Good morning. Happy Friday.
The Asian/Pacific markets were split. China, Hong Kong, South Korea and Thailand did well; India, Indonesia and the Philippines were weak. Europe, Africa and the Middle East are doing well. Denmark is up huge; Poland, France, Greece, South Africa, Finland, Hungary and the Czech Republic are up nicely too. Index futures in the States point to a down open for the cash market.
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The dollar is down. Oil and copper are up. Gold and silver are up. Bonds are unchanged. Bitcoin is up.
Stories/News from Seeking Alpha…
Making moves
The pace of interest rate cuts has been the focus for much of the world, but in Japan, things are going in the opposite direction. The BOJ just hiked its key policy rate to its highest level in 17 years, continuing its hawkish stance after exiting an era of unconventional policy. It’s important to note that rates in Japan are still comparatively low, in a range of “around 0.5%,” but there are plans to keep pushing up borrowing costs toward levels seen in other major economies.
Backdrop: Japan had been mired in decades of weak prices and economic stagnation, and even as inflation impacted the globe in the aftermath of the COVID pandemic, BOJ policymakers largely viewed local price pressures as imported from elsewhere. That changed in 2024 as solid wage growth looked more permanent and the central bank became more confident in a “virtuous economic cycle” that would stimulate consumption and keep inflation stable. Even after exiting NIRP and massive monetary stimulus, the BOJ still feels that it is a ways away from a neutral rate, or a level that is neither cooling nor overheating for the economy.
The latest developments come as President Trump makes an aggressive push toward a new global era of cheap money. Wide-ranging tariffs are also a concern for trading partners of the U.S., including Japan, which could threaten growth, prices and currencies. The yen (USD:JPY) has already experienced a rapid weakening in recent years, even topping the ¥160 level vs. the dollar that is seen as requiring intervention.
SA commentary: “Short-term risks are significant considering issues such as the weak yen with appreciation pressure and shaky politics, but Japan presents significant opportunities amid normalization and corporate reforms in the long-run,” writes SA analyst Michael Ngan. “Equities are relatively cheap compared with global peers, but not exceptionally. Moving to 2025, structural themes such as reforms and normalization pathways will be on the watch of global investors.”
What else is happening…
Trump at Davos: Interest rates, oil prices, banking and Big Tech.
UnitedHealth’s (UNH) Medicare head to succeed slain insurance chief.
Opioid crisis: Sacklers, Purdue Pharma agree to new $7.4B settlement.
Store closures hit post-pandemic high in 2024, likely to double this year.
CEO pay packages: See the latest for Jamie Dimon and Bob Iger.
Trump signs executive order to create crypto working group.
Nikola (NKLA) slides to all-time low amid bankruptcy speculation.
American Airlines (AAL) CEO: ‘Apology Tour’ to pay off at year-end.
Boeing (BA) ends 2024 with steep loss; 737 Max output cap to stay.
AI boom: Blackstone (BX) to buy power plant near Virginia data center hub.
Today’s Economic Calendar
09:45 AM PMI Composite Flash
10:00 AM Existing Home Sales
10:00 AM Consumer Sentiment
01:00 PM Baker Hughes Rig Count
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Good morning. Happy Thursday.
The Asian/Pacific markets were split. Japan, China, India, Singapore and the Philippines did well; Hong Kong, South Korea, Australia, Malaysia and Thailand were weak. Europe, Africa and the Middle East are mostly quiet and little changed. Norway, Austria and Sweden are up; South Africa, Hungary and the Netherlands are down. Index futures in the States point to a down open for the cash market.
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The dollar is up. Oil is up slightly; copper is down. Gold and silver are down. Bonds are down. Bitcoin is down.
Stories/News from Seeking Alpha…
A nice counter-trade
The latest gathering of the world’s political and business elite, plus the usual smattering of celebrities, is taking place this week at the Swiss Alpine resort of Davos. The annual meeting comes as geopolitics become heavily intertwined with the world economy, as well as the disruptive innovation that will need to be addressed by countries and corporations. Reflecting those dynamics, the latest theme of the World Economic Forum is “Collaboration for the Intelligent Age,” which describes the convergence of today’s transformative technologies.
Buzzwords: Artificial intelligence, or more specifically, “AI agents,” which can learn and take action by themselves, are being explored for their potential in industries like finance and healthcare. “Digital trust” is another biggie that is growing in importance in the era of chatbots and deepfakes. “Tariffs,” or the levies imposed on imported goods, are also coming up in many conversations due to growing global trends towards protectionism.
