“Given the lift off — which I totally missed — it’s going to be tough to break the markets down.” — Jeff Saut

1. Chinese Markets Closed for Lunar New Year — Chinese markets will remain closed for most of the week as Lunar New Year celebrations kick off for much of Asia. The PBOC pumped 1.13T yuan (roughly $165B) into domestic money markets last week via its routine operations as consumers prepared for shopping sprees and to hand out red packets filled with fresh notes to friends and relatives.
2. Iran Tests Another Ballistic Missile & White House Puts Iran ‘On Notice’ — Iran has conducted its first ballistic missile test since Donald Trump took over as President, in another apparent violation of a United Nations resolution. As a result, the UN will hold an urgent meeting today at the request of the U.S. President Trump was a sharp critic of the Iran nuclear deal during last year’s campaign and has suggested he may seek to renegotiate its terms. National Security Adviser Mike Flynn has officially put Iran “on notice” and warned of new U.S. sanctions following the country’s weekend ballistic missile test. The pronouncement marks a pivot away from the Obama administration’s policy of diplomatic engagement, which led to a 2015 multinational nuclear deal that has been denounced repeatedly by President Trump.
3. Insulin Makers Sued Over High Prices — three of the biggest makers of diabetes treatments, Sanofi (NYSE:SNY), Novo Nordisk (NYSE:NVO) and Eli Lilly (NYSE:LLY), were named in a proposed class action lawsuit by a group of patients alleging price-fixing. The suit accuses the companies of exploiting the U.S. drug pricing system that benefits them and pharmacy benefit managers, and claims they simultaneously hiked the price of insulin by over 150% during the past five years.
4. Amazon Plans First Air Cargo Hub — Looking to accommodate its growing fleet of planes, Amazon (NASDAQ:AMZN) plans to invest $1.5B to build a large air cargo hub in northern Kentucky, signaling an expansion into transporting, sorting and delivering its own packages. The move, which is expected to create more than 2,000 jobs, will lessen its dependence on traditional carriers, including UPS and FedEx (NYSE:FDX), both of whose largest hubs are nearby.
5. Federal Open Market Committee (FOMC) Stands Pat in Feb — the FOMC announced no change in the Feb meeting and reiterated plans to raise rates gradually and leave the federal funds rate target range at 0.5 percent to 0.75 percent. Officials have penciled in three quarter-point rate hikes this year, according to the median quarterly estimate submitted by officials in December. Investors see the central bank taking its time, with a roughly 70 percent probability of a quarter-point hike by the June FOMC meeting.
6. Trump To Undo Dodd-Frank, Fiduciary Rule — removing some of the regulatory burdens on banks, President Trump plans to sign executive actions seeking a review of the 2010 Dodd-Frank law and a rollback of the so-called fiduciary rule – set to take effect in April. Trump is scheduled to issue the directives following a meeting of more than a dozen top corporate executives led by Blackstone (NYSE:BX) CEO Steve Schwarzman.

The week ahead — Economic data from Econoday.com: