S&P 500 – 6,941.81 (-0.33%)

Dow Jones – 50,188.14 (+0.10%)

NASDAQ – 23,102.48 (-0.59%)

• U.S. Equities: U.S. stocks were largely unchanged Tuesday as investors absorbed December’s retail sales data and weighed broader economic signals.
• Holiday Retail Sales: December retail sales were flat, missing expectations, signaling a slowdown in consumer spending. While higher-income households continued strong activity, spending among middle- and lower-income groups remained cautious, tempering year-end economic growth. Control group retail sales, excluding autos, gas, and building materials, declined 0.1% versus the expected 0.4% rise.
• Corporate Moves – Paramount & Warner Bros.: Paramount sweetened its $30-per-share hostile bid for Warner Bros. Discovery by adding a ticking fee and covering potential Netflix-related costs, highlighting regulatory certainty and shareholder protections.
• Super Bowl Trading – Kalshi: Kalshi reported record Super Bowl Sunday trading, surpassing $1 billion, driven by bets on halftime performer Bad Bunny.
• Cryptocurrency – Bitcoin: Bitcoin slipped below $70,000 following a steep sell-off but shows early signs of stabilization. Analysts caution that prices could dip further, though long-term gains remain possible.
• Disney Bond Offering: Walt Disney is raising $4 billion through investment-grade bonds to repay debt and fund strategic initiatives, marking its first offering since 2020.
• Global Markets: Asian markets closed higher overnight, while European markets mostly traded up. Bond yields fell after the soft retail report, with the 10-year Treasury down to 4.14% and the 2-year at 3.45%. Oil slid amid mixed signals on Middle East supply risks.
• Company Highlights:
  • Coca-Cola: Fell after revenue missed expectations, growing 2.2% to $11.8 billion versus $12.03 billion forecast.
  • Spotify: Surged after adding 38 million new users, surpassing analyst forecasts and posting improved operating income and gross margins.
  • Alphabet: Dropped after announcing a $20 billion bond sale, including rare 100-year offerings in Switzerland and the U.K.
  • CVS Health: Fell despite beating earnings and revenue, with 2026 revenue guidance seen below analyst expectations.
  • Software Stocks: Adobe and Salesforce continued to struggle following last week’s selloff.
  • Taiwan Semiconductor (TSM): Rose on strong January revenue growth and potential tariff exemptions.
  • AppLovin: Jumped 13% after a short seller retracted a false report.
  • Ford: Ford’s quarterly earnings missed forecasts but the company’s CEO sees a stronger year in 2026.
• Retail & Commodities: Retail stocks, including Best Buy, Gap, Macy’s, Nike, and Kohl’s, pulled back 2% or more, reversing last week’s rotation into value and cyclical names. Silver, gold, and mining stocks saw slight retracements.
• Crypto Market Pressure: Bitcoin’s fall below $70,000 weighed on crypto-linked stocks, with analysts noting recent selling is driven mainly by derivatives market deleveraging rather than broader trends.

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"Bitcoin is a good thing. It’s a much better form of money than pieces of paper." — Elon Musk

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Notable Stocks

• Alphabet (GOOGL)
• Coca Cola (KO)
• Nvidia (NVDA)
• Intel (INTC)
• Salesforce (CRM)

Weekly Notables

Holiday Retail Spending Disappoints

Retail sales stalled in December, marking a disappointing end to the holiday season. Sales were flat following a 0.6% rise in November, missing the 0.4% gain economists surveyed by Dow Jones had expected. Excluding autos, retail activity also held steady, below the projected 0.3% increase. On a year-over-year basis, total sales rose 2.4%, down from November’s 3.3% pace, and failing to keep up with inflation, as December’s consumer price index increased 2.7%. Sales ex-autos were up 3.3% annually, while the “control group” of retail spending—a key GDP component—fell 0.1% for the month.

Paramount Sweetens WBD Bid Without Raising Per-Share Offer

Paramount has enhanced its hostile bid for Warner Bros. Discovery (WBD), adding a “ticking fee” and agreeing to cover potential costs tied to Netflix’s competing deal, but stopped short of increasing its $30-per-share cash offer. The original $30 all-cash offer, launched in December, remains in place, with Paramount emphasizing that it believes its bid is superior to Netflix’s proposed acquisition of WBD’s streaming and studios assets. Paramount CEO David Ellison called the offer “fully backed and fully committed,” highlighting regulatory certainty and protection against market volatility.

Earnings Spotlight: Cisco (CSCO)

CSCO will report fiscal Q2 results today, guiding revenues between $15B and $15.2B Cisco benefits from AI-driven networking demand, including Silicon One. The company’s Security segment, aided by Splunk, is expected to post growth.

What's Ahead

Investor focus remains on economic releases, including the January employment report today and the CPI inflation data on Friday. Economists forecast nonfarm payrolls rising by 75,000 and the unemployment rate steady at 4.4%. 

February 11: January nonfarm payrolls and expected earnings from McDonald's (MCD), T-Mobile (TMUS), Shopify (SHOP), Humana (HUM), Cisco (CSCO), and AppLovin (APP).

February 12: January existing home sales, and expected earnings from Anheuser-Busch (BUD), Applied Materials (AMAT), Arista Networks (ANET), Vertex Pharmaceuticals (VRTX), Brookfield (BN), Airbnb (ABNB), and Coinbase Global (COIN).

February 13: January CPI and January core CPI and expected earnings from Enbridge (ENB) and Moderna (MRNA).

February 16: U.S. markets closed for President's Day.

February 17: Expected earnings from Medtronic (MDT), Constellation Energy (CEG), and Palo Alto Networks (PANW).