Over 50 heads of state and government are gathering at Davos 2025, though President Trump will be absent following his recent inauguration. Instead, he’ll address the World Economic Forum via video link today, in a closely watched address at 11 AM ET. It comes shortly after the unveiling of the $500B Stargate Project, an AI infrastructure partnership involving Oracle (ORCL), SoftBank (OTCPK:SFTBY) and OpenAI, that seeks to keep the U.S. at the forefront of AI innovation.
Highlights so far: “If [tariffs] are a little inflationary, but [they’re] good for national security, so be it. I mean, get over it,” said JPMorgan (JPM) CEO Jamie Dimon. “National security trumps a little bit more inflation.” Bank of America’s (BAC) Brian Moynihan also confirmed that the U.S. banking system would accept cryptocurrency payments someday once there is regulatory approval, but investing in crypto like bitcoin (BTC-USD) is “really a separate question.” Pessimism about Europe was present in many conversations as well, prompting BlackRock’s (BLK) Larry Fink to call investment in the region a counter-trade. “Always go against Davos and you’ll make a lot of money,” he declared.
What else is happening…
S&P 500 (SP500) hits new intraday high, but just misses record close.
Insurance stocks on watch as Hughes Fire spreads north of LA.
U.S. Army eyes new approach for augmented reality combat goggles.
CNN (WBD) laying off ‘hundreds,’ NBC News (CMCSA) cuts some jobs.
CRISPR Therapeutics (CRSP) pops after RFK Jr. discloses investment.
Saudi prince’s company interested in TikTok if Musk was involved in deal.
Samsung (OTCPK:SSNLF) Galaxy S25 series ushers in ‘era of mobile AI.’
U.S. refocus: Stellantis (STLA) to invest billions, ramp up manufacturing.
EU weighs bloc-wide EV subsidy program to support local carmakers.
China calls on state funds, insurers to invest more in the stock market.
Today’s Economic Calendar
08:30 AM Initial Jobless Claims
10:30 AM EIA Natural Gas Inventory
11:00 AM Kansas City Fed Mfg Survey
12:00 PM EIA Petroleum Inventories
04:30 PM Fed Balance Sheet
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Good morning. Happy Wednesday.
The Asian/Pacific markets leaned to the upside. Japan, South Korea, Taiwan, Indonesia and Thailand did well; China and Hong Kong were weak. Europe, Africa and the Middle East are mostly up. Denmark, Poland, France, Germany, Switzerland, Hungary and Sweden are leading; Portugal and Israel are down. Index futures in the States point to a moderate gap up open for the cash market.
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The dollar is down. Oil and copper are down. Gold is up; silver is down. Bonds are up. Bitcoin is down.
Stories/News from Seeking Alpha…
Stargate Project
America First is coming to the world of artificial intelligence. In one of his first actions in the Oval Office, President Trump revoked the “Safe, Secure, and Trustworthy Development and Use of AI” executive order that had been put in place by the Biden administration. It’s part of a broader view that overregulation will stymie innovation and the development of future technologies, which are set to power the U.S. economy and give it a competitive advantage on the world stage.
That’s not all: Trump unveiled an artificial intelligence-focused initiative called Stargate that will involve companies like Oracle (ORCL), tech powerhouse SoftBank (OTCPK:SFTBY) and ChatGPT creator OpenAI. The joint venture will invest an initial $100B of private capital (and up to $500B over the next four years) to fund AI infrastructure. The project aims to support the “re-industrialization of the United States,” including 100,000 jobs, as well as providing strategic capabilities to “protect the national security of America and its allies.”
“We want to keep it in this country,” Trump announced, adding he would help with other emergency declarations to get more AI infrastructure off the ground. That’ll include boosting electricity production to fuel the growth of AI, or dedicated generation plants for some of the new projects. The first “colossal data centers” are already under construction in Abilene, Texas, which will be helping medical patients via comparative health records and diagnostics.
“It isn’t a foregone conclusion [that the U.S. will keep its lead],” Alphabet (GOOGL) CIO Ruth Porat said on the sidelines of the World Economic Forum in Davos. “We’re probably a year plus ahead in models. The West is ahead in chips. I think China is on par and may even be a bit ahead on what’s called diffusion of basic capabilities.”
