Good morning. Happy Friday.
The Asian/Pacific markets were mostly weak. Japan, China, Hong Kong, South Korea, India and Singapore posted stiff losses. Europe, Africa and the Middle East are mixed. Poland, Norway, Hungary and Austria are up; the UK, Switzerland, Spain and Sweden are down. Index futures in the States point to big down open for the stock market, thanks to the latest employment numbers.
————— VIDEO: Trading Themes from 2024 —————
The dollar is down. Oil and copper are up. Gold and silver are up. Bonds are down. Bitcoin is up.
Stories/News from Seeking Alpha…
Battling the blazes
The death toll from three days of intense wildfires in Los Angeles has climbed to 10 people, while many communities remain under red flag warnings amid concerns over air quality. The most damaging fires in Eaton and Palisades have destroyed over 10,000 structures in scenes that have been described as “apocalyptic” and reduced entire neighborhoods to ash. A tough road lies ahead for swaths of America’s most populated county, as well as its tens of thousands of residents who have been displaced by the infernos.
Quote: “The obvious question is, ‘Do you think it’s going to grow?'” Los Angeles County Sheriff Robert Luna said at a news briefing on Thursday evening. “I am praying it doesn’t but based on the devastation that is clear – it looks like a bomb, an atomic bomb – dropped in these areas. I don’t expect good news.”
Economic estimates continue to climb, with the latest numbers from the AccuWeather forecasting service pegging total damages at $135B-$150B. At those levels, the wildfire disaster could reach nearly 4% of the annual GDP of the state of California. There is no doubt that will further shake up the insurance and reinsurance industry, which has already been raising the cost of coverage for dangerous areas, and dropping or refusing to issue new policies.
What to watch: Significant double-digit increases in homeowners insurance are on tap in the coming years, which is likely to weigh on property values (or even across state lines). New rules in California also require insurers to underwrite a minimum percentage of policies in high-risk areas based on their market share, but that threatens to raise premiums. Funding for firefighting and emergency resources will need to be shored up as well, including the monitoring of utilities and prevention, putting additional strain on state and federal budgets. According to JPMorgan, the publicly traded insurers most exposed to California include Allstate (ALL), Chubb (CB) and Travelers (TRV).
What else is happening…
December non-farm payroll growth is expected to moderate further.
BlackRock (BLK) bows out of climate group amid antitrust concerns.
Free speech vs. national security: TikTok heads to the Supreme Court.
Elon Musk doubts DOGE can achieve $2T in budget cuts under Trump.
Mortgage rates continue to inch up, entry-level supply remains an issue.
Block (SQ) announces a ticker change to reflect broader range of services.
Intel (INTC) could name new, permanent CEO in ‘couple of months’ – Citi.
Pharma companies welcome new year with 583 drug price hikes so far.
Apollo (APO) eyes $9.5B stake in deal for 7-Eleven owner (OTCPK:SVNDY).
Macy’s (M) to close 66 stores across U.S. as part of turnaround strategy.
Today’s Economic Calendar
08:30 AM Employment Situation
10:00 AM Consumer Sentiment
01:00 PM Baker Hughes Rig Count
04:30 PM Fed Balance Sheet
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Good morning. Happy Wednesday.
The Asian/Pacific markets leaned to the downside. South Korea, Australia and Singapore did well while Japan, China, Hong Kong, Taiwan, Malaysia and the Philippines were weak. Europe, Africa and the Middle East are almost entirely down. Denmark is up, but the UK, Poland, France, South Africa, Finland, Spain, the Netherlands, Portugal, Israel and Austria are down. Index futures in the States point to down open for the stock market, but this is well off the overnight lows.
————— VIDEO: Trading Themes from 2024 —————
The dollar is up. Oil is up; copper is down. Gold and silver are up. Bonds are down. Bitcoin is down.
Stories/News from Seeking Alpha…
Changing the algorithms
Social media giant Meta Platforms (META) is making some big shifts as a company, with President-elect Donald Trump entering office for a second time. Key MMA figure Dana White, who was instrumental in the Trump election campaign, has been appointed to Meta’s board, while Republican policy executive Joel Kaplan has been tapped as head of global policy. Bigger yet are the content changes coming to Facebook, Instagram and Threads, which together have more than 3 billion users globally.
Quote: “What started as a movement to be more inclusive has increasingly been used to shut down opinions and shut out people with different ideas. And it’s gone too far,” CEO Mark Zuckerberg said in a video. “A lot has happened over the last several years. We’ve built a lot of complex systems to moderate content, but they make mistakes, and we’ve reached the point that there are just too many mistakes and too much censorship. It’s time to get back to our roots around free expression.”
Similar to X, Meta is getting rid of fact-checkers, which the company says have been too politically biased, and will replace them with Community Notes. The social media giant will also simplify its content policies and eliminate restrictions on topics like immigration and gender. Policy enforcement will change as well, such as refocusing screening filters to tackle illegal and high-severity violations, while lower violations will rely on user reporting before the company takes action. Possibly the biggest headline was that moderation and safety teams will be moved out of California, with U.S. content review to be based in Texas.
Repairing relationships: A lot has happened over the last several years. Meta (META) has gone from banning Trump on its platform in the aftermath of Jan. 6 to Zuckerberg flying down to Mar-a-Lago in November to meet with the President-elect. Zuckerberg is even donating $1M to Trump’s inaugural fund and blamed the Biden administration for increased censorship that has prompted a trend towards increased regulation around the world. Moment of reckoning? Business is business? What does it mean for the stock and the bottom line? (6 comments)
What else is happening…
BlackRock analysts: Go short-term, as longer duration bonds look ‘risky.’
Trump ramps up threats over Greenland, wants NATO to spend more.
California wildfires: Strong winds continue to fan flames, thousands flee.
Amazon (AMZN)-backed Anthropic eyes raising $2B in new funding.
Solar stocks suddenly hot as traders warm to AI-driven power demand.
Latest self-driving partnership: Aurora (AUR) and Nvidia (NVDA).
U.S. Steel (X) CEO seeks fresh look from Trump at Nippon deal.
JPMorgan Chase (JPM) said to plan an end to hybrid work policy.
Delta ditches Lyft (LYFT) for Uber (UBER) in frequent-flyer program.
AI threat? Getty (GETY) and Shutterstock (SSTK) ink merger in $3.7B deal.
Today’s Economic Calendar
07:00 AM MBA Mortgage Applications
08:15 AM ADP Jobs Report
08:30 AM Initial Jobless Claims
08:30 AM Fed’s Waller Speech
10:00 AM Wholesale Inventories (Preliminary)
10:30 AM EIA Petroleum Inventories
12:00 PM EIA Natural Gas Inventory
02:00 PM FOMC Minutes
03:00 PM Consumer Credit
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Good morning. Happy Tuesday.
The Asian/Pacific markets leaned to the upside. Japan, China, Taiwan and Thailand did well; Hong Kong and the Philippines were weak. Europe, Africa and the Middle East are mostly up. Poland, France, Germany, Greece, Finland, Switzerland, Hungary, Sweden and the Czech Republic are up; Denmark and South Africa are down. Index futures in the States point to a mixed open (S&P up, Nasdaq down).
————— VIDEO: My Favorite Setup —————
The dollar is down. Oil and copper are up. Gold and silver are up. Bonds are down. Bitcoin is down.
Stories/News from Seeking Alpha…
The big focus
Tariff threats
Nearly a decade in power, Canadian Prime Minister Justin Trudeau has announced his decision to resign after dropping in the polls and cracks became apparent in his minority government. The fateful moment came shortly after Trudeau tried to demote one of his closest cabinet allies, Finance Minister Chrystia Freeland, when she challenged his proposals for more spending. After quitting, Freeland penned a letter that accused Trudeau of “costly political gimmicks” and the need to keep “fiscal powder dry” given U.S. President-elect Donald Trump’s “threat of 25% tariffs.”
Thought bubble: The rising cost of living and inflation have propelled the economy to the top issue for many Canadian voters, who might have once considered climate change and progressive causes as paramount when there was more money in their pockets. Loose immigration policies have additionally upset many citizens, while top-heavy mandates and regulations have triggered significant backlash (remember the Freedom Convoys and frozen bank accounts?). Real-world problems like housing affordability and employment are also taking precedence over future issues like sustainability, helping trigger a return to “common sense” as federal debt levels pile up and productivity worsens.
All of this sentiment has helped fuel a right-wing shift across the globe against politicians who are seen as disconnected from the realities of the common man or woman. That outlook has also been emboldened by unbridled pluralism or wokeism that has been preached over a proud national identity. It could take months for things to be ironed out in Canada, given the time needed to find a new Liberal Party leader and other political dynamics, but it looks like the party will take a drubbing when a national election takes place (sometime between April and October 2025). Polls even suggest the opposition Conservatives, led by Pierre Poilievre, could win a supermajority in parliament.
What it means for markets: While a Conservative leadership would be pro-business and could roll back many restrictions on the world’s fourth-largest oil-producing nation, there are still many issues surrounding trade that will have to be ironed out. Tariffs on goods going into the U.S. would be a big problem for Canada, as most of its exports are destined for its southern neighbor. The S&P/TSX Composite closed lower on Monday and the loonie (CAD:USD) gave back gains against the U.S. dollar, as Trump declared that “the United States can no longer suffer the massive Trade Deficits and Subsidies that Canada needs to stay afloat” and the country should become the “51st State.”
