Market Rotation, Vol Shift and This Morning's Top Earnings

• Equity futures are mostly higher, with Communication Services and IT leading the way, suggesting a rotation towards risk-on sectors.
• The US Dollar Index is aggressively re-rating to the downside, trading near September lows, while 10-year Treasury yields are inching higher.
• Health insurers like Humana, UnitedHealth, and CVS Health are experiencing significant declines (12-16%) after the Trump administration kept Medicare rates relatively flat, impacting their profitability and future guidance.
• RTX (Raytheon) reported strong 4Q earnings, beating EPS and revenue estimates, with a substantial backlog and positive guidance, driven by demand for F-135 engines and international defense spending.
• Geopolitical and trade developments include an EU-India trade accord and US tariffs on South Korea, indicating a reshaping global trade landscape and potential for increased volatility.

The market is experiencing mixed signals with futures mostly higher, driven by communication services and IT sectors. However, underlying currency and bond markets show potential volatility. Health insurers are under pressure due to lower Medicare payment rate increases and UnitedHealth's mixed earnings, while RTX (Raytheon) reported strong results driven by defense spending. Global trade dynamics are also shifting with new agreements and tariffs.