Happy Friday,
 
Nvidia continued to dominate the headlines yesterday after CEO Jensen Huang resigned. The stock fell >5% taking the total losses from its early October highs to >30%, though it did close well off the lows. The broader AI complex traded in a similar fashion selling off early but recouping some of those losses. Nvidia’s largest competitors AMD and Broadcom were both up ~5% while Google and Amazon also traded higher given their burgeoning chip businesses. The S&P 500 opened down a little more than 0.5%, turned positive mid-morning but faded into the close to end the session down 0.35%. However, the equal weight (-0.9%) and small/midcap indices (down >1%) underperformed. Oil prices bounced 3% after President Trump said, “We don’t need a deal with Iran” which added to the weakness in Treasury markets. Yields were up ~10bps across the curve and have now moved up between 30-40bps since last week’s lows. The USD continued to hit new highs which weighed on precious metals and cryptocurrencies.
 
After the close there was a strong round of tech earnings. However, futures turned lower during Asian market hours only to rebound again as European markets opened. Futures pushed to fresh highs after this morning’s PPI data though that last leg has largely reversed already.  Headline PPI came in a touch below expectations (0.3% vs. 0.4%) while core was inline (0.3%). Treasury yields also briefly moved lower post data but are back around unchanged again. Outside of the evolving Nvidia saga and disappointment around the Giants implosion and what could have been it’s a somewhat quiet morning. S&P futures are up ~0.4%.
 

 
There is some modest steepening of the yield curve while the USD continues to move modestly higher. Fed officials have been on the media circuit supporting additional tightening. NY Fed Williams called for further tightening but warned of being too aggressive and hurting employment, a more dovish take than Waller earlier this week.
 

• US 2yr -2bps to 4.88%, 5yr -0bps to 4.98%, 10yr +1bps to 5.14%, 30yr +2bps to 5.48%
• USD index: +$0.03 to $103.13

 
Japan’s Nikkei rose 0.5% to end the week up 6.5%. Softbank fell 5% but ended the week flat thanks to a big 14% gain Tuesday. Samsung is reportedly in talks to buy cooling systems provider Modine (+35% pre-market) .The yen continued to weaken against the dollar and traded to ¥160.25 at its weakest, with investors eyeing signs of another intervention. JGB yields rose 15-20bp across the curve this week, about half of the US moves.  Chinese stocks were lower with the Hang Seng lagging today and on the week. Tencent and Alibaba fell 3% locally and growth stocks overall were under pressure. Numerous tech names in Shenzhen down 10% or more. Given all the news recently it’s not surprising that there’s a renewed push by US lawmakers to advance legislation that would limit chip exports to China. The US Commerce Department is also coming under heavy scrutiny. Major European indices are flat to fractionally lower but are on track for weekly gains of 2-4%. Stocks in the European STOXX 600 are on track for their best earnings growth performance (+25% y.y, ex-energy +10%) since 2024. EU leaders are holding their first dedicated summit on artificial intelligence today, focused on how the region can catch up with the US and China. The UK is reportedly close to a breakthrough on an EU “reset”. US envoy Jared Kushner said an end to the Ukraine war cannot happen without Europe at the table.
 

 
January brent crude is trading higher as it looks for a third straight day of gains, following the sharp decline since the beginning of the month. Iran reportedly attacked a US radar facility in Bahrain. The IEA took its 2026 oil demand forecast slightly lower and kept 2027 demand growth of 2m unchanged. Supply however was bumped up from a 5.8mbpd decline to a -4.8m decline, and expects global markets to return to a supply surplus in Q4. US natural gas is lower, though is up ~10% for the week. Metals are trading around unchanged with gold looking at a weekly loss of ~5% as rates and the Dollar moved higher. Ag is mostly higher with mixed gains for the week while crypto continues to stumble. Bitcoin lost its 200d and has fallen below $70k for the first since late August.
 

 
Earnings:
After-Market: AMAT, CBRS, CSCO, FLO, UAMY, YSS
Pre-Market: XXI
 
Economic Data:
US:

• PPI m.m / y.y: 0.3% / 6.5% vs 0.4% / 6.6% cons, prior 1.4% / 6.3%
  • Core: 0.3% / 5.0% vs 0.3% / 5.0% cons, prior 0.8% / 5.0%
• Fed Speakers: Bowman (10:50am), Daly (12pm), Jefferson (7pm)
• 10:30am EIA natural gas inventories
• 1:00pm Rig count

Global:

• Korea Export prices: 36.7% vs prior 41.3%
• Germany wholesale prices m.m: 0.4% vs 0.4% cons, prior 1.9%
• India trade balance: $-39.88B vs $-32.0B cons, prior $-30.21B
• China new loans: CNY-100B vs CNY20B cons, prior CNY1,080B
• EU trade balance: €-10.3B vs €-4.5B cons, prior €-16.6B