strength Index has climbed above 80, a rare
occurrence over the past two decades. Eight sector indexes are flashing overbought levels: technology, industrials, basic resources, health care, utilities, retail, real estate and financial services. Among individual stocks, Abivax SA shares surged 26% as
speculation mounted over a possible takeover of the French biotech. Heineken NV dropped 6% as its CEO is set to step down months after the company warned on profit over falling beer sales. Barclays Plc fell as much as 3.3% after President Trump said that credit-card
lenders would be “in violation of the law” if they don’t heed his call to cap interest rates at 10% for one year. Stoxx 600 +0.05%, DAX +0.5%, CAC ~flat, FTSE 100 +0.1%. Basic Resources +0.9%, Defense +0.8%. Travel -0.9%, Autos -0.7%, Food & Bev -0.5%.

Shares in Asia rose as a rally in the region’s tech shares and a weaker US dollar boosted sentiment, helping offset broader concerns over rising geopolitical tensions.
The MSCI Asia Pacific Index rose 0.6%, snapping a three-day losing streak. Alibaba, Tencent and TSMC provided the biggest boosts to the gauge. Most markets were in the green, with Hong Kong-listed Chinese stocks and indexes in Taiwan and South Korea among
key gainers. South Korea’s tech-heavy market extended its new-year rally, with the Kospi rising for a seventh session to a fresh record. Shares of China’s biggest food-delivery firms climbed as the nation’s top antitrust body launched a probe into competition
practices in the sector. Chinese retailers rose after top leaders called for closer policy coordination to boost consumption. Japan was shut for a holiday. Hang Seng Tech +3.1%, Hang Seng Index +1.4%, Philippines +1.1%, Taiwan +0.9%, Kospi +0.8%, CSI 300 +0.6%,
Vietnam +0.5%, ASX 200 +0.5%, Sensex +0.4%. Indonesia -0.6%, Thailand -0.9%.

FIXED INCOME: 
 

Treasuries hold losses in early US trading led by long-end tenors ahead of an accelerated and compressed auction calendar that includes 3- and 10-year note sales
Monday and a 30-year bond reopening Tuesday. Risk to Fed independence is a factor after Chair Powell’s response to Sunday’s revelation of a federal criminal investigation.  US yields are 1bp-4bp cheaper on the day with 2s10s and 5s30s spreads are both wider
by about 2bp. 10-year near 4.2%. Today’s Treasury auctions are $58 billion 3-year new issue at 11:30am and $39 billion 10-year reopening at 1pm

METALS: 

Gold jumped over 2% to a fresh all-time peak over $4,600 per ounce, with silver also reaching a historic high as money markets priced in a slightly higher chance
of short-term US interest rate cuts. Investors rushed into safe-haven assets amid a criminal investigation launched by the Trump administration against Fed Chair Jerome Powell and deadly protests in Iran over the weekend. Trump said he is also weighing a range
of strong responses including military options to a violent crackdown on Iranian protests. Spot gold +2.1%, Silver +6.6%, Copper futures +2.7%.

ENERGY:   

Oil prices saw little reaction to the Iran situation. RBC analysts said oil supply from Iran could be disrupted if workers join the protests and walk off the job.
Both benchmarks rose more than 3% last week in their biggest gains since October, as Iran’s clerical establishment stepped up its crackdown on the demonstrations. Iran’s Foreign Minister said security forces have “full control” of the country after two weeks
of violent unrest, and said Iran is “ready for negotiations based on mutual respect, national interests”. Vitol and Trafigura are in discussions with large Indian and Chinese refiners over potential sales of Venezuelan crude after the trading giants obtained
a preliminary green light from the US government to market the oil. Trump signaled he’s leaning toward excluding Exxon Mobil from his push for US oil majors to rebuild Venezuela’s petroleum industry, saying he was displeased with the company’s response to
his initiative. Meanwhile, Ukraine overnight targeted three drilling platforms in the Caspian Sea owned by Russian oil major Lukoil, with the facilities sustaining direct hits. WTI -0.4%, Brent -0.3%, US Nat Gas +1.2%, RBOB +0.6%.

