Tuesday morning brought a dose of caution to U.S. stock markets after Monday's positive close. Futures across major benchmark indices were trading lower as investors positioned themselves ahead of December's inflation data, which could influence the Federal Reserve's near-term policy path.

The mood was measured rather than panicked. Wall Street broadly expects the annual inflation rate to remain stable at 2.7% in December, with the monthly pace coming in at 0.3%. These are numbers that fall squarely in the "not great, not terrible" category—far from triggering broad-based market concerns but not exactly giving the Fed a green light to start cutting rates aggressively.

Meanwhile, the 10-year Treasury bond yielded 4.19%, and the two-year bond sat at 3.55%. The CME Group's FedWatch tool showed markets pricing in a 95% likelihood of the Federal Reserve leaving current interest rates unchanged in January. Translation: don't expect any surprises at the next Fed meeting.

Futures painted a picture of modest declines across the board:

The SPDR S&P 500 ETF Trust (SPY) and Invesco QQQ Trust ETF (QQQ), which track the S&P 500 index and Nasdaq 100 index respectively, were lower in premarket trading on Tuesday. The SPY was down 0.019% at $694.53, while the QQQ declined 0.12% to $626.40.

What's Moving in the Market

Alphabet Hits the $4 Trillion Club

Alphabet Inc. (GOOGL) was up 0.68% after reaching $4 trillion in market value amid the AI boom. The tech giant got an additional boost from news that Apple Inc. (AAPL) confirmed Google Gemini will give Siri a long-awaited makeover. It's a significant partnership that signals Apple's acknowledgment that its voice assistant needs some serious help, and Google's AI might be just the medicine.

The stock maintains a stronger price trend over the short, medium, and long term, though it carries a poor value ranking—which makes sense when you're talking about a company worth $4 trillion.

Xpeng Expands Despite Stock Decline

Xpeng Inc. ADR (XPEV) dropped 2.63% despite announcing it will establish independent, localized supply chain teams in Europe and ASEAN in 2026. The company plans to add supply-chain management to its existing overseas production, R&D, service, and data infrastructure. It's the kind of strategic expansion that sounds good on paper but apparently wasn't enough to excite investors Tuesday morning.

The stock maintains a stronger price trend over the short, medium, and long terms, suggesting the selloff might be more about broader market sentiment than company-specific concerns.

Five9 Partners with Google Cloud

Five9 Inc. (FIVN) rose 0.36% after expanding its partnership with Google Cloud for enterprise customer experience AI. It's another sign that AI partnerships are becoming the currency of the modern tech economy—everyone wants a piece of that Google AI magic.

The company maintains a weaker price trend over the short, medium, and long terms with a moderate value ranking, making the modest gain somewhat noteworthy.

JPMorgan Earnings on Deck

JPMorgan Chase & Co. (JPM) was 0.31% higher as analysts expect it to report fourth-quarter earnings before the opening bell. Wall Street is looking for earnings of $4.92 per share on revenue of $46.02 billion. As the largest U.S. bank by assets, JPMorgan's results often set the tone for the entire financial sector's earnings season.

The stock maintains a stronger price trend over the short, medium, and long terms with a moderate quality ranking, reflecting its status as a blue-chip financial institution.

Revvity Jumps on Preliminary Results

Revvity Inc. (RVTY) shares rose 4.92% after releasing preliminary earnings expectations on Monday. The company expects fourth quarter 2025 revenue of approximately $772 million, representing about 6% reported growth and 4% organic growth compared to the same period last year. When a company pre-announces results and the stock jumps nearly 5%, it's usually because those results exceeded expectations.

The stock maintains a stronger price trend over the short, medium, and long terms, with a poor value ranking—a pattern we're seeing repeatedly in this market where momentum often trumps traditional valuation metrics.

How Monday's Session Played Out

Consumer Staples led a largely positive Monday session, while Financials and Energy were the only two sectors to finish in the red. It was one of those days where defensive sectors showed relative strength, which can sometimes signal underlying investor caution.

What the Smart Money Is Saying

LPL Financial maintains a bullish outlook for 2026, anticipating a "continuation of an impressive streak of quarters with double-digit earnings growth." This optimism is fueled by a resilient U.S. economy, where third-quarter GDP grew over 4% annualized, and corporate margin expansion continues despite tariffs.

Technology and AI remain the primary engines of this growth. The firm notes that "AI investment… isn't slowing down," with the "Magnificent Seven" expected to drive over 60% of S&P 500 earnings growth in the fourth quarter. That's a remarkable concentration of growth in just seven companies, which raises both opportunities and risks.

However, LPL believes the market rally could broaden, favoring cyclical value stocks like industrials that may benefit from the "One Big Beautiful Bill Act" fiscal stimulus. It's an interesting thesis: while tech has led the charge, there might be room for traditional economy stocks to catch up.

Looking ahead, LPL views 2026 as a year defined by policy—fiscal, regulatory, and monetary—which they expect to support corporate profits. While acknowledging potential volatility, they conclude that "mid-teens appreciation in stocks this year is possible if AI adoption accelerates and delivers strong productivity gains." That's a pretty optimistic call, suggesting another strong year for equities if the AI narrative continues delivering.

Economic Calendar Ahead

Tuesday brings a packed schedule of economic data that investors will be monitoring closely. December's NFIB optimism index data will be released by 6:00 a.m., followed by December's headline and core U.S. CPI data at 8:30 a.m.—the main event for the day. October's U.S. new home sales data follows at 10:00 a.m. ET.

On the Federal Reserve speaking circuit, St. Louis Fed President Alberto Musalem will speak at 10:00 a.m., December's U.S. budget deficit data drops at 2:00 p.m., and Richmond Fed President Tom Barkin will speak at 4:00 p.m. ET. It's always worth paying attention when Fed officials talk, especially in the lead-up to policy meetings.

Commodities, Crypto, and Global Markets

Crude oil futures were trading lower in the early New York session by 2.19% to hover around $60.62 per barrel. Energy markets have been volatile lately, caught between concerns about global demand and ongoing geopolitical tensions.

Gold Spot US Dollar fell 0.22% to hover around $4,586.67 per ounce. Its last record high stood at $4,630.47 per ounce, showing that even after a slight pullback, the precious metal remains near historic levels. The U.S. Dollar Index spot was 0.07% higher at the 98.9330 level.

Meanwhile, Bitcoin (BTC) was trading 1.57% higher at $92,154.63 per coin, showing some resilience after recent volatility in crypto markets.

Asian markets closed mixed on Tuesday, as India's Nifty 50 and China's CSI 300 indices fell. Meanwhile, Australia's ASX 200, Japan's Nikkei 225, Hong Kong's Hang Seng, and South Korea's Kospi indices rose. European markets were mixed in early trade, reflecting the cautious global sentiment as investors await key U.S. inflation data.