US EQUITY OPEN: Stocks mixed at the open after soft core CPI

US EQUITY OPEN: Stocks mixed at the open after soft core CPI; JPM lags after earnings miss, JETS down on DAL guidance miss

• US stocks opened mixed, with Energy, Communications, and Industrials sectors showing strength, while Financials and Healthcare lagged.
• Delta Air Lines' disappointing guidance weighed on the airline sector, impacting the JETS ETF.
• Core US inflation data was softer than expected, influencing rate cut expectations and weakening the dollar.

US stocks opened with mixed performance as market participants digested a range of corporate earnings and economic data. The Energy, Communications, and Industrials sectors led the gains, while Financials and Healthcare faced downward pressure. Notably, JPMorgan (JPM) shares fell by 2.6% after the bank reported earnings and revenue that missed expectations, despite an impressive 2026 net interest income (NII) outlook. This contributed to the broader underperformance in the Financials sector.

The airline sector faced headwinds following Delta Air Lines' (DAL) disappointing earnings per share (EPS) guidance for the first quarter and fiscal year 2026. This sentiment was reflected in the JETS ETF, which declined by approximately 0.7%. The guidance miss from Delta has raised concerns about the sector's near-term profitability, prompting traders to reassess their positions in airline stocks.

In the broader economic context, softer-than-expected core US inflation data for December provided a temporary boost to equity futures in pre-market trading. However, this optimism was tempered as the session progressed. The inflation data has reinforced market expectations for two additional 25 basis point rate cuts in 2026, which in turn has exerted downward pressure on the US dollar and front-end yields. Traders are now closely monitoring upcoming Federal Reserve commentary and the US 30-year bond auction for further insights into monetary policy direction.

In the commodities market, oil prices have extended their gains amid geopolitical tensions, following a statement from President Trump on Truth Social regarding assistance to Iran after the killing of protestors. This development has heightened geopolitical risk, leading to increased demand for safe-haven assets such as silver and gold, which have also seen price increases.

In stock-specific news, AMD (AMD) and Intel (INTC) received upgrades from KeyBanc, while Cardinal Health (CAH) raised its fiscal year 2026 guidance. BlackRock (BLK) announced a reduction in its global headcount by approximately 1%, reflecting ongoing cost management efforts. Albemarle (ALB) was upgraded by Deutsche Bank, whereas Alcoa (AA) and Synopsys (SNPS) faced downgrades from Wells Fargo and Piper Sandler, respectively.

Trader Insight:

• Some traders may consider monitoring the JETS ETF for further reactions to airline sector developments, particularly in light of Delta Air Lines' guidance.
• Market participants are watching the US dollar's performance, especially in currency pairs like USD/JPY, as rate cut expectations evolve.
• Energy sector ETFs such as XLE could be of interest as oil prices react to geopolitical tensions.
• Traders are assessing the impact of JPMorgan's earnings miss on the broader Financials sector, with potential implications for ETFs like XLF.

Disclaimer: This is not trading advice. For informational purposes only.