US DATA: U.Mich Inflation Expectations and Consumer Sentiment Revised Lower

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• Stocks rebounded after falling to new 4 week lows this morning after Pres Trump said he would not use force to secure a "piece of ice" - meaning Greenland as he orated at length at the World Economic Forum in Davos this morning.
• Nevertheless, Denmark officials said the US challenge over Greenland sovereignty "is still there" while European Parliament formally suspended the trade deal process (Turnberry Deal) after Trump's Greenland threats. Geopolitical risk remains fluid.
• Currently, the DJIA trades up 428.44 points (0.88%) at 48914.64, S&P E-Mini Futures up 67.5 points (0.99%) at 6896.75, Nasdaq up 260 points (1.1%) at 23212.94.
• A mix of Information Technology, Energy and Financials sector shares led advances in the first half: Intel Corp +10.33%, Teledyne +8.53, Advanced Micro Devices +8.01%, Western Digital +7.81%, Citizens Financial Group +6.35%, Micron Technology +6.29%, Generac Holdings +6.10%, Sandisk Corp +5.19%, ON Semiconductor +4.83%, Invesco +4.62%, Texas Pacific Land Corp +4.51% and Devon Energy +4.38%.
• Another standout was Moderna, surging +9.14% on upgrades and positive headlines on it’s cancer vaccine.
• Conversely, Consumer Staples and Utilities underperformed in the first half: Kraft Heinz Co -5.20%, Philip Morris -1.94%, Keurig Dr Pepper -1.82% and Hershey Co -1.78% buoyed Staples while Sempra -3.06%, Consolidated Edison -1.30%, FirstEnergy Corp -0.87% and American Electric Power -0.76% weighed on the Utilities sector.
• Reminder, a handful of stocks expected to announce earnings after the close include: Prologis Inc, Knight-Swift Transportation, Pinnacle Financial and Kinder Morgan.

Canadian industrial prices pulled back in December on a Y/Y basis, with IPPI (industrial prices) slowing to 4.9% from 5.9% for a 4-month low and the RMPI (raw materials prices) to 6.4% after 7.2%. The core IPPI retreated slightly (5.8% after 6.1% for a 3-month low). 

• This won't be a mover for the BOC ahead of its meeting next week. We haven't taken much signal from these indices for the last several months for the purposes of identifying future trends in CPI - even as factory gate inflation (IPPI) has soared, consumer price inflation pressures have started to abate.
• That's largely because the aggregate pipeline indices have been heavily distorted by precious metals: while 13 of 21 IPPI commodity groups posted year-over-year increases, the rise was driven by the likes of silver (+107%), gold (+58%), and unwrought platinum (+82%).
• That said there were large increases in key food areas including poultry (+39%) and beef/veal (+20%) which could keep already elevated CPI food inflation elevated.
• Similarly the RMPI (ex-energy) is not a particularly useful metric of pipeline pressures as the recent gains largely reflect higher precious metals prices (+74% Y/Y) though there was also a significant increase in cattle prices (+13%) which may presage further upside pressure in related CPI food prices.