CURRENCIES: 

In currency markets, the dollar fell by the most in three weeks as tensions between the Fed and the Trump administration escalated. Haven currencies climb after the
US Justice Department serves the Federal Reserve with grand jury subpoenas and global geopolitical concerns continue to rattle risk sentiment. Escalating tensions are fueling anxiety over the central bank’s autonomy, potentially upending the bullish options
sentiment seen at the start of the year. Sterling and the euro rose as jitters around Fed independence saw the dollar drop against all its Group-of-10 peers. Traders held bets on BOE interest-rate cuts, pricing 46 basis points of reductions by year-end. A survey showed
further signs of labor market weakness, with UK employers cutting back their hiring again in December. Onshore yuan hovers near its strongest level since 2023. The yen edged higher as speculation that Japanese Prime Minister Sanae Takaichi will call for a
snap election continues to rise; the Yomiuri newspaper reported that Takaichi may call for a vote on Feb. 8 or Feb. 15. US$ Index -0.35%, GBPUSD +0.55%, EURUSD +0.5%, USDJPY -0.1%, AUDUSD +0.4%, NZDUSD +0.65%, USDCHF -0.6%, USDCAD -0.3%, USDSEK -0.6%, USDNOK
-0.5%.

Spot Bitcoin -0.1%, Spot Ethereum -0.3%. 