What it means for markets: Well, the artificial intelligence trade is back. Nvidia (NVDA) leapfrogged Apple (AAPL) to become the largest U.S. company by market cap again, while Stargate founding member Oracle (ORCL) ended the session on Tuesday up 7%. The party also extended to others exposed to the industry, including NuScale Power (SMR) +17%, Vistra (VST) +8% and NRG Energy (NRG) +7%, which are seen as benefiting from AI data center demand, as well as other popular AI players, like SoundHound AI (SOUN) +21%, BigBear.ai (BBAI) +12% and Super Micro Computer (SMCI) +5%.
What else is happening…
Key takeaways from Netflix (NFLX) Q4 earnings as stock surges.
Meta (META) eyes Oakley smart glasses and other new wearables.
Space stocks soar on upbeat sentiment, Trump sets sights on Mars.
Shark Tank’s Kevin O’Leary still interested in $20B TikTok bid.
Nancy Pelosi sells Apple (AAPL), loads up on these tech shares.
David Einhorn: We reached the ‘Fartcoin’ stage of the market cycle.
Rare winter storm sweeps Gulf Coast and brings historic snowfall.
Trump says he’s thinking of imposing 10% tariffs on China next month.
Europe ready to defend its interests if levies are imposed – EU official.
Top Seeking Alpha Quant picks in technology ahead of Q4 earnings.
Today’s Economic Calendar
07:00 AM MBA Mortgage Applications
10:00 AM Atlanta Fed’s Business Inflation Expectations
10:00 AM Leading Indicators
01:00 PM Results of $13B, 20-Year Bond Auction
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Good morning. Happy Tuesday. Hope you had a good weekend.
The Asian/Pacific markets leaned to the upside. Hong Kong, Australia, Malaysia and Thailand did well while India was weak. Europe, Africa and the Middle East lean to the downside. Denmark is doing well, but Norway, Hungary, Spain, Italy, Portugal and Austria are down. Index futures in the States point to a moderate gap up open for the cash market.
————— Free Online Course: Mini Masterclass in Trading —————
The dollar is down. Oil and copper are down. Gold is down; silver is up. Bonds are up. Bitcoin is unchanged since Friday’s Wall Street close.
Stories/News from Seeking Alpha…
Day 1
“The Golden Age of America begins right now,” President Trump promised in his inaugural address on Monday, stating the U.S. would be the “envy of every nation” and will “not be taken advantage of any longer.” Other themes previously touted on the campaign trail were referenced as well, like “drill, baby, drill,” becoming a “manufacturing nation once again,” and “establishing an External Revenue Service to collect all tariffs.” Also don’t forget the dozens of executive actions that were passed on Trump’s first day in office.
On the move: Any immediate reactions were largely muted with markets closed for MLK Day, but crypto was a big winner after Trump unveiled a new memecoin over the holiday weekend. Bitcoin (BTC-USD) notched a new all-time high of $109,340, before falling back as Trump skipped over any pro-crypto directives for Day 1. Meanwhile, stock futures advance in overnight trading following the best weekly performance for Wall Street since the post-election rally in November 2024.
The inauguration also put a fresh spotlight on currencies and forex. The Mexican peso slid against the greenback, while the Canadian dollar fell to a five-year low amid news that 25% tariffs on Mexico and Canada could be imposed as soon as Feb. 1. The euro slipped as well, with Trump issuing fresh tariff threats if the EU doesn’t “buy our oil and gas,” though the possibility of universal tariffs was ruled out as the U.S. is “not ready for that yet.”
Sector watch: Executive actions were on the radar over their impacts on sectors ranging from tech to the auto industry. The U.S. withdrew from the Paris climate accord (again), leasing and permitting for wind energy projects were halted, electric vehicle mandates were revoked, and illegal immigration was declared a national emergency. What about TikTok? Trump is delaying the enforcement of a ban on the popular app by 75 days and suggested that the U.S. government should be a half-owner in the business.
What else is happening…
Chicago Fed’s Goolsbee isn’t concerned economy may be too hot.
Belgium probes Apple’s (AAPL) alleged use of ‘blood’ minerals.
EV bust: Canoo (GOEV) files for bankruptcy, ends operations.
Union workers at Costco (COST) vote in favor of strike.
This iconic Las Vegas Strip resort is getting renovated.
Amazon (AMZN) halts drone deliveries after training crashes.
Bulls vs. Bears: Intel (INTC) revisited amid buyout rumors.
Artificial intelligence is in the spotlight at Davos 2025.
PepsiCo (PEP) sued for giving a favored retailer better pricing.
Houthis will end attacks on Western ships in Red Sea.
Today’s Economic Calendar
11:00 AM Treasury Buyback Announcement (Preliminary)
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