Overnight US stocks | The three major indexes fell and Apple Inc. (AAPL.US) dropped more than 4%.

On Thursday, all three major indexes fell as US retail sales in December were lower than expected, and initial jobless claims last week exceeded expectations. [US Stocks] At the close, the Dow fell 68.42 points, or 0.16%, to 43153.13 points; the Nasdaq fell 172.94 points, or 0.89%, to 19338.29 points; the S&P 500 fell 12.57 points, or 0.21%, to 5937.34 points. Apple Inc. (AAPL.US) fell over 4%, NVIDIA Corporation (NVDA.US) fell nearly 2%, and Tesla, Inc. (TSLA.US) fell over 3%. The Nasdaq Golden Dragon Index rose 0.2%, DouYu International Holdings Ltd. Sponsored ADR (DOYU.US) surged 27%, and XPeng, Inc. ADR Sponsored Class A (XPEV.US) rose 6%. [European Stocks] The German DAX30 index rose 28.40 points, or 0.14%, to 20644.27 points; the UK FTSE 100 index rose 91.54 points, or 1.10%, to 8392.67 points; the French CAC40 index rose 160.15 points, or 2.14%, to 7634.74 points; the European Stoxx 50 index rose 72.64 points, or 1.44%, to 5104.95 points; the Spanish IBEX35 index fell 65.27 points, or 0.55%, to 11833.23 points; the Italian FTSE MIB index rose 174.04 points, or 0.49%, to 35821.00 points. [Asia-Pacific Stock Market] The Nikkei 225 index rose 0.33%, the Indonesia Jakarta Composite Index rose 0.39%, and the South Korea KOSPI index rose 1.23%. [Cryptocurrency] Bitcoin fell slightly to $100,099.5. [Gold] Spot gold rose 0.67% to $2714.46 per ounce; COMEX gold futures rose 1.03% to $2745.70 per ounce. [Oil] New York Mercantile Exchange's light crude oil futures for February delivery fell $1.36 to close at $78.68 a barrel, down 1.7%; London's Brent crude oil futures for March delivery fell 74 cents to close at $81.29 a barrel, down 0.9%. [Forex] The US Dollar Index, which measures the dollar against six major currencies, fell 0.12% on the day to 108.955 at the close of the market. At the end of the New York market, 1 euro exchanged for $1.0302, up from $1.0293 the previous trading day; 1 pound exchanged for $1.2235, up from $1.2231 the previous trading day. 1 dollar exchanged for 155.29 yen, down from 156.46 yen the previous trading day; 1 dollar exchanged for 0.9109 Swiss francs, down from 0.9127 Swiss francs the previous trading day; 1 dollar exchanged for 1.4396 Canadian dollars, up from 1.4329 Canadian dollars the previous trading day; 1 dollar exchanged for 11.1466 Swedish kronor, down from 11.1543 Swedish kronor the previous trading day. [Macro News] US retail sales in December were below expectations. Data from the US Department of Commerce showed that US retail sales rose by 0.4% in December, lower than the expected 0.6% and previous value of 0.7%, mainly due to declines in building materials and food services. However, of the 13 categories in the report, 10 showed growth, with car sales continuing to surge, indicating continued strong demand from consumers during the holiday season. Retail sales excluding cars and gasoline rose by 0.3% month-on-month, slightly below the expected 0.4% and previous value of 0.2%. Retail sales excluding cars rose by 0.4% month-on-month, below the expected 0.5% but above the previous value of 0.2%. Sales in the control group, excluding food services, car dealers, building materials stores, and gas stations (used by the government to calculate GDP from goods expenditures), rose by 0.7% in December, the highest in three months. Analysts believe that this figure, above expectations, is a positive signal for the consumer sector, showing that consumers are still increasing spending (mainly to pay for rising prices due to inflation). US initial jobless claims rose last week but remained at historically low levels. According to reports, initial claims for unemployment benefits in the US rose by 14,000 to 217,000 in the week ending January 11. Weekly claims for unemployment benefits are considered an indicator of layoffs. Despite some signs of weakness in the labor market in 2024, job opportunities are still abundant, and layoffs remain at historically low levels. Last week, the Labor Department's nonfarm payroll report stated that employment surged in December, and the unemployment rate fell. Employers added 256,000 jobs last month, and the unemployment rate dropped to 4.1%. The final employment report for 2024 emphasized that the economy and hiring could continue to grow at a solid pace even with interest rates far above pre-pandemic levels. Therefore, after three rate cuts at the end of 2024, the possibility of further rate cuts by the Federal Reserve in the coming months is much smaller. Federal Reserve Board Member Waller: If data allows, cannot rule out the possibility of a rate cut in March. Federal Reserve Board Member Waller said that the CPI data for December was "very good," and if there is more data like this, "we could see a rate cut in the first half of this year." Waller stated that he does not rule out the possibility of a rate cut in March. Waller believes that the US labor market is solid but not overheated, and he also believes that tariffs will not have a significant impact on inflation. New York Fed report shows it could continue QE. Data released by the New York Fed on Thursday indicated that the Federal Reserve is not immediately under pressure to stop reducing its holdings of Treasury bonds and Mortgage-Backed Securities (MBS). The report stated that as of January 7, its recently launched Reserve Demand Elasticity Index remained relatively stable at -0.04 compared to recent readings, indicating that "estimates suggest reserves continue to be."Adequate". For the Federal Reserve, ample reserve levels mean that liquidity in the financial system remains strong enough, and the Fed can continue to reduce its balance sheet by not reinvesting funds after some of its holdings of treasuries and mortgage-backed securities mature. The reserve demand elasticity index helps measure liquidity conditions and provides early warning of shortages, allowing for ample preparation time. The Fed has also slowed