Daily Game Plan

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

TODAY’S ECONOMIC DATA:  8:30ET Chicago Fed Nat Activity Index; 10:00ET Factory Orders, Durable Goods Orders, Cap
Goods Orders; 10:00ET Dallas Fed Manf. Activity

Highlights and News:  

• US Tells Partners to Honor Tariff Deals as Trump Regroups
• EU set to freeze approval of US trade deal
• India Postpones US Trip to Finalize Trade Pact on Tariff Ruling
• Hedge Funds Sell the Most Equities Globally Since April
• Trump Weighs Big Iran Strike if Talks Fail: NYT
• US/Iran nuclear talks to resume on Thursday
• TRUMP: I CAN USE LICENSES TO CHARGE FOREIGN COUNTRIES
• NJ Transit services were halted and most flights in the Northeast are suspended
• Mexican authorities killed cartel leader “El Mencho,” in a raid in Jalisco that sparked clashes nationwide

Global stocks slid on fresh uncertainty in US trade policy that rekindled “sell America” positioning, after President Trump enacted a replacement 15% tariff following
the Supreme Court’s ruling against his prior sweeping import taxes. The European Union is poised to freeze the ratification process of its trade deal with the US and is seeking more details from President Trump’s administration on its new tariff program. Senior
US officials said Trump’s tariff defeat at the Supreme Court won’t unravel deals negotiated with US partners. US Trade Representative Jamieson Greer said those deals remain in place and the administration will stand by them, expecting partners to do the same.
Hedge funds net sold global equities at the fastest pace since the tariff meltdown of early April 2025, according to the Goldman Sachs Prime Desk, with European stocks seeing the fastest selling in five months. Sector-wise, seven of 11 global industry groups
were net sold, led by financials and TMT stocks. Meanwhile, energy, health care and staples were the most net bought. The United States and Iran are scheduled to hold their next round of talks on Thursday in Geneva, according to Omani mediators, as efforts
continue to find a diplomatic resolution to the ongoing standoff over Iran’s nuclear program.

EQUITIES: 

US equity futures recover some of the early overnight losses after President Trump’s tariff defeat at the Supreme Court increases uncertainty over trade policies. Nasdaq contracts dropped
as much as 1% before halving those losses. Trade deals made with partners including China, the European Union, Japan and South Korea — remain in place, US Trade Representative Jamieson Greer said Sunday on CBS’s Face the Nation. He sought to separate those
arrangements from the planned 15% global tariff Trump announced Saturday. Trump vowed to use other powers to maintain his signature tariff policies. JPMorgan strategists view potential de-risking on the back of adverse geopolitical headlines as likely short-lived,
creating a dip-buying opportunity. Citi says that US equities are set up for a constructive year in terms of earnings projections. In corporate news, Gilead Sciences agreed to buy US cancer-focused biotech Arcellx Inc. for as much as $7.8 billion as it seeks
to boost its drug pipeline. Key events this week include Trump’s State of the Union Address tomorrow, Nvidia earnings on Wednesday and PPI data on Friday.

Futures ahead of the data/bell: E-Mini S&P -0.4%, Nasdaq -0.55%, Russell 2000 -0.6%, DJI -0.5%

In pre-market trading, Arcellx Inc. (ACLX) soars 78% after Gilead Sciences Inc. agreed to buy the biotech in a deal with an equity value of up
to $7.8 billion. Domino’s Pizza (DPZ) climbs 4% after the company reported a larger-than-expected rise in comparable sales.  International Paper (IP) falls 6% and Smurfit (SW) drops 6% as analysts note that a surprise price drop in domestic containerboard
is negative for packaging companies. MoonLake Immunotherapeutics (MLTX) rises 4% after the drug developer gave topline results from a mid-stage trial of its experimental therapy for patients with an inflammatory disease that mainly affects the spine. Vanda
Pharmaceuticals (VNDA) climbs 40% after the FDA approved the firm’s oral medication for treating manic or mixed episodes in bipolar I disorder and schizophrenia in adults. Veris Residential (VRE) rises 12% after agreeing to be acquired by an investor consortium
led by Affinius Capital in partnership with Vista Hill Partners, in an all-cash transaction for $19 per share. VF Corp. (VFC) declines 3% as JPMorgan cuts its rating on the apparel and shoe company to underweight and trims profit estimates for upcoming years.

