Trade overview: current reports, trends, indices, stock prices, bonds, foreign exchange and commodities and analyst recommendations
08:51
This morning (Tuesday) in Asia, the main indexes are trading in a positive trend. The Nikkei rose 0.6%, the Hang Seng added 0.1%, the Shanghai Stock Exchange rose 0.5% and the Kospi jumped 2.4%.
Futures in the US are trading this morning in a mixed trend.
Last night (Monday) on Wall Street, the trading day closed with falling rates. The Nasdaq fell 0.6%, the S&P 500 closed at a similar rate and the Dow Jones shed 0.5%.
The chip stocks gathered interest last night in trading:
Nvidia It fell by about 2.5% after it was reported in Reuters that the Chinese regulator responsible for market regulations announced that it had opened an investigation against the chip maker, on suspicion of violating the law on competition and antitrust issues in the country. “In recent days, due to a suspected violation of China’s monopoly law by Nvidia and the restrictive conditions surrounding the acquisition of Mellanox, the administration has launched an investigation into Nvidia in accordance with the law,” the State Director for Market Regulation in China published in a statement on CNBC.
According to the report, the chip manufacturer Nvidia is suspected of having violated the agreement to which it committed during the acquisition of the Israeli Mellanox, according to the conditions detailed by the regulator. At the time, when Nvidia made an offer to buy Mellanox for $6.9 billion, there were fears that China would block the deal. However, in 2020, Beijing approved the deal with a number of conditions, such as preventing off-the-books trading conditions, purchase restrictions, and more.
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On the other hand, the server manufacturer’s share Super Micro Computer stood out positively after the company received an extension from Nasdaq allowing the company to publish its annual report with which it had been delayed. The company will be able to publish its financial statements until the month of February in order to be able to maintain the listing of the stock in Nasdaq.
Alongside this, the chip manufacturer AMD Traded with price drops after analysts at Bank of America downgraded their recommendation on the stock to neutral from buy. In their estimation, the company is expected to lose market share in the industry and they are signaling their preference for the stock of Nvidia and other chip manufacturers.
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Electric vehicle stocks jumped sharply last night in trading on and off Wall Street Lucid , Xpng , Neo , I have a car also Rivian .
The reason is apparently the announcement by the Chinese Communist Party last night (Monday), led by President Xi Jinping, about “a more pro-active implementation of macro countries” as well as “a looser monetary policy”, in what marks a change of direction for the first time in 14 years. In other words – more incentives for companies and less government intervention.
On the other hand, the electric vehicle company Tesla of Elon Musk, a close associate of Trump, rose only 0.2% and did not participate in the celebration, as it is not expected to be positively affected by China’s incentives. Tesla, by the way, has already made its move when it registered a jump of no less than 116% in the last six months, mainly since the market “smelled” Trump’s victory in the elections. The company is now valued at more than $1.2 trillion. Pretty close to the record she recorded towards the end of 2021.
solaredge It stood out positively and rose about 12% after the solar energy company launched a new home battery as part of the ‘USA Edition’. The marketing of the battery will earn the company bonuses from the US government as part of the promotion of the inflation reduction law that encourages, among other things, the development of green technology that is produced from steel, iron or products produced locally.
In the American debt market, government bond yields are slightly down this morning (Tuesday). The 10-year yield is trading around 4.18%, and the two-year yield is at 4.11%.
In the macro sector, annual exports in China increased in November by 6.7%, significantly lower than the previous month’s figure (12.7%) and below early expectations. The drying data were also weak and amounted to a decrease of 3.9%, below the early forecasts.
Later today (Tuesday), the inflation data in Germany will be published.
In the commodity market, crude oil drops slightly this morning to $68 per barrel, and the price of a barrel of Brent oil drops to $71.2 per barrel.
The American investment company Citigroup predicts that the S&P 500 index will reach 6,500 points by the end of 2025 (an increase of 7% compared to today) in its base scenario. This forecast is supported by a combination of earnings growth, a stable macroeconomic background and sectoral expansion. However, the company warns that the path to this achievement will be accompanied by volatility, compared to the relatively stable performance in 2024.
Despite these strengths, the starting point of the extended valuations suggests that investors are already paying for expected future improvements. “This means that there is more risk in our bearish scenario than there is potential profit in our bullish scenario,” it said.
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