The S&P 500 Index ($SPX) (SPY) today is up +0.37%, the Dow Jones Industrials Index ($DOWI) (DIA) is up +0.03%, and the Nasdaq 100 Index ($IUXX) (QQQ) is up +0.51%. March E-mini S&P futures (ESH25) are up +0.29%, and March E-mini Nasdaq futures (NQH25) are up +0.39%.
Stock indexes are moving higher today, led by strength in chip stocks. Also, some positive corporate news is boosting the overall market. Super Micro Computer is up more than +16% after it filed its 10-K for the period ending June 30 to meet a deadline for submitting outstanding financial reports to regain compliance and stay listed on the Nasdaq exchange. Axon Enterprise is up more than +13% after reporting better-than-expected Q4 net sales and forecasting full-year revenue above consensus. In addition, Intuit is up more than +12% after reporting stronger-than-expected Q2 net revenue.
Stocks found support today, and bond yields rose after House Republicans passed a budget blueprint on Tuesday night calling for deep cuts to programs such as Medicaid, paving the way for $4.5 trillion in tax cuts. The House passage is the first step in a process that allows Republicans to bypass Senate Democrats on legislation related to taxes and spending, but it does not guarantee an extension of the expiring 2017 Trump tax cuts. The Senate plans to make changes to the House blueprint before passing it, which could raise new objections among House Republicans. The House passed the budget plan 217 to 215, and the blueprint would raise the US debt limit by $4 trillion, avoiding a potential default this summer. Congress has until December 31 to extend expiring individual and business tax cuts enacted in 2017.
Copper prices (HGH25) jumped more than +3% today to a 1-1/2 week high after President Trump Tuesday evening signed an executive order directing the Commerce Department to examine possible tariffs on US copper imports.
US weekly MBA mortgage applications fell -1.2% in the week ended February 21, with the purchase mortgage sub-index up +0.2% and the refinancing mortgage sub-index down -3.6%. The average 30-year fixed rate mortgage fell -5 bp to 6.88% from 6.93% in the prior week.
Stock investors are looking ahead to Nvidia's earnings report after today's close. This remainder of this week's US economic calendar is busy. Thursday's US Q4 GDP report is expected to show an increase of +2.3% (q/q annualized), with a +4.1% increase in personal consumption. Friday's Jan PCE price index report, the Fed's preferred inflation measure, is expected to ease slightly to +2.5% y/y from December's +2.6%, and the core index is expected to ease to +2.6% y/y from December's +2.8%. The expected Jan PCE reports of +2.5% nominal and +2.6% core would leave those measures at or above their 3-3/4 year lows posted in 2024 of +2.1% and +2.6%, respectively, and well above the Fed's +2% inflation target.
The markets are discounting the chances at 2% for a -25 bp rate cut at the next FOMC meeting on March 18-19.
Overseas stock markets today are mixed. The Euro Stoxx 50 is up +1.50%. China's Shanghai Composite Index closed up +1.02%. Japan's Nikkei Stock 225 fell to a 4-month low and closed down -0.25%.
Interest Rates
March 10-year T-notes (ZNH25) today are up by +2 ticks. The 10-year T-note yield is down -0.8 bp to 4.289%. March T-notes are slightly higher, just below Tuesday's 2-1/2 month high, and the 10-year T-note yields fell to a 2-1/2 month low of 4.279%. T-notes are climbing today on positive carryover from Tuesday when US Feb consumer confidence tumbled to an 8-month low. T-notes also have some positive carryover from today's rally in European government bonds.
Gains in T-notes are limited after House Republicans passed a budget blueprint late Tuesday evening calling for tax cuts that will boost the deficit and could lead to an increase of Treasury debt to help pay for the cuts. Supply pressures are also weighing on T-notes as the Treasury will sell $28 billion of floating-rate 2-year T-notes and $44 billion of 7-year T-notes this afternoon.
