• Market exploded to near record highs. The S&P 500 and the NASDAQ recorded weekly gains, bouncing back from negative results the previous two weeks. While the S&P 500 was little changed on Friday, the index had a strong performance this week. The S&P 500 finished just four points shy of a record high that it set three weeks earlier; the NASDAQ and the Dow were around a percentage point below their all-time peaks. 
• Inflation continued to advance. Wednesday’s Consumer Price Index report revealed that inflation had extended last month. Inflation accelerated in January, rising 3% on an annual basis, indicating that the Federal Reserve's push to drive inflation down to a 2% annual rate has stalled out, at least temporarily.
• The Feds made a decision. U.S. Federal Reserve Chair Jerome Powell said in congressional testimony that Fed policymakers need to see more progress in curbing inflation before considering further interest-rate cuts. 
• Retail sales have dropped. U.S. consumers slowed their shopping down. In January, retail sales fell 0.9% on a seasonally adjusted basis compared with the previous month. The result was well below most economists’ expectations. It was also the biggest monthly decline in a year. 
• Volatile treasury yields. U.S. Treasuries were somewhat volatile as yields rose in response to the week’s inflation data, with the benchmark 10-year Treasury yield touching an intraday high of 4.66% after Wednesday’s CPI report.
• European markets steamed ahead. After lagging the U.S. equity market in 2024 and for much of the past decade, European stocks are now outperforming their U.S. peers this year. A European index was up more than 12% year to date at Friday’s close, while the S&P 500 was up around 4%.
• UK sees surprise GDP growth. Last Thursday a report on fourth quarter GDP came in. The United Kingdom’s economy saw a 0.1% GDP growth rate at the end of 2024, exceeding economists’ expectations after stagnating in the previous quarter with a 0.0% reading. The Bank of England recently cut its benchmark interest rate.  
• Bitcoin traded at the $97,000 level.
• Coinbase shares dropped. Despite reporting a surge of more than 130% in revenue from last year, Coinbase shares headed lower.

Most Active Stocks

• Tesla (TSLA)
• Intel (INTC)
• SoundHound AI (SOUN)
• Super Micro Computers (SMCI)
• BigBear.ai Holdings (BBAI)

Biggest Gainers

• WeRide, Inc. (WRD) +83.46%
• Recursion Pharmaceuticals (RXRX) +23.88%
• Kingsoft Cloud Holdings Limited (KG) +19.94%
• The Goodyear Tire Company (GT) +17.26%
• Procore Technologies (PCOR) +16.51%

Biggest Losers

• SoundHound AI (SOUN) -28.10%
• Informatica (INFA) -21.53%
• Twilio (TWLO) -15.01%
• Hecla Mining Company (HL) -14.60%
• GoDaddy (GDDY) -14.28%

Weekly Notables

Amazon North Carolina Workers Reject Union

Amazon workers in North Carolina have voted against joining a union. Roughly three-quarters of voters were opposed. A simple majority of voters among the 4,300 workers at the warehouse in Garner, North Carolina, near Raleigh, was necessary to form the union. According to the National Labor Relations Board, or NLRB, among voters, 2,447 were opposed and 829 were in favor of joining a union. "Today's result is not a surprise," said John Logan, a San Francisco State University professor of labor and employment studies. "The odds are massively against any group of workers trying to form a union at Amazon," he said, noting the company's campaigns of anti-union messaging, among other tactics.

OpenAI Rejects Elon Musk's Offer for This Reason

OpenAI sent a short letter to Elon Musk’s lawyer, rejecting the billionaire’s acquisition offer. According to William Savitt, the attorney for OpenAI, the “much-publicized ‘bid’ is in fact not a bid at all." Savitt made the remark to Marc Toberoff, who represents Musk. Musk had been leading a group of investors in offering to buy control of OpenAI for $97.4 billion.

The Week Ahead

• Potential market moving catalysts this week: There are no major reports scheduled for Monday. On Tuesday investors can look forward to the Empire State Manufacturing, the NAHB Housing Market Index, and Net Long-Term TIC Flows. Wednesday will deliver Building Permits, EIA Crude Oil Inventories, Housing Starts, and the MBA Mortgage Applications Index. On the deck for Thursday is Continuing Claims, EIA Natural Gas Inventories, Initial Claims, Leading Indicators, and the Philadelphia Fed Index. Friday will wrap the week up with Existing Home Sales and the University of Michigan Consumer Sentiment - Final.
• Earnings on deck this week: UFP Industries Inc. (UFPI), Noble Corporation PLC (NE), Transocean Ltd. (RIG), Medtronic PLC (MDT), Vulcan Materials Co. (VMC), Baidu Inc. (BIDU), Watsco Inc. (WSO), Genuine Parts Co. (GPC), Arista Networks Inc. (ANET), Occidental Petroleum Corp. (OXY), Cadence Design Systems Inc. (CDNS), Analog Devices Inc. (ADI), Garmin Ltd. (GRMN), Clean Harbors (CLH), Wix.com Ltd. (WIX), Wingstop Inc. (WING), Carvana Co. (CVNA), American Water Works Company (AWK), Toast Inc. (TOST), Walmart Inc. (WMT), Alibaba Group Holding Ltd. (BABA), Southern Co. (SO), NetEase Inc. (NTES), Cheniere Energy Inc. (LNG), Booking Holdings Inc. (BKNG), Newmont Corporation (NEM), Live Nation Entertainment Inc. (LYV), Balchem Corp. (BCPC), TXNM Energy Inc. (TXNM), Telephone and Data Systems Inc. (TDS).