Earnings season is in full swing.
Reporting after the close Thursday were PPG (PPG), Enova (ENVA), Texas Instruments (TXN), Logitech (LOGI), and Seagate (STX).
Wednesday before the open saw AT&T (T), Corning (GLW), General Dynamics (GD), Progressive Insurance (PGR), Starbucks (SBUX), ADP (ADP), ASML (ASML), GE Verona (GEV) throw out fourth quarter and full year numbers.
After the close Wednesday, post-FOMC policy decision, Lam Research (LRCX), Tesla (TSLA), Meta Platforms (META), Microsoft (MSFT), IBM (IBM), Las Vegas Sands (LVS), Levi's (LEVI), and LendingClub (LC) will issue reports.
The Fed is almost 100% certain to keep the federal funds rate at 3.50-3.75%. Any clues from Chairman Powell's presser will move markets north or south. If he signals rate cuts ahead, it's boom time. If he is more sanguine, stocks may take that as a sign that he intends to keep rates at or near where they are currently for the remainder of his term as Chair, which ends in May. Seemingly the most likely path, markets may slow the pace of the rally until President Trump anoints appoints the next Fed Chair. That should be around the start of the third quarter, plenty of time to juice the economy with big cuts ahead of the midterms. July, September, and October would appear to be on the list of FOMC meetings at which cuts would be announced.
Generally speaking, today's FOMC policy decision is little more than a sideshow, as ae earnings announcements. What the Fed is currently knee-deep in is the Japan problem. There has already been a coordinated central bank intervention dropping the USD/JPY from 158 down to 152, which bought some time, though the collateral damage strengthened the euro and pound. The entire exercise is a futile one; eventually all the fiats fail, as they have throughout history, every time. The only matter is whether the destruction of the international financial order will be swift and painful or slow and grinding. Either way, the end game will result in great pain, the U.S. will lose its exceptional privilege of the world's reserve currency, and the the BRICS countries will be calling the shots.
That's the long game, which nobody can time to perfection, and why gold especially has taken flight to new heights.
On the earnings front, briefly, Texas Instruments delivered a fourth quarter above expectations and positive forward guidance, highlighted by increased demand for its analog chips as an integral element in powering AI-related data centers. Pre-market, shares are flying, up more than seven percent.
Logitech (LOGI) beat estimates: Q3 EPS of $1.93, up 21% year-over-year, while revenues grew 6% to $1.42B, but the stock is down two percent pre-open.
PPG (PPG) reported $1.51 per share, missing estimates of $1.57 per share. This compares to earnings of $1.61 per share a year ago, making investors unhappy and selling off by more than two percent.
AT&T (T) is up two percent based on a solid quarter that beat estimates. The company saw improved subscriber growth and issued positive guidance.
General Dynamics (GD) reported fourth-quarter profit of $1.14 billion and EPS of 4.17, beating estimates for 4.11. Shares are flat.
Somewhat of a rarity, Starbucks (SBUX) shares are up more than six percent pre-market as the company's earnings miss estimates, but the chain's U.S. traffic grew for the first time in two years.
ASML was the morning's big winner, as the Netherlands-based chip equipment manufacturer saw strong order flow in the fourth quarter based on AI rollouts, announced plans to cut 1,700 jobs and raised its 2026 sales outlook amid increased AI-related investments. Shares of the company are up five percent prior to the opening bell.
Led by tech, NASDAQ futures are up nearly 200 points just before 9:00 am ET; S&P futures are sporting an 11-point gain while Dow futurs are flat.
Gold has soared again overnight, leaping as high as $5,310 and currently trading in a range around $5,250. Silver has taken a back seat this morning, but still advanced to as high as $116 and is holding around $114. Shanghai reports silver prices at $131, a spread of more than $15 above U.S. prices and indications for higher price targets overall. Silver is targeting $140-150 for March, gold, $6,000. The rally in precious metals, which has been on a torrid pace since October of 2025, is still in its early stage.
Any missteps by government or financial authorities is likely to send metals into overdrive, which is remarkable considering their recent moves, but there are a slew of issues on the table, the biggest being U.S. resumption of threats against Iran, general malaise in Minnesota, and the buffering of Japanese bonds keeping the yen afloat with coordinated intervention. The U.S. cannot afford to have Japan's central authority sell U.S. treasuries and upset the delicate balance between inflation and growth in the U.S. A yield on the 10-year note of anything above 4.80% (currently 4.25%) would signal distress globally.
While Secretary Bessent and Fed Chair Powell continue to monitor the situation in Iran, they risk a revolt in the form of a loss of confidence. To date, they ='ve managed to keep the treasury complex within reasonable bounds, but a military strike on Iran could send yields - along with gold and silver - soaring. The monetary authorities are holding their own in the face of increasingly-dangerous policies from the Trump administration. The military has been moving assets into the area for weeks and appear to be preparing for an attack which would likely set off a major conflict. Iran is on high alert and will bomb Israel and U.S. bases throughout the region if they are assaulted.
Trump and the neocons throughout the Washington establishment continue to play with fire. Sooner or later, somebody is going to get burned. Meanwhile, it seems that the U.S. and Europe have given up on Ukraine and may be pondering moving the narrative to the Middle East, hoping their constituents won't notice their massive failure, allowing Russia a military victory and complete control of Ukraine.
At the Close, Tuesday, January 27, 2025:
Dow: 49,003.41, -408.99 (-0.83%)
NASDAQ: 23,817.10, +215.74 (+0.91%)
S&P 500: 6,978.60, +28.37 (+0.41%)
NYSE Composite: 22,878.22, +49.08 (+0.22%)
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