European gauges are mixed after paring early declines. Technology and health care shares lead declines, while banks and miners outperformer. Novo
Nordisk shares fall over 14% after the firm said its Cagrisema product fell short of Lilly’s Zepbound in a trial.  Enel shares rise ~6% after the Italian energy company forecast higher-than-expected dividends and EPS growth and announced a €1 billion share
buyback. JD Sports shares climb as much as 6.5% after the sportswear retailer said it plans to return £200 million to shareholders through buybacks. Johnson Matthey shares fell as much as 17% after Honeywell cut the price it’s paying for the UK company’s Catalyst
Technologies business. Belimo shares fall as much as 12% after analysts expressed concerns over the heating and cooling equipment maker’s guidance for 2026 and the delayed impact of tariff decisions.  Stoxx 600 -0.25%, DAX -0.5%, CAC ~flat, FTSE 100 +0.1%. 
Banks +1.4%, Basic Resources +1.3%, Utilities +0.9%. Healthcare -1.8%, Defense -1.3%, Technology -1.2%.

Shares in Asia rose to near record highs, driven by gains in tech, while investors weighed the impact of President Trump’s latest slate of tariffs on the region. The
MSCI Asia Pacific Index rose 0.6%, with Tencent and Alibaba among the biggest boosts to the gauge. Hang Seng Index jumped more than 2% as Chinese tech stocks rallied in Hong Kong. China and India now stand to gain from lower tariff rates on exports to the
US. The weighted average tariff rate for Asia will fall to 17% from 20%, with average levies on goods from China declining to 24% from 32%, according to Morgan Stanley economists. Hong Kong’s property stocks rose as JPMorgan and Goldman Sachs see the sector
set for further recovery on a resilient domestic stock market and a release of pent-up demand from mainland Chinese buyers. China and Japan were closed for holidays. Hang Seng Tech +3.3%, Hang Seng Index +2.5%, Vietnam +2%, Indonesia +1.5%, Kospi +0.6%, Sensex
+0.6%, Taiwan +0.5%, Singapore +0.5%, Philippines +0.4%. ASX 200 -0.6%.

FIXED INCOME: 
 

Treasuries are muted as investors weigh Trump’s plan to replace tariffs last week deemed unlawful with a 15% across-the-board levy on US imports. US 10-year yield
near 4.07% is less than 1bp lower on the day; curve spreads are mixed with 2s10s -2 bps; 5s30s is flat. IG dollar issuance slate empty so far, however dealers forecast about $50 billion of high-grade issuance this week from a broad range of sectors with quarterly
earnings reporting season nearly over. Treasury auctions this week include 2-, 5- and 7-year notes for a combined $183 billion, starting Tuesday. 

METALS: 

Gold jumps about 1% to $5,155 and silver rallies almost 3% as heightened uncertainty over US trade policy unsettled markets. The 15% tariff rolled out by the White
House is meant to replace those the court invalidated, though it’s only permitted to last up to 150 days. The Supreme Court ruling has also cast doubt over deals the US has negotiated with major trading partners. The European Union is poised to freeze the
ratification process of an agreement with Washington until there’s more clarity, Indian officials will postpone a trip to the US, while a member of Japan’s ruling party called the situation “a real mess.” Spot gold +0.9%, Silver +2.6%, Copper futures -0.5%. 

ENERGY:   

Crude oil reversed early losses amid anticipation of renewed US-Iran negotiations later this week, against the ongoing backdrop of heightened American military presence
in the Middle East. Brent trades below $72 a barrel, after jumping almost 6% last week as Trump said he was considering a limited military strike on Iran. The next round of talks in Geneva is slated for Thursday. In a Sunday interview with CBS, Iran’s Foreign
Minister Abbas Araghchi expressed optimism about reaching a diplomatic solution to the nuclear dispute, describing it as a “win-win” possibility within reach, but reiterated that US military escalation cannot pressure or influence Iran. Trump is leaning towards
an initial US strike on Iran in coming days to push it to scrap its nuclear program, the NYT said. If that fails he’ll consider a bigger attack aimed at driving the country’s leaders from power. US natural gas prices rose as powerful winter storms swept the
northeastern region. WTI +0.2%, Brent +0.1%, US Nat Gas +2.3%, RBOB +0.1%.

CURRENCIES: 

In currency markets, the dollar recouped early losses as traders considered the impact of President Trump’s latest plan for global tariffs on US imports. Traders
are closely watching how other world leaders are responding to the latest tariff developments. Trump has imposed new global tariffs, citing a balance-of-payments crisis, which many economists do not see as a current issue for the US. That means his latest
import taxes seem likely to lead to yet another legal challenge and more uncertainty for trading partners. The Swiss franc could surge as much as 17% to the dollar amid growing confidence in the currency’s haven status, according to Morgan Stanley strategists.
US$ Index ~flat, GBPUSD +0.1%, EURUSD ~flat, USDJPY -0.15%, AUDUSD -0.2%, NZDUSD -0.15%, USDCHF +0.05%, USDCAD +0.05%, USDSEK +0.2%, USDNOK +0.3%.

