China inflation, China trade data, Nikkei high

Oil prices rose after Britain and the United States carried out military strikes against targets in Houthi-controlled areas of Yemen, U.S. officials said, as tensions in the Red Sea mounted.

Global benchmark Brent jumped 1.87% higher to $78.90 a barrel Friday Asia trading hours, while the U.S. West Texas Intermediate futures climbed 2.05% to $73.49 per barrel.

“These targeted strikes are a clear message that the United States and our partners will not tolerate attacks on our personnel or allow hostile actors to imperil freedom of navigation in one of the world’s most critical commercial routes,” U.S. President Joe Biden said in a statement Thursday evening.

– Lee Ying Shan

Investors are eagerly looking forward to rate cuts this year — the U.S. Federal Reserve signaled at least three, which would end an aggressive interest rate-hiking campaign for the last couple of years.

The question is when the first of the rate cuts will come.

BofA created a screen of which global companies might outperform as rates fall, and have “not yet rallied as strongly” as the average historical performance following the initial cut of the cycles.

It also screened for companies under scenarios such as whether the Fed cuts at a faster or slower pace than the European Central Bank — and vice versa.

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— Weizhen Tan

Inflation rose at a greater-than-expected pace in December.

The consumer price index increased by 0.3% last month from November. Year over year, CPI was up 3.4%. Economists polled by Dow Jones expected CPI to have risen 0.2% month over month in December and 3.2% year over year.

However, So-called core CPI, which strips out food and energy prices, was in line pointing to a possible easing of pricing pressures.

— Fred Imbert

Slightly hotter than expected inflation data from December is unlikely to knock the Federal Reserve off course from cutting interest rates later this year, economist Paul McCulley said Thursday.

Even with the consumer price index showing that that inflation rose 3.4% from a year ago, McCulley contended that the Fed’s policy “pivot is unambiguously in.”

“The next move is a cut, and it’s going to be a series of cuts to take us back to neutral. That’s the theme the market is working on. I think it’s the right theme and the day’s data doesn’t change that really at all,” McCulley said during an interview on CNBC’s “Squawk on the Street.”

Nevertheless, stocks fell following the inflation news.

“It’s noisy in the data, it’s noisy in the market, but we’re fundamentally in a soft landing with a pivot already in rhetorically and we’re just waiting for it come in reality, timing, pace and magnitude,” McCulley added.

—Jeff Cox

Bitcoin miners gave back earlier gains as the price of the cryptocurrency retreated in volatile trading, after the Securities and Exchange Commission’s approval of the first U.S. spot bitcoin ETFs, which hit the market Thursday.

The two biggest mining stocks, Marathon Digital and Riot Platforms each lost more than 15%. Wall Street favorites Iris Energy and CleanSpark fell 9% and 7%, respectively. Investors were taking profits after the price of bitcoin briefly spiked to above $49,000 for the first time since December 2021. It has pulled back since to the $46,000 level.

Miners were some of the biggest gainers in the stock market in 2023. Marathon finished this year higher by almost 590%, while Riot rose more than 350%. CleanSpark and Iris Energy posted gains of more than 400%.  

— Tanaya Macheel

The Federal Aviation Administration said Thursday it has opened a probe on Boeing after a panel on the side of one of its Boeing 737 Max 9 planes blew off midflight on Saturday.

The investigation will dig into whether Boeing “failed to ensure completed products conformed to its approved design and were in a condition for safe operation in compliance with FAA regulations,” the FAA said.

Shares of Boeing slipped nearly 2% in midday trading.

— Leslie Josephs, Michelle Fox