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
• Advanced Energy (AEIS) Raised to Positive at Susquehanna; PT $300
• Airbnb (ABNB) Raised to Buy at B Riley; PT $170
• Akamai (AKAM) Raised to Overweight at Morgan Stanley; PT $115
• Albemarle (ALB) Raised to Sector Outperform at Scotiabank; PT $200
• Amphenol (APH) Raised to Overweight at Barclays
• Appian (APPN) Raised to Overweight at Morgan Stanley
• Applied Materials (AMAT) Raised to Positive at Susquehanna; PT $400
• BeOne Medicines (6160 HK) ADRs Raised to Outperform at Bernstein; PT $414
• Carlsberg (CARLB DC) ADRs Raised to Outperform at BNP Paribas; PT $31.30
• Comcast (CMCSA) Raised to Buy at BofA; PT $37
• Conoco (COP) Raised to Overweight at Wells Fargo; PT $132
• Crinetics Pharma (CRNX) Raised to Buy at Goldman; PT $67
• Datadog (DDOG) Raised to Overweight at Morgan Stanley; PT $180
• Descartes Systems (DSG CN) Raised to Overweight at Barclays; PT C$145.88
• Frontline PLC (FRO) Raised to Buy at Clarksons; PT $28.33
• Liberty Formula One (FWONA) Raised to Outperform at Bernstein; PT $111
• Lithium Argentina AG (LAR CN) Raised to Sector Outperform at Scotiabank
• Oportun (OPRT) Raised to Neutral at JPMorgan; PT $5.50
• Pebblebrook (PEB) Raised to Outperform at Baird; PT $15
• Pool Corp (POOL) Raised to Outperform at Baird; PT $320
• Rocket Cos. (RKT) Raised to Neutral at JPMorgan; PT $24
• Trade Desk (TTD) Raised to Neutral at MoffettNathanson LLC; PT $39
• Trex (TREX) Raised to Buy at DA Davidson; PT $50
• Vertex Pharmaceuticals (VRTX) Raised to Outperform at Bernstein
• Vista Energy (VISTAA MM) ADRs Raised to Buy at UBS; PT $65
• Downgrades
• Allstate (ALL) Cut to Hold at TD Cowen; PT $231
• American Electric Power (AEP) Cut to Neutral at BofA
• American Woodmark (AMWD) Cut to Neutral at Baird; PT $60
• Amkor Technology (AMKR) Cut to Neutral at UBS; PT $55
• Arrow Financial (AROW) Cut to Market Perform at Hovde Group
• Axalta (AXTA) Cut to Neutral at UBS; PT $35
• Brunswick (BC) Cut to Hold at Texas Capital; PT $90
• CrowdStrike (CRWD) Cut to Sector Weight at KeyBanc
• Datadog (DDOG) Cut to Sell at Goldman
• DoubleVerify (DV) Cut to Equal-Weight at Barclays; PT $12
• Gitlab (GTLB) Cut to Equal-Weight at Morgan Stanley; PT $42
• Cut to Underweight at Barclays; PT $34
• Heineken (HEIA NA) ADRs Cut to Neutral at BNP Paribas; PT $43
• HomeTrust Banc (HTB) Cut to Market Perform at Hovde Group
• Nutanix (NTNX) Cut to Equal-Weight at Morgan Stanley
• OneMain (OMF) Cut to Underweight at JPMorgan; PT $65
• Perimeter Solutions (PRM) Cut to Neutral at UBS; PT $31
• Pernod Ricard (RI FP) ADRs Cut to Underperform at BNP Paribas; PT $15.70
• Range Resources (RRC) Cut to Equal-Weight at Wells Fargo; PT $43
• Seadrill (SDRL) Cut to Sell at Citi; PT $32
• SLM (SLM) Cut to Underweight at JPMorgan; PT $25
• Snowflake (SNOW) Cut to Equal-Weight at Barclays; PT $250
• Sunstone Hotel (SHO) Cut to Neutral at Baird; PT $10
• Triumph Financial Inc (TFIN) Cut to Neutral at B Riley; PT $70
• Initiations
• Abaxx Technologies Inc (ABXX CN) Rated New Outperform at BMO; PT C$64
• Aeromexico (AEROMEX* MM) ADRs Rated New Buy at Banco BTG Pactual; PT $30
• Allot Ltd (ALLT) Rated New Overweight at Cantor; PT $15
• Andersen Group (ANDG) Rated New Outperform at William Blair
• Rated New Buy at Deutsche Bank; PT $30
• Rated New Buy at Truist Secs; PT $32
• Rated New Equal-Weight at Wells Fargo; PT $25
• Rated New Outperform at Baird; PT $40
• Rated New Buy at UBS; PT $28
• Rated New Equal-Weight at Morgan Stanley; PT $22
• Cameco (CCO CN) Rated New Buy at Mirae Asset Securities
• CBIZ (CBZ) Rated New Hold at Deutsche Bank; PT $60
• Claritev Corp (CTEV) Rated New Buy at Guggenheim; PT $43
• Fulcrum Therapeutics (FULC) Rated New Overweight at JPMorgan; PT $20
• G2 Goldfields Inc (GTWO CN) Rated New Speculative Buy at Canaccord
• Hims & Hers Health (HIMS) Rated New Inline at Evercore ISI; PT $33
• Innate Pharma (IPH FP) ADRs Reinstated Neutral at Goldman; PT $2.77
• Integra (ITR CN) Rated New Speculative Buy at Canaccord; PT C$9.25
• Inventiva SACA (IVA FP) ADRs Rated New Outperform at Leerink; PT $12
• Medline (MDLN) Rated New Outperform at Bernstein; PT $49
• Rated New Buy at BTIG; PT $50
• Rated New Buy at TD Cowen; PT $46
• Rated New Outperform at William Blair
• Rated New Outperform at Mizuho Securities; PT $48
• Rated New Equal-Weight at Wells Fargo; PT $42
• Rated New Overweight at Barclays; PT $50
• Rated New Buy at Truist Secs; PT $52
• Rated New Neutral at Rothschild & Co Redburn; PT $42
• Rated New Outperform at Baird; PT $48
• Rated New Overweight at JPMorgan; PT $50
• Rated New Buy at UBS; PT $48
• Rated New Buy at Stifel; PT $46
• Rated New Buy at Jefferies; PT $50
• Rated New Outperform at BMO; PT $45
• Rated New Buy at Goldman; PT $49
• Rated New Overweight at Piper Sandler; PT $50
• Rated New Outperform at RBC; PT $47
• Rated New Outperform at Leerink; PT $48
• Rated New Overweight at Morgan Stanley; PT $48
• Netflix (NFLX) Rated New Buy at HSBC; PT $107
• Neumora Therapeutics (NMRA) Rated New Outperform at Leerink; PT $8

Data sources: Bloomberg, Reuters, CQG

David Wienke