Preview of US Stock Market | Three major stock index futures fell together, and silver rose above $90. US November PPI and retail sales data will be announced tonight.

Pre-market Market Trends 1. Before the market on January 14 (Wednesday), the futures of the three major stock indexes of the US stock market all fell. As of the time of writing, Dow Jones futures fell by 0.32%, S&P 500 index futures fell by 0.42%, and Nasdaq futures fell by 0.63%. 2. As of the time of writing, the Germany DAX index fell by 0.41%, the UK FTSE 100 index rose by 0.26%, the France CAC 40 index rose by 0.03%, and the European Stoxx 50 index fell by 0.24%. 3. As of the time of writing, WTI crude oil rose by 1.19%, to $61.88 per barrel. Brent crude oil rose by 1.19%, to $66.25 per barrel. Market News The US Supreme Court may make a ruling on tariffs tonight. Last Friday, the court did not rule on the controversial Trump tariff case. If the Supreme Court ultimately rules that the related tariff measures are illegal, it will directly weaken Trump's iconic economic policy and may be the biggest legal setback he has faced since returning to the White House. It is widely believed that the Trump administration still has various legal tools to continue advancing its tariff agenda in the event of an unfavorable ruling. Fed Rate Cut Expectations Change! The SOFR trading direction turns hawkish, with funds betting that the Federal Reserve will remain on hold for the whole year. Senior traders focusing on options trading are increasingly inclined to exclude expectations of further rate cuts by the Federal Reserve in 2026, and instead bet that the Federal Reserve will maintain interest rates unchanged throughout the year. Since the release of multiple labor market statistics in December, combined with the latest CPI showing a stable cooling pace of inflation in the US, traders' expectations for rate cuts by the Federal Reserve in 2026 have continued to soften. Data, including the mix of good and bad labor market statistics in December, imply a slight recovery in the US labor market at the end of the year, significantly reinforcing the narrative of a "soft landing." US Stock Market Out of Touch? Investment guru predicts a 20% decline in the Dow Jones index in 2026. According to the latest forecast from Ariel Investments' Chairman and Co-CEO, John Rogers, the US economy may experience a minor economic recession by the end of the year, and the US stock market will also decline. He predicts that the Dow Jones index could significantly decline by 20% close to bear market territory, mainly due to the pressure felt by average American consumers in the face of high living costs. As major Wall Street financial giants generally remain bullish on the outlook for the US stock market in 2026, the forecast of veteran US fund manager Rogers is quite different. He emphasizes that although wealthy American consumers are in good financial shape, ordinary Americans are struggling to pay large bills in the long run. "Time Bomb" Hidden in US Treasuries! Morgan Stanley: Basis trading has expanded to $1.5 trillion, be cautious of a market storm reoccurrence in 2020. Morgan Stanley strategist points out that the current scale of basis trading in US Treasuries has expanded to approximately $1.5 trillion, highlighting the need to closely monitor the scale of this trading to avoid a repeat of the drastic market fluctuations seen in 2020. This trading strategy is led by hedge funds and focuses on capturing small price discrepancies between the US Treasury cash market and futures market for arbitrage. The bank estimates that the scale of this strategy has grown by 75% compared to its peak in 2019, and the pace of expansion of its nominal trading volume in recent years has exceeded the pace of US Treasury issuance growth. The strategist states that the current trading activity is "not unprecedented," but still requires close attention, especially during periods of tight liquidity or market volatility. From a trading perspective, if hedge funds are forced to rapidly close out positions, bond dealers may not be able to handle the sudden increase in trading volumes. Silver Surges Over $90, Setting a New High Again! Risk aversion drives gold to rise simultaneously. As of the time of writing, spot silver has risen by nearly 4%, to $90.36 per ounce, reaching a historical high of $91.56 per ounce at one point during the day. Boosted by the rise in silver prices, the total market value of silver has surpassed $5 trillion for the first time, making it the second-largest asset globally, surpassing NVIDIA Corporation. Concerns over the Federal Reserve's independence and political turmoil in the Middle East have driven demand for safe-haven investments into the precious metals market. As of the time of writing, spot gold has risen by nearly 1%, to $4629 per ounce. Market analysts say that the political and economic uncertainty surrounding the GEO Group Inc will continue to boost investment demand, and there is still room for gold and silver prices to rise. From the "Copper Boom" to the "Tin Frenzy"! LME tin prices break through $51,000 to hit a new high. On Wednesday, LME tin prices rose by as much as 4.3%, reaching $51,675 