What else is happening…
WSB survey results: The best AI stocks to watch in 2025.
Pentagon lists Tencent, Huawei as Chinese military companies.
Meta (META) adds UFC boss and Trump ally Dana White to its board.
FuboTV (FUBO) to merge with Disney’s (DIS) Hulu + Live TV unit.
U.S. Steel (X), Nippon sue Biden administration for blocking merger.
McDonald’s (MCD) hits pause on DEI goals as corporate winds shift.
Fed’s Cook: Markets at risk of ‘large declines’ due to elevated valuations.
Biden bans offshore drilling in Atlantic, Pacific before Trump takes office.
NATO official slams banks, pension funds that shun defense investments.
Louisiana DOH confirms first death in U.S. caused by bird flu.
CES 2025: Nvidia (NVDA) and AMD (AMD) vie for AI supremacy.
Today’s Economic Calendar
08:00 AM Fed’s Barkin Speech
08:30 AM International Trade in Goods and Services
10:00 AM ISM Service Index
10:00 AM Job Openings and Labor Turnover Survey
01:00 PM Results of $39B, 10-Year Note Auction
01:00 PM Results of $22B, 30-Year Bond Auction
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Good morning. Happy Monday. Hope you had a good weekend.
The Asian/Pacific markets leaned to the downside. South Korea and Taiwan did well; Japan, Hong Kong, India, Indonesia and Thailand did poorly. Europe, Africa and the Middle East are mostly up. France, Turkey, Germany, the UAE, South Africa, Spain, the Netherlands, Italy and Israel are leading; Denmark is weak. Index futures in the States point to a big gap up open for the cash market.
————— VIDEO: My Favorite Setup —————
The dollar is down. Oil and copper are up. Gold is down; silver is up. Bonds are mixed. Bitcoin is up.
Stories/News from Seeking Alpha…
The big focus
The world’s biggest annual tech expo, the Consumer Electronics Show, is kicking off this week in Las Vegas with more than 150K people in attendance. Artificial intelligence will be all over the event, ranging from hardware and software for business and personal use. Over 4,000 exhibitors are hoping that the technology displayed at the event will get noticed by investors, who are seeking improvements to productivity and hunting for big returns.
Next chapter: AI was all about innovation and the possibilities in 2023 and 2024, but things are moving fast in the latest growth cycle. The next chapter happening in 2025 will center around integration and optimization, which is what will be on display at this year’s CES. The next stage will be defined by real-world use cases that go beyond the AI hype, and can offset ballooning costs by delivering profits and productivity gains via mainstream adoption.
Speaking of a successful bottom line, Nvidia (NVDA) CEO Jensen Huang will kick off the festivities today with a keynote speech at 9:30 PM ET that’s expected to include GPU upgrades for the RTX 5000 series (based on the new Blackwell architecture). Prepare for Deep Learning Super Sampling, up to 32GB of GDDR7 video memory, and a gigantic power draw of 575 watts. It’s a big deal. Nvidia has been one of the hottest stocks on Wall Street, and even became the biggest U.S. company by market cap in 2024 as the symbol of the AI revolution.
Other new AI products: Samsung (OTCPK:SSNLF) is introducing Vision AI, which will help TVs become aware of their surroundings, as well as clickable content exploration, real-time subtitle translations, and turning idled screens into digital artwork. Expect more Seeking Alpha headlines this week as more innovative products are unveiled. Those are likely to include AI wearables and robotics, wellness technologies, chatbots, automated industrial processes, and leveraging AI into home energy management systems. Take the WSB survey.
What else is happening…
DOJ asks SCOTUS to block Trump’s bid to pause TikTok ban.
Canada’s Trudeau expected to quit as ruling party leader this week.
Surgeon General pushes for cancer warning labels for alcoholic drinks.
Microsoft (MSFT) plans to spend $80B in AI data centers in 2025.
Vivek Ramaswamy’s Strive files for bitcoin (BTC-USD) bond ETF.
Apple (AAPL) hopes to widen moat with 2025 product releases.
SA Asks: Which biotechs are most likely to be acquired near term?
New York City becomes first U.S. city to introduce congestion pricing.
United (UAL) to test Starlink WiFi next month, plans launch in spring.
Biden signs bill into law to boost Social Security payments for millions.
Short sellers’ mark-to-market losses shrank in 2024 despite Wall Street rally.
Today’s Economic Calendar
Auto Sales
09:15 AM Fed’s Cook: “Economic Outlook and Financial Stability”
09:45 AM PMI Composite Final
10:00 AM Factory Orders
01:00 PM Results of $58B, 3-Year Note Auction
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