down the pace of quantitative tightening and established a mechanism called the Standing Repo Facility to provide quick funds to eligible banks to swiftly address any issues that may arise in the market.Nominee for US Treasury Secretary Benson: Budget deficit issue serious, supports Fed independence. Nominee for US Treasury Secretary Benson appeared at a Senate hearing, warning that if most of the Republican tax cuts in 2017 are not extended after expiring at the end of this year, the US will face an economic crisis that hits the middle class and working class. He also stated that under his management, the federal government debt "will not default", and he respects the Fed's independence in monetary policy. In addition, he expressed support for expanding sanctions on Russian oil companies. Benson also emphasized the importance of addressing the budget deficit, stating that the US needs to "restore fiscal order" by adjusting domestic non-essential spending. He pointed out that non-essential spending, excluding welfare such as Social Security and Federal Health Insurance, has "increased by a staggering 40% over the past four years". Philadelphia Fed Manufacturing Outlook Index jumps to nearly four-year high. An indicator measuring manufacturing activity in the Philadelphia area surged to its highest level in nearly four years, signaling improved business confidence before President Trump's re-election. The Philadelphia Fed said on Thursday that its business activity index for January climbed to 44.3, the highest level since April 2021. This number was higher than December's -10.9, indicating rapid economic expansion this month, in stark contrast to economists' expectations of a slight contraction. The report stated that new orders and shipments in the survey also rose significantly, reaching multi-year highs. The Philadelphia Fed said that several indicators in the survey measuring future economic activity have increased, indicating more widespread confidence in overall economic growth over the next six months. US homebuilders' sales expectations decline due to rising financing costs. Optimism among US homebuilders about sales prospects for this month has dropped due to concerns that soaring mortgage rates may scare off buyers. Data from the National Association of Home Builders (NAHB)/Wells Fargo & Company shows that the index measuring sales expectations for the next six months fell by 6 points to 60, the first decline since June. Despite the decline in this index, the January builder confidence index rose by 1 point to a 9-month high of 47, benefiting from more optimistic views on current sales and potential buyer traffic. The incoming Trump administration's hopes of creating a favorable regulatory environment also boosted builder confidence. Mixed signals indicate that builders are feeling uneasy. The industry has long attracted buyers through generous sales incentives, including builders paying upfront fees instead of customers to lower mortgage interest costs. However, data from the Mortgage Bankers Association (MBA) shows that mortgage rates in the US broke 7% last week, reaching the highest level since early May, and continuing a steady rise for several months, possibly limiting the real estate market. The index measuring current sales rose to 51, the highest since May; the potential buyer traffic index rose to a 9-month high of 33. Overnight reverse repurchase usage by the Federal Reserve falls below $1 trillion, close to four-year low. The Federal Reserve's overnight reverse repurchase (RRP) agreement balance fell below $1 trillion, approaching its lowest level in nearly four years. On Thursday, about 34 counterparties placed $945 billion in RRP funds, the lowest level since April 2021, down from $1.2 trillion the previous trading day, the lowest number of bidders since May 2021. Bank of Canada to end quantitative tightening in months. The Bank of Canada has announced plans to stop shrinking its balance sheet in the first half of this year. This makes it one of the first major central banks to suggest an end to quantitative tightening. Deputy Governor Toni Gravelle said in Toronto that after the plan ends, the bank will begin replacing assets through regular repurchase operations and will then start buying treasuries in the fourth quarter of this year. The bank expects to start buying bonds in the secondary market no earlier than the end of 2026 and does not expect to buy in the primary market. [Stock News] Morgan Stanley is far from achieving its $1 trillion wealth business goal. Morgan Stanley's wealth management head Andy Saperstein told investors in 2022 to expect net new assets to increase by about $1 trillion every three years. Shortly after, then-CEO and designer of the wealth management strategy James Gorman officially established this goal in a highly anticipated strategic update. However, Morgan Stanley is far from the target. Morgan Stanley announced on Thursday that its wealth management business brought in $252 billion in net new assets last year. This was lower than $282 billion in 2023 and $311 billion in 2022. To achieve the $1 trillion goal in the three years ending in 2025, the company must add $466 billion in net new assets this year, an 85% increase from the previous year. US media: Alphabet Inc. Class C will not add fact-checking despite EU law. Alphabet Inc. Class C told the EU in a copy of the letter that despite requirements of the new EU law, it will not add fact-checking to search results and YouTube videos, nor will it use fact-checking in ranking or removing content. It is reported that Alphabet Inc. Class C has never made fact-checking part of its content moderation practices. The company privately told EU legislators that it does not intend to change its practices, but reaffirmed its stance before a voluntary guideline becomes law in the near future. [Major Bank Ratings] Morgan Stanley: Citigroup Inc. (C.US) target price raised from $104 to $109 UBS: Adobe (ADBE.US) target price lowered from $600 to $560