The three major stock index futures all decline; US January non-farm payrolls and CPI data to be released this week

Pre-Market Market Trends

1. On February 9th (Monday) pre-market, the U.S. stock three major index futures all declined. As of press time, Dow futures fell 0.06%, S&P 500 futures dropped 0.17%, and Nasdaq futures declined 0.33%.

2. As of press time, Germany’s DAX index rose 0.32%, the UK FTSE 100 index fell 0.13%, France’s CAC 40 index increased 0.03%, and Europe’s Stoxx 50 index gained 0.21%.

3. As of press time, WTI crude oil rose 0.44% to $63.83 per barrel. Brent crude oil increased 0.41% to $68.33 per barrel.

Market News

Non-farm payrolls + CPI data coming this week. Looking ahead, the market enters a key data window this week. On Tuesday, the U.S. Department of Commerce will release December retail sales data; the January non-farm employment report, originally scheduled for last week but delayed due to a government shutdown, will be released on Wednesday. Economists expect an increase of 70,000 non-farm jobs last month, with the unemployment rate remaining at 4.4%. This release coincides with signs of instability in the U.S. labor market. Additionally, the January non-farm report will include annual employment revisions beyond the usual monthly data. Market expectations are that revisions will show significantly lower employment growth for the year ending March 2025 than initially reported. On Friday, key inflation data will be released. The U.S. Bureau of Labor Statistics will publish the Consumer Price Index (CPI), with market expectations of a 0.3% month-over-month increase and a 2.5% year-over-year rise. On the corporate earnings front, notable companies such as Coca-Cola, McDonald’s, Cisco, and ON Semiconductor will announce their latest results this week.

Morgan Stanley supports tech stocks: AI investment cycle fluctuations do not change strong fundamentals, and the rebound still has momentum. Morgan Stanley strategists say that supported by the AI boom, the outlook for strong sales remains, and U.S. tech stocks have room for further gains. Led by Michael Wilson, the team states that revenue growth expectations for large tech companies have reached “decades-high levels,” and valuations have declined after recent market volatility. Meanwhile, the sharp decline in software stocks has created attractive buying opportunities for stocks like Microsoft and Advanced Micro Devices. Wilson wrote in a report: “Periods like last week are not uncommon in major investment cycles. Nevertheless, the fundamentals of the AI-enabled industry remain strong, and we believe the value of the AI adopter market is still undervalued.” Wilson’s view may reassure investors beginning to question the huge returns from AI investments.

Algorithmic selling wave subsiding? Goldman Sachs: If the S&P 500 falls below 6,707 points, it could trigger $80 billion in systemic sell-offs. According to Goldman Sachs’ trading desk analysis, after last Friday’s rebound that nearly recovered the midweek losses, the market may face further selling pressure from trend-following algorithm funds this week. The S&P 500 has broken below the short-term trigger point for systematic CTA selling. Goldman Sachs expects these trend-based strategies to continue net selling stocks over the next week regardless of market direction. The firm estimates that if the market declines again, it could trigger about $33 billion in selling pressure this week. Data shows that if market pressure persists and the S&P 500 drops below 6,707 points, an additional systemic sell-off of up to $80 billion could occur within a month. Specifically, if the market remains flat, CTA funds are expected to sell about $15.4 billion worth of U.S. stocks this week; even if the market rises, these trend-following strategies are still projected to sell about $8.7 billion.

Bank of America report: Trump’s approval ratings and the dollar’s trend are rarely in sync; market support is hard to sustain before his approval rate rebounds. Bank of America strategist Michael Hartnett noted in a recent report that the current trend of the dollar and the pressure on U.S. financial markets show a significant synchronization with President Trump’s approval ratings. Since Trump took office, the dollar index has fallen about 10%, and his approval ratings have also declined. The downward pressure and volatility in risk assets on Wall Street are unlikely to find effective support or relief until Trump’s approval rate shows a substantial rebound. This view directly links geopolitical polling data to market risk appetite, reflecting investors’ heavy reliance on U.S. policy implementation and future economic certainty.

Wosh’s “AI rate cut” theory faces fierce academic criticism: Trump’s loose policy plans may fall flat? Previously, Wosh claimed that AI would significantly boost productivity in the short term, enough to support U.S. rate cuts and avoid inflation rebound. However, an immediate survey of economists conducted by the Chicago Booth School of Business’s Center for Financial Markets found that most respondents see no evidence that AI will produce such effects within the next two years. Out of 45 respondents, nearly 60% believe AI’s impact on inflation and neutral interest rates will be minimal in the short term, each decreasing by at most 0.2 percentage points. Several economists say AI is unlikely to be a clear driver of inflation decline in the near term, nor does it pose a major inflation risk. About one-third of respondents hold more aggressive views, believing that AI-driven economic acceleration could slightly raise the neutral rate, which would complicate rate cut decisions rather than justify them.