per ton, surpassing the previous high set in 2022. Usually, LME tin is the least liquid of the six metals traded on the London Metal Exchange, but its increase last year was close to 40%, and so far this year it has risen by more than a quarter. This price surge is fueled by Chinese investors entering the global precious metals and industrial metals markets with many large stock funds also betting on a sharp increase in commodity futures along with the stock market. Stock-Specific News Bank of America Corp (BAC.US) Q4 earnings exceeded expectations. The financial report showed that Bank of America Corp's Q4 net revenue was $28.37 billion, beating the market's expectation of $27.76 billion; net interest income was $15.75 billion, exceeding the market's expectation of $15.48 billion. Trading income (excluding deferred valuation adjustments) was $4.53 billion, compared to the market's expectation of $4.33 billion. The bank stated that despite various risks, it remains optimistic about the US economy in 2026. Wells Fargo & Company (WFC.US) Q4 earnings fell short of expectations. The financial report showed that Wells Fargo & Company's Q4 revenue was $21.29 billion, falling short of the market's expectation of $21.64 billion; net interest income was $12.33 billion, falling short of the market's expectation of $12.43 billion. Net profit was $5.36 billion. Diluted earnings per share were $1.62, below the market's expectation of $1.66. The bank expects net interest income to be around $50 billion in 2026, due to lower short-term funding costs and asset growth. Tesla, Inc. (TSLA.US) FSD major shift: from "buyout" to full subscription, effective after February 14. Tesla, Inc. announced a complete change in its sales model for the advanced driving assistance system "Full Self-Driving" (FSD), fully transitioning to a monthly subscription service. CEO Elon Musk announced this change on the social media platform X, planned to take effect after February 14. Musk did not specify the reason for the decision, and the service currently has a monthly fee of $99. This move will eliminate the one-time buyout fee of around $8,000 for FSD, significantly reducing the initial threshold for users to experience this technology. Facing sluggish sales growth, Tesla, Inc. is shifting its strategic focus to technology-driven growth areas such as FSD, autonomous driving taxis, and the Siasun Robot & Automation business. Netflix (NFLX.US) plans to change to an all-cash acquisition of Warner Bros (WBD.US) to expedite the acquisition process against Paramount (PSKY.US). According to sources, Netflix is adjusting the terms of the acquisition of Warner Bros to explore acquiring the company's film studio and streaming business in an all-cash manner. This adjustment is aimed at accelerating what was originally expected to be a months-long transaction. The acquisition not only faces opposition from some political figures but also faces opposition from rival bidder Paramount, with even institutional investors showing clear differences in their attitudes towards this deal. Citigroup (C.US) slashes another thousand jobs, accelerating the target of "losing weight" by 20,000 over two years. According to sources, Citigroup will initiate a new round of layoffs this week, with an expected reduction of around 1,000 positions. This layoff is the latest development in the bank's previously announced plan to "cut approximately 20,000 jobs by the end of this year." According to Citigroup's annual report, the total number of full-time employees in the bank was around 229,000 by the end of 2024. The company stated that the reduction in workforce will continue through 2026 but did not disclose specific layoff numbers. The era of "long-term maintenance + low-frequency injection" for weight loss drugs begins, with Amgen (AMGN.US) leading the $100 billion market with its "monthly dose" advantage. US pharmaceutical giant Amgen revealed that the latest clinical trial results of its experimental weight loss drug, MariTide, show that when obese patients only receive monthly injections, they are able to maintain a stable weight loss trend over two years. In significant contrast, most widely used weight loss drug injections (such as Novo Nordisk A/S Sponsored ADR Class B and Eli Lilly's most popular weight loss drug series) are typically injected once a week. Important Economic Data and Events Preview 21:30 Beijing time: US November retail sales month-on-month 21:30 Beijing time: US November PPI 22:50 Beijing time: 2026 FOMC voters, Philadelphia Fed President Paulson speaks on economic outlook 23:00 Beijing time: Fed Governor Milan speaks in Athens 00:00 Beijing time the next day: US January IPSOS major consumer sentiment index PCSI 01:00 Beijing time the next day: 2026 FOMC voters, Minneapolis Fed President Kashkari speaks 03:00 Beijing time the next day: Fed releases Beige Book on economic conditions 03:10 Beijing time the next day: FOMC permanent voter, New York Fed President Williams delivers opening remarks at an event Earnings Forecast Thursday pre-market: Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR (TSM.US), Morgan Stanley (MS.US), Goldman Sachs Group, Inc. (GS.US), BlackRock, Inc. (BLK.US)