Inflation data, bank earnings, Saks files for bankruptcy and more in Morning Squawk

• Core CPI increased 0.2% month-over-month and 2.6% year-over-year, both below forecasts of 0.3% and 2.7%, with the cooler data likely insufficient to prompt Fed rate cuts at the upcoming meeting
• Saks Global filed for Chapter 11 bankruptcy and secured $1.75 billion in financing commitments, with former Neiman Marcus CEO Geoffroy van Raemdonck immediately taking over as CEO
• Meta is laying off approximately 10% of Reality Labs staff (over 1,000 employees) and shutting down multiple VR game studios to pivot resources toward artificial intelligence initiatives

Market Summary: Inflation Data, Bank Earnings, and Saks Bankruptcy

Key Economic Data:

Core inflation rose 0.2% month-over-month and 2.6% year-over-year in December, below economist expectations of 0.3% and 2.7% respectively. While positive for consumers, the cooler reading may reduce Federal Reserve pressure to cut interest rates at this month's policy meeting. The Producer Price Index is due at 8:30 AM ET today.

Banking Sector:

Bank of America and Wells Fargo exceeded Q4 earnings expectations, while Citigroup fell short on revenue forecasts. JPMorgan CEO Jamie Dimon indicated yesterday that all options, including potential exits from credit card businesses, are "on the table" in response to proposed rate cap legislation. Goldman Sachs and Morgan Stanley report earnings tomorrow.

Retail Crisis:

Saks Global filed for Chapter 11 bankruptcy overnight after exhausting cash reserves. The 159-year-old luxury retailer, which owns Neiman Marcus and Bergdorf Goodman, secured approximately $1.75 billion in financing commitments. Former Neiman Marcus CEO Geoffroy van Raemdonck immediately replaces Richard Baker, who served just two weeks as CEO.

Geopolitical Tensions:

President Trump suspended meetings with Iranian officials until the country ends its crackdown on anti-government protesters, promising "HELP IS ON ITS WAY." Oil and gas prices jumped over 2% Tuesday on the news before moderating Wednesday morning.

Tech Sector:

Meta is cutting approximately 1,000 jobs (10% of Reality Labs staff) and shuttering multiple VR studios as it pivots resources toward artificial intelligence. The company continues developing its Horizon Worlds platform while de-emphasizing metaverse initiatives.

Market Action:

Major indexes declined, coming off negative performance from the previous session. The Supreme Court may rule on Trump tariff legality as soon as today.