European bond yields are falling today. The 10-year German bund yield dropped to a 1-1/2 week low of 2.421% and is down -2.3 bp to 2.435%. The 10-year UK gilt yield fell to a 1-1/2 week low of 4.470% and is down -2.7 bp to 4.482%.
The German Mar GfK consumer confidence index unexpectedly fell -2.1 to an 11-month low of -24.7, weaker than expectations of an increase to -21.6.
Swaps are discounting the chances at 100% for a -25 bp rate cut by the ECB at the March 6 policy meeting.
US Stock Movers
Chip stocks are climbing today to recover some of Tuesday's sharp losses. Micron Technology (MU) is up more than +3% and Nvidia (NVDA) is up more than +2% to lead gainers in the Dow Jones Industrials ahead of its earnings report after today's close. Also, Marvell Technology (MRVL), Broadcom (AVGO), and Intel (INTC) are up more than +2%.
Super Micro Computer (SMCI) is up more than +20% to lead gainers in the S&P 500 after it filed its 10-K for the period ending June 30 to meet a deadline for submitting outstanding financial reports to regain compliance and stay listed on the Nasdaq exchange.
Axon Enterprise (AXON) is up more than +16% to lead gainers in the Nasdaq 100 after reporting Q4 net sales of $575.1 million, better than the consensus of $566.6 million, and forecasting full-year revenue of $2.55 billion-$2.65 billion, the midpoint above the consensus of $2.56 billion.
ZoomInfo Technologies (ZI) is up more than +16% after reporting Q4 adjusted EPS of 26 cents, better than the consensus of 23 cents, and forecast full-year adjusted EPS of 95 cents-97 cents, stronger than the consensus of 92 cents.
Intuit (INTU) is up more than +12% after reporting Q2 net revenue of $3.96 billion, stronger than the consensus of $3.83 billion.
Workday Inc (WDAY) is up more than +8% after reporting Q4 revenue of $2.21 billion, better than the consensus of $2.18 billion.
General Motors (GM) is up more than +6% after it said it plans to raise its quarterly dividend and boost its share buyback program to $6 billion.
Freeport-McMoRan (FCX) is up more than +3% after copper prices jumped more than +3% to a 1-1/2 week high when President Trump signed an executive order that may lead to tariffs on US copper imports.
Grocery Outlet (GO) is down more than -30% after forecasting full-year adjusted EPS of 70 cents-75 cents, well below the consensus of 95 cents.
Health insurance stocks are under pressure today after the Wall Street Journal said Republican Senator Grassley is pushing for greater oversight of Medicare Advantage plans. As a result, Molina Healthcare (MOH) is down more than -5% to lead losers in the S&P 500. Also, Centene (CNC), HCA Healthcare (HCA), and Universal Health Services (UHS) are down more than -4%. In addition, Elevance Health (ELV) and Cigna Group (CI) are down more than -1%.
AppLovin (APP) is down more than -17% to lead losers in the Nasdaq 100 after Culper Research and Fuzzy Panda published short reports against the company.
Maplebear (CART) is down more than -9% after forecasting Q1 adjusted Ebitda of $220 million-$230 million, weaker than the consensus of $237.1 million.
Zeta Global Holdings (ZETA) is down more than -7% after forecasting Q1 revenue of $253 million-$255 million, below the consensus of $256.1 million.
Keysight Technologies (KEYS) is down more than -5% after reporting Q1 orders of $1.26 billion, below the consensus of $1.30 billion.
Earnings Reports (2/26/2025)
Verisk Analytics Inc (VRSK), NRG Energy Inc (NRG), Lowe's Cos Inc (LOW), TJX Cos Inc/The (TJX), Invitation Homes Inc (INVH), Agilent Technologies Inc (A), APA Corp (APA), Universal Health Services Inc (UHS), Synopsys Inc (SNPS), eBay Inc (EBAY), NVIDIA Corp (NVDA), FirstEnergy Corp (FE), Salesforce Inc (CRM), Paramount Global (PARA).