Spot Bitcoin -1.8%, Spot Ethereum -1.1%.  Major hedge funds that fueled the rapid growth in American spot Bitcoin ETFs are exiting quickly, with their combined holdings
in these funds declining 28% between Q3 and Q4 2025, according to CF Benchmarks data.

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
• Acadia Pharma (ACAD) Raised to Outperform at Mizuho Securities; PT $35
• Alphabet (GOOGL) Raised to Overweight at Wells Fargo; PT $387
• BlackRock (BLK) Raised to Buy at UBS; PT $1,280
• CBRE (CBRE) Raised to Buy at UBS; PT $185
• Element Fleet (EFN CN) Raised to Buy at Jefferies; PT C$41
• Henry Schein (HSIC) Raised to Outperform at Baird; PT $100
• Icon (ICLR) Raised to Buy at Jefferies; PT $135
• Macerich (MAC) Raised to Overweight at KeyBanc; PT $25
• Nvidia (NVDA) Raised to Buy at Aletheia Capital; PT $250
• Downgrades
• AES Corp (AES) Cut to Hold at HSBC; PT $16
• Athabasca Oil (ATH CN) Cut to Sector Perform at RBC; PT C$9
• Deere (DE) Cut to Underperform at Jefferies; PT $550
• Docusign (DOCU) Cut to Hold at Jefferies; PT $45
• Freshworks (FRSH) Cut to Hold at Jefferies; PT $8
• General Mills (GIS) Cut to Neutral at BofA; PT $48
• Harmony Biosciences (HRMY) Cut to Hold at Deutsche Bank; PT $31
• Cut to Hold at Truist Secs
• Imperial Oil (IMO CN) Cut to Underperform at RBC; PT C$116
• Infosys (INFO IN) ADRs Cut to Hold at Jefferies; PT $14.31
• Mister Car Wash (MCW) Cut to Neutral at JPMorgan; PT $7
• Monday.com (MNDY) Cut to Hold at Jefferies; PT $80
• NBT Bancorp (NBTB) Cut to Neutral at Janney Montgomery; PT $47
• Nutrien (NTR CN) Cut to Neutral at BNP Paribas; PT C$103.85
• Superior Plus (SPB CN) Cut to Market Perform at Raymond James; PT C$8.50
• Cut to Sector Perform at Scotiabank; PT C$6.50
• Cut to Hold at Desjardins; PT C$7
• Vertical Aerospace (EVTL) Cut to Underperform at Raymond James
• VF Corp (VFC) Cut to Underweight at JPMorgan; PT $18
• Workday (WDAY) Cut to Hold at Jefferies; PT $150
• Initiations
• Bob’s Discount Furniture (BOBS) Rated New Buy at DA Davidson; PT $26
• Context Therapeutics (CNTX) Rated New Outperform at LifeSci Capital
• Ethos Technologies (LIFE) Rated New Buy at Deutsche Bank; PT $23
• Rated New Outperform at William Blair
• Rated New Buy at Citi; PT $15
• Rated New Market Outperform at Citizens
• Rated New Outperform at Baird; PT $18
• Rated New Overweight at JPMorgan; PT $13
• Rated New Overweight at Barclays; PT $20
• Rated New Buy at Goldman; PT $33
• H2O America (HTO) Rated New Overweight at Barclays; PT $61
• MiMedx (MDXG) Rated New Market Outperform at Citizens; PT $10
• Nova Minerals ADRs Rated New Sell at Spruce Point Capital
• PicS (PICS) Rated New Outperform at Mizuho Securities; PT $30
• Rated New Buy at Citi; PT $28
• Rated New Outperform at RBC; PT $20
• Tango Therapeutics (TNGX) Rated New Outperform at Mizuho Securities
• York Space Systems (YSS) Rated New Outperform at Raymond James; PT $55
• Rated New Hold at Truist Secs; PT $30
• Rated New Buy at Canaccord; PT $36
• Rated New Overweight at Wells Fargo; PT $35
• Rated New Outperform at Baird; PT $40
• Rated New Buy at Jefferies; PT $37
• Rated New Overweight at JPMorgan; PT $39
• Rated New Neutral at Goldman; PT $29
• Yorkville Acquisition (MCGA) Rated New Buy at Jefferies; PT $37
• Yuanbao (YB) ADRs Rated New Neutral at Citi; PT $21.80

Data sources: Bloomberg, Reuters, CQG

David Wienke