Federal Reserve balance sheet changes imminent? Wosh and the Treasury’s “new agreement” could shake the $30 trillion U.S. debt market. Wosh has publicly supported drafting a new version of the 1951 agreement to reshape the relationship between the Fed and the Treasury. The original agreement strictly limited the Fed’s involvement in the bond market, but during the global financial crisis and COVID-19 pandemic, with trillions of dollars in securities purchases, the situation has changed dramatically. Before Wosh’s potential official appointment, he and Treasury Secretary Janet Yellen have not disclosed specific details of any new agreement. However, Wosh mentioned in an interview last year that a new agreement could “clearly and prudently define” the Fed’s balance sheet size and have the Treasury specify its debt issuance plans. Such reforms might ultimately be minor bureaucratic adjustments with little short-term impact on the $30 trillion U.S. debt market. But if it involves a broader reshuffle of the Fed’s holdings exceeding $6 trillion, it could lead to increased market volatility and, depending on circumstances, deepen concerns over the Fed’s independence.

Stock News

Claude’s bloodbath in the software industry and targeting human accounting! Goldman Sachs (GS.US) partners with Anthropic to automate accounting compliance. Goldman Sachs’ tech executives revealed that the bank is collaborating with AI startup Anthropic to develop AI agents, gradually automating multiple internal roles. Goldman’s CIO Marco Argenti said that over the past six months, Anthropic engineers have joined Goldman, and both sides are jointly developing autonomous AI agents focused on two core areas: transaction reconciliation and customer due diligence and account opening processes. Argenti stated that AI models based on Anthropic’s Claude are in early development, and these agents will significantly reduce processing times for these core tasks. He indicated that the AI agents are nearing deployment but did not specify a launch date.

Global copper shortage worsens! BHP (BHP.US) ramps up Argentina copper project investment, planning to double to $800 million this year. A BHP executive revealed that the company’s Vicuña Corp. plans to double its investment this year in a major copper project located on the Argentina-Chile border in the Andes at over 4,200 meters elevation. Vicuña’s communications director Caterina Dzugala said that this joint venture between Australia’s BHP and Canada’s Lundin Mining may invest around $800 million in the Filo del Sol and Josemaría mines this year. These projects are expected to become some of the most influential copper developments globally. Since the Alumbrera copper mine closed in 2018, Argentina has had no copper production. With global governments and automakers warning of a looming copper supply shortage as a key material for electrification, Argentina is seeking to re-enter the global copper market.

NatWest (NWG.US) spends £2.7 billion to acquire Evelyn! Targeting high-net-worth clients and wealth management. NatWest agreed to acquire wealth management firm Evelyn Partners, signaling its aim to expand coverage of high-net-worth clients domestically. In a Monday statement, the Edinburgh-based bank announced it will pay £2.7 billion (including debt) to acquire Evelyn, marking the largest private equity-backed wealth management exit in UK history. The acquisition is expected to accelerate CEO Paul Sweeney’s efforts to streamline NatWest’s operations and expand in priority areas, especially wealth management and high-net-worth clients. However, Jefferies analysts noted that the deal will weigh on NatWest’s earnings per share and tangible book value, and reduce short-term share repurchase capacity. As of press time, NatWest was down nearly 6% in pre-market trading.

Sohu (SOHU.US) reports Q4 2025 revenue of $142 million, up 6% year-over-year. Sohu announced its unaudited financial results for Q4 and full year ending December 31, 2025. The company’s Q4 total revenue was $142 million, a 6% increase from the same period in 2024. Revenue from marketing services was $17 million, and online gaming revenue was $120 million. Full-year 2025 total revenue reached $584 million, with marketing services at $60 million and online gaming at $506 million.

Key Economic Data and Event Preview

Next day 00:00 Beijing time: U.S. January New York Fed 1-year inflation expectations

Next day 02:30 Beijing time: Fed Governor Waller speaks on digital assets

Next day 03:30 Beijing time: Fed Governor Mester participates in Boston University event

Next day 04:15 Beijing time: FOMC voting member and Atlanta Fed President Bostic on monetary policy and economic outlook

Next day 06:00 Beijing time: Fed Governor Mester records a podcast interview

Earnings Reports

Tuesday morning: ON Semiconductor (ON.US)

Tuesday pre-market: BP (BP.US), Philips (PHG.US), Honda (HMC.US), AstraZeneca (AZN.US), Barclays (BCS.US), Coca-Cola (KO.US), Datadog (DDOG.US), CanSemi (CAN.US)