Daily Game Plan

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

TODAY’S ECONOMIC DATA:  8:30ET PPI Final Demand; 9:45ET MNI Chicago PMI – Fed speaker slate includes Miran (11:10am),
Musalem (1:30pm), Miran (3pm) and Bowman (5pm).

PPI Final Demand MoM 0.5% vs. 0.2% est.

Highlights and News:  

• Trump Picks a Reinvented Warsh to Lead the Federal Reserve
• Gold and Silver Sink as Fed Pick Boosts Dollar
• Tentative deal to avert US govt shutdown set to miss funding deadline
• China signals more access for UK firms after Xi met Starmer
• US Urges China to Let ‘Substantially Undervalued’ Yuan Rise
• Venezuelan Lawmakers Approve Sweeping Overhaul of Oil Sector

Global stocks are mixed to lower as risk-off sentiment swept across broader markets, but President Trump’s threats against Iran are keeping the market on edge. President
Trump said he would nominate Kevin Warsh to be the next chairman of the Federal Reserve, choosing a former Fed official who has aligned himself with the president’s criticism of the central bank. The euro zone economy grew quicker than expected last quarter
as consumption and investments kicked into higher gear, offsetting low exports, Eurostat data showed. Spain remained the driver of growth, expanding a quicker-than-forecast 0.8%, but Germany, the euro zone’s largest economy, also seems to be emerging from
years of struggles to grow 0.3%, above economists’ estimates. Tokyo’s pace of inflation cooled more than expected, with consumer prices excluding fresh food advancing 2% from a year earlier in January, backing the Bank of Japan’s gradual approach to raising
interest rates. BofA strategists warn global stocks are overbought, and the proportion of MSCI indexes above key moving averages has breached
their sell-signal threshold.

EQUITIES: 

US equity futures pared some overnight losses after Trump nominated former Federal Reserve Governor Kevin Warsh to head the US central bank. Warsh is seen as a comparatively moderate
figure who is notably more cautious of deploying heavy monetary stimulus despite his preference for lower rates. Meanwhile, Apple forecast higher-than-expected revenue growth of up to 16% for the March quarter but warned that rising memory chip prices had
started to pressure profitability. AAPL shares were marginally lower in premarket trading.

Futures ahead of the bell: E-Mini S&P -0.5%, Nasdaq -0.6%, Russell 2000 -1.1%, DJI -0.5%

In pre-market trading, Apple (AAPL) slips 0.4% after the iPhone maker warned that rising component costs are threatening to squeeze margins. The company also posted
its largest first-quarter sales growth in over four years, driven by strength in its closely-watched iPhone segment. Sandisk (SNDK) rises 23% as the computer hardware and storage company’s second-quarter revenue beat expectations. Raymond James analyst upgraded
the stock to outperform from market perform. American Express (AXP) falls 2.3% after the payment company reported earnings per share for the fourth quarter that missed the average analyst estimate. Deckers Outdoor (DECK) rises 12% after the owner of the Ugg
and Hoka footwear brands raised its annual earnings and sales forecast, beating the average analyst estimate. Analysts note strength in the retailer’s direct-to-consumer channels in the US. SoFi Technologies (SOFI) rises 6% after the online lender reported
net interest income and adjusted net revenue above estimates. Precious metals miners tumble; Newmont (NEM) drops 6.7% and Pan American Silver (PAAS) sinks 9% as precious metals faced a sharp decline from their highs.

The iShares Expanded Tech-Software Sector ETF (IGV) has declined over 15% over the last 30 days, and over 23% from October’s high.

European gauges are broadly higher, supported by positive earnings news. The region’s miners are among the biggest laggards after the copper price retreated from record
highs, while banks and technology shares outperform. Alten shares jump as much as 19% after the technology consulting firm reported fourth-quarter revenue growth that analysts described as surprisingly strong. Electrolux shares jump as much as 22%, their biggest
intraday gain on record, after the Swedish home appliances firm reported strong fourth-quarter earnings. Adidas gains as much as 6.2% after the sportswear company reported preliminary fourth-quarter operating profit that beat consensus estimates. Signify slumps
as much as 15% after the lighting specialist issued a profit warning for 2026. Stoxx 600 +0.7%, DAX +0.8%, CAC +0.7%, FTSE 100 +0.4%. Banks +1.8%, Technology +1.3%, Travel +1.2%. Basic Resources -2.3%.

Shares in Asia were mostly lower after a tech selloff tied to rising costs of AI morphed into a commodity-related slide. The MSCI Asia Pacific index fell 1%, with TSMC,
Alibaba, and Tencent among the biggest drags. Gold and copper-related stocks in the region fell as markets prepare for Trump’s Fed Chair nominee, Kevin Warsh, who has a previous reputation as an inflation hawk. Chifeng Jilong Gold Mining in Hong Kong and Sumitomo
Metal Mining in Japan sank 14% and 8.7% respectively. Memory chip stocks, such as SK Hynix and Samsung Electronics helped the South Korean Kospi Index stay in the green. The Kospi flipped an early 1.9% rally to a loss before turning positive again. Chinese
property stocks fell, paring big recent gains. Morgan Stanley says the recent sentiment-driven outperformance is “likely unsustainable” given the fragile housing market and the sector’s high valuation. Indonesian equities rebounded after a two-day market rout
that led to the bourse’s chief stepping down. Hang Seng Tech -2.1%, Hang Seng Index -2.1%, Taiwan -1.5%, CSI 300 -1%, ASX 200 -0.6%, Singapore -0.5%, Sensex -0.3%, Nikkei 225 -0.1%. Kospi +0.05%, Topix +0.6%, Vietnam +0.8%, Indonesia +1.2%, Philippines +1.7%.

