WTI: Traders Remain Heavy Buy Ahead of Weekend Output Decision

Indices: Tech Weighs, Futures Slip Ahead of PPI

- U.S. equity index futures are in slight retreat following a weaker session dominated by losses within the semiconductor sphere, with the tech-heavy Nasdaq 100 (-1.2% to 25,034) leading the declines and smaller losses for the S&P 500 (-0.5% to 6,908), while the Dow 30 (0% to 49,499) avoided a red finish; Treasury yields edged lower across the curve with the 10-year yield not far off breaking beneath 4% as investors await the January PPI release, and market pricing (CME’s FedWatch) continues to show (via majority) it’ll be rate cuts in July and October

Stocks: Semiconductor Pullback, and Media Drama Finally Sees a Winner

- Shares of Nvidia (NASDAQ:NVDA) (-5.5%) tumbled despite beating on both earnings and revenue and taking the semiconductor sphere with it as AMD (-3.4%), Intel (-3%) and ASML (-4.1%) all suffered losses

- Battle to acquire Warner Bros Discovery (NASDAQ:WBD) (-1.7% in AH) looks as though it’ll be ending as Netflix (NASDAQ:NFLX) (+8.5% in extended trading) won’t acquire it following Paramount Skydance’s (+10% by the close and +6.2% in AH) superior offer

- Shares of Block (+23.6%) skyrocketed in extended trading following its results and after announcing plans to cut more than 4,000 employees

- IonQ (+21.7%) jumped on upbeat revenue guidance; Morgan Stanley raises its price target

- Shares of Meta (-0.7%) fall back a bit in extended trading; The Information says its internal chip design has hit roadblocks, and that it signed a deal to rent Google’s TPUs to develop new AI models

- Red session for PayPal (-3.7%) as it says it’s not in talks to sell (to Stripe or anyone)

- Meme stock movers: Beyond Meat (+2.9%), GoPro (+3.3%), Krispy Kreme (+27.8%), Opendoor (+8.6%), BlackBerry (+2.6%)

- Earnings:

o   Dell Technologies (NYSE:DELL): beats on earnings and revenue; shares jump 11.6% in extended trading

o   Zscaler (NASDAQ:ZS): deferred revenue and billings miss expectations; shares plunge 9.5% in extended trading

o   Synopsys (NASDAQ:SNPS): full-year revenue guidance disappoints; shares fall 5.2%

o   CoreWeave (NASDAQ:CRWV): slight beat on revenue but revenue guidance for the current quarter below forecast; shares plummet 8.8%

o   Rolls-Royce: beats and profit outlook raised, £2.5bn of share buybacks to be completed this year; share close 5.2% higher

o   Baidu: misses on revenue; shares fall 5.7% by the close

Commodities:

- Gold volatility drops as it holds near $5.2K though failing to stick above the level again with an eye on the geopolitical scene and a slightly stronger dollar on the FX front; silver gets back to $90 taking the gold/silver ratio below 58; WGC says caution is warranted due to stretched valuations

- Oil prices (WTI) hover around $65 following yesterday’s uptick in intraday volatility as progress was cited in Geneva with talks next Monday but where reports regarding military options and action persist out of the U.S; traders will also note Sunday’s OPEC+ meeting to see whether unconfirmed reports of a potential increase in April’s output prove true

FX/Central Banks/Crypto:

- Bitcoin falls back to $68K with Ether still holding above $2K

- US Dollar Index edges higher in the 97 handle, undoing Wednesday’s losses following firmer labor data (see Data below) and fading expectations of a near-term Fed rate cut

- Federal Reserve’s Miran that the central bank should cut a percentage point this year in four quarter-point moves and sees banks as over-regulated, while Goolsbee says that rates can come down but wants to avoid front-loading before inflation eases

- European Central Bank’s Lagarde that they expect inflation to stabilize at the 2% target in the medium term, reiterating their data-dependent and meeting-by-meeting approach, and monitoring FX rather than targeting it

Capital.com Client Sentiment:

- Indices: Majority long sentiment jumps back up after the pullback and most visible in the Nasdaq (heavy buy 71% from 57% yesterday) with the S&P not too far off extreme long (75% from 69%), with more moderate increases for both Dow (72% from 67%) and Russell (71% from 70%) as the close for the two weren’t far off from the open; elsewhere pullback in the Nikkei shifts sentiment back to majority buy (to a heavy 65% from a slight sell 51%) while not far off shifting in the DAX (52% from 60%)

- Commodities: Trim their majority buy bias a few notches and fall out of extreme buy in gold (75% from 78% yesterday) though take it up a notch in silver (81% from 80%); small changes in energy with WTI still heavy buy (71% from 72%) and natural gas extreme long (88% from 86%)

- FX: Mostly small changes in sentiment for the key FX pairs

Data: Labor Data Better than Expected

- U.S. initial jobless claims come in at 212K, below the 217K forecast and in turn healthier than anticipated, with continuing claims also below expectations, falling from 1.864m to 1.833m; Kansas Fed manufacturing activity in February improves from -2 to 10

- Tokyo CPI in February 1.6% (from 1.5%) for headline, but both core and “core-core” fall to 1.8% from a previous 2%; retail sales in January up 1.8% y/y no longer contracting; preliminary industrial production for the same month disappoints up only 2.2% (vs 5.3% forecast)

Today:

- U.S. PPI (5:30 pm Dubai time), Chicago PMI (6:45 pm), weekly rig count data out of Baker Hughes (10 pm)

- In Europe, German preliminary CPI, import pricing (11 am), and labor data (12:55 pm)

Saturday:

- Earnings from Berkshire Hathaway

Sunday:

- OPEC+ meeting to decide April’s output