US Market Outlook: Key Economic Data and Tensions Impacting Futures; Google Stock Rises.

Economic Data Release and Market Reactions

On Friday at 21:30 Beijing time, the U.S. will release a series of economic data, with the core PCE price index for December and the preliminary annualized quarterly GDP for Q4 being the most anticipated. The inflation indicator favored by the Federal Reserve is expected to show an acceleration in price increases for December, while the final economic performance for 2025 is likely to be strong, laying a foundation for a more robust performance this year. If this is the case, both indicators will reinforce policymakers' increasingly cautious stance on interest rate cuts.

Key Economic Indicators

• Core PCE for December: Expected to rise 0.3% month-on-month and 2.9% year-on-year, both higher than previous values.
• Q4 GDP Growth: Anticipated to reach 3% year-on-year.

If the December PCE reading meets expectations, it will significantly exceed the Fed's 2% target, indicating a slowdown in inflation momentum after recent stabilization.

Market Performance

U.S. stock futures are down, with the Dow futures falling 0.13%, Nasdaq futures down 0.14%, and S&P 500 futures down 0.12%. Major tech stocks are mostly declining, with notable exceptions like $Google-A (GOOGL)$ and $Google-C (GOOG)$ rising over 1%.

In contrast, several Chinese concept stocks are down, including $Bilibili (BILI)$ dropping over 4% and $Ctrip (TCOM)$ and $Baidu (BIDU)$ down over 3%.

Nvidia's Investment in OpenAI

Nvidia is reportedly in deep negotiations to invest up to $30 billion in OpenAI as part of a new funding round, which could value OpenAI at $730 billion post-investment. This investment is separate from a previously announced $100 billion infrastructure partnership.

Google Launches Gemini 3.1 Pro

Google has released the Gemini 3.1 Pro model, which doubles its inference performance, significantly improving its capabilities in logic and coding tasks. This upgrade is expected to accelerate Google's AI ecosystem.

Intel's Struggles in Foundry Business

Intel's foundry business is facing challenges, with projected losses of $2.5 billion in Q4 2025 and no external customers. The company must secure orders from major clients like Apple and Nvidia by 2026-2027 to avoid strategic contraction.

AMD's Financial Strategy

AMD is providing guarantees for a $300 million chip loan to startup Crusoe, aiming to boost market share. This strategy, while potentially increasing sales, exposes AMD to greater risks amid slowing AI demand.

Tesla's New Cybertruck Pricing

Tesla has launched a new, lower-priced Cybertruck starting at $59,990, making it the cheapest version in the lineup. The price of the most expensive model, Cyberbeast, has also been reduced from $114,990 to $99,990.

Meta's Shift Towards AI

Meta Platforms has cut stock incentives for employees for the second consecutive year as CEO Mark Zuckerberg invests heavily in AI talent and infrastructure. The company anticipates capital expenditures could reach $130 billion by 2026.

Sanofi Faces Legal Challenges

Sanofi is being sued in Texas for allegedly bribing healthcare providers to promote its prescription drugs, leading to a pre-market drop of over 1%.

Conclusion

As the U.S. prepares for significant economic data releases, market reactions indicate a cautious sentiment among investors, particularly in the tech sector. Companies like Nvidia and Google are making strategic moves in AI, while traditional firms like Intel and AMD are navigating challenges in a rapidly evolving landscape.