U.S. stock futures climbed on Thursday with a pending GDP report as Wall Street processed recent quarterly earnings reports from several major tech companies. This followed a down session after the Federal Reserve maintained current interest rates. More earnings from the “Magnificent Seven” companies are expected, with Apple reporting on Thursday and Amazon scheduled for next week. Key economic data releases include the fourth-quarter GDP reading and weekly jobless claims on Thursday, followed by Friday’s personal consumption expenditures price index report for December. Investors are closely watching these reports for insights into the health of the economy and potential future Fed policy moves.

European stock markets advanced on Thursday as investors considered a range of important earnings reports and economic data releases, while also anticipating the European Central Bank’s (ECB) upcoming monetary policy announcement. The ECB is widely expected to initiate its first meeting of 2025 with a 25-basis-point interest rate reduction. This anticipated cut would lower the key overnight deposit facility rate to 2.75%, representing the fifth such decrease since the central bank started loosening monetary policy in June of the previous year.

Asian markets were mostly up on Thursday, with the Nikkei 225 and the S&P/ASX 200 both gaining ground. The Nikkei 225 rose 0.25%, while the S&P/ASX 200 climbed 0.55%. However, not all stocks were winners. Shares in SoftBank Group fell 1.06% after the company announced it was in talks to invest up to $25 billion in OpenAI. On the economic front, Bank of Japan Deputy Governor Ryozo Himino said that the central bank would continue to raise interest rates if the economy and prices move in line with its forecasts.

Economic Calendar

Earnings Calendar

Notable reports for Thursday before the bell include FLWS, AOS, ALGM, MO, ABG, AVY, BHLB, BX, BFH, BIP, BC, CNQ, CAH, CRS, CAT, CVE, CHKP, CMCSA, CFR, COV, DT, FRME, FCFS, FLG, GIL, IP, KEX, LHX, MBUU, MAN, MMC, MA, MBLY, MUR, NTCT, NOC, OSK, PH, PHM, DGX, RCI, ROP, RES, SNY, SCSC, SNDR, SHW, SIRI, LUV, STM, CI, TMO, TSCO, TT, UPS, & VLO.

After the bell reports include AAPL, ATGE, ABCB, APPF, AJG, TEAM, BKR, BZH, CNI, CLS, COUR, DECK, EMN, FHI, GEN, HIG, HTH, INTC, KLAC, LPLA, OLN, PPG, RMD, SKYW, STEL, X, VIAV, & WY.

News & Technicals’

DeepSeek’s claim that its R1 model surpasses OpenAI’s o1 while costing significantly less has raised questions about the massive expenditure on AI by major tech companies. While this claim has prompted some to reconsider the cost of AI development, many experts remain skeptical. Regardless of the ultimate outcome of the scrutiny surrounding DeepSeek, the emergence of such claims is generally viewed by AI scientists as a positive development for the advancement of the industry.

Meta CEO Mark Zuckerberg downplayed the potential impact of DeepSeek’s new AI model, stating it’s too early to assess its effects on Meta and the tech industry. He also refuted the idea that DeepSeek’s reported efficiency breakthrough would lead to reduced AI spending at Meta. Zuckerberg emphasized his belief that significant investment in capital expenditures and infrastructure will continue to be a key strategic advantage for the company going forward.

The euro zone economy stagnated in the fourth quarter of 2024, with zero growth, according to flash estimates from Eurostat. This missed economists’ expectations of 0.1% growth and followed a stronger-than-expected 0.4% expansion in the third quarter. Disappointing results from the bloc’s largest economies, Germany and France, contributed to the flat growth. Germany’s GDP decreased by 0.2%, while France’s economy also contracted slightly. Additionally, Italy’s economy showed no growth for the quarter.

A midair collision between a military helicopter and an American Airlines regional jet on Wednesday night has tragically ended a period of exceptional commercial air travel safety in the United States, marking the worst such disaster on U.S. soil in over 15 years. American Eagle Flight 5342, carrying 60 passengers and four crew members, was nearing Ronald Reagan Washington National Airport at an altitude of approximately 300 feet when it collided with a U.S. Army Black Hawk helicopter carrying three people.

Expecting another uncertain day starting the pending GDP report that is expected to show a slowing in the economy and the report for the AAPL after the bell should also create considerable price volatility. Indexes remain extended so plan your trading carefully.

Trade Wisely,

Doug