FIXED INCOME: 
 

Treasuries hold an early twist steepening move after President Trump confirmed on Truth Social his pick of Kevin Warsh for the next Federal Reserve chief. US long-end
yields remain cheaper by around 2bp on the day, while front-end yields are down 2bp with 2s10s and 5s30s spreads steeper by 2bp and 2.5bp on the day. US 10-year yields trade around 4.25%. Money markets added to bets on a rate cut in June, with two reductions
priced in for 2026.

METALS: 

Gold and silver suffered their biggest slide in years, with gold dropping as much as 8% to crash through $5,000 an ounce and silver slumping below $100. The sell-off
was triggered by the dollar rebounding after a report the Trump administration was preparing to nominate Kevin Warsh for Federal Reserve chair, which undercut sentiment among investors. Spot gold -6.9%, Silver -16%, Copper futures -3%. 

ENERGY:   

Oil retreated a bit after a three-day rally as Iran says it’s ready for talks if Donald Trump ends his threats against the Islamic Republic. President Trump indicated
overnight that he’s had discussions with Iran and expects them to continue, cooling off the week’s strong oil rally. Despite this, tensions in the region remain high, leading to Brent’s biggest monthly gain since 2022. Members of OPEC+ will gather online on
Sunday to review supply policy for March; expectations are for the group to stick with a pause.  Exxon Mobil Corp. and Chevron Corp. surpassed profit expectations with higher oil production as the Trump administration pressures major US drillers to assist
in the revival of the Venezuelan oil sector. WTI -0.3%, Brent -0.3%, US Nat Gas +1.3%, RBOB -0.3%.

CURRENCIES: 

In currency markets, the dollar trimmed its advance after Trump made his announcement to nominate Kevin Warsh as the next Fed Chair on Truth Social, with traders
debating how far Warsh would cut interest rates. The dollar’s advance reversed some of yesterday’s weakness, with the yen weakening past 154 to the dollar. Japan’s Finance Ministry confirmed no currency intervention occurred in the latest monthly period covering
most of January, removing intervention concerns that had supported the yen earlier this week. The Japanese yen also faced pressure from softer Tokyo CPI data, fiscal concerns, and political risks. The euro pulled back from recent highs as Fed-related headlines
overshadowed mixed European economic data. US$ Index +0.35%, GBPUSD -0.5%, EURUSD -0.5%, USDJPY +0.8%, AUDUSD -0.6%, NZDUSD -0.3%, USDCHF +0.6%, USDCAD +0.35%, USDSEK +0.3%, USDNOK +0.25%.

Spot Bitcoin -2%, Spot Ethereum -3%. The Securities and Exchange Commission and the Commodity Futures Trading Commission expect to sign a memorandum of understanding
to formalize their cooperation on regulating the crypto industry.

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
• Ameriprise (AMP) Raised to Neutral at Piper Sandler; PT $530
• Circle Internet (CRCL) Raised to Neutral at Compass Point; PT $60
• Deckers Outdoor (DECK) Raised to Outperform at KGI Securities; PT $129
• GE Vernova (GEV) Raised to Buy at Guggenheim; PT $910
• Globus Medical (GMED) Raised to Buy at Needham; PT $112
• Hexcel (HXL) Raised to Equal-Weight at Morgan Stanley; PT $90
• International Paper (IP) Raised to Equal-Weight at Wells Fargo
• Quest Diagnostics (DGX) Raised to Overweight at Barclays; PT $210
• Royalty Pharma (RPRX) Raised to Buy at UBS; PT $49
• Sandisk (SNDK) Raised to Outperform at Raymond James; PT $725
• Southwest Air (LUV) Raised to Outperform at BMO; PT $57.50
• Spotify (SPOT) Raised to Buy at Citi; PT $650
• Tal Education (TAL) ADRs Raised to Outperform at Macquarie; PT $18
• Valley National (VLY) Raised to Strong Buy at Raymond James; PT $15
• Downgrades
• Arthur J Gallagher (AJG) Cut to Neutral at Cantor; PT $282
• Codere Online Luxembourg (CDRO) Cut to Hold at Stifel; PT $8.50
• Dollar Tree (DLTR) Cut to Sell at CFRA
• Fractyl Health (GUTS) Cut to Equal-Weight at Morgan Stanley; PT $2
• Gran Tierra (GTE) Cut to Hold at Canaccord; PT $5.92
• Kenvue (KVUE) Cut to Hold at Jefferies; PT $18
• PagSeguro (PAGS) Cut to Neutral at Banco BTG Pactual; PT $13
• Quince Therapeutics Inc (QNCX) Cut to Market Perform at Citizens
• Cut to Hold at Brookline Capital
• SAP (SAP GR) ADRs Cut to Market Perform at Citizens
• Initiations
• Arista Networks (ANET) Rated New Buy at William O’Neil
• ASML (ASML NA) ADRs Reinstated Add at CTBC Securities; PT $1,620
• Carlisle (CSL) Rated New Market Perform at William Blair
• Definium Therapeutics In (DFTX) Rated New Buy at Jefferies; PT $30
• Engene Holdings (ENGN) Rated New Buy at Jefferies; PT $28
• Figure Technology (FIGR) Rated New Buy at Texas Capital; PT $82
• IRSA (IRSA AR) ADRs Reinstated Outperform at Itau BBA; PT $23
• Medtronic (MDT) Rated New Outperform at CICC; PT $121
• Pulse Biosciences (PLSE) Rated New Outperform at Mizuho Securities
• RenovoRx (RNXT) Rated New Buy at Jones; PT $8
• RxSight (RXST) Rated New Market Perform at William Blair

Data sources: Bloomberg, Reuters, CQG

David Wienke