Declines in Asia; The Hang Seng plunges about 2.5%

Trade review: current reports, trends, indices, stock prices, bonds, foreign exchange and commodities and analyst recommendations

08:47

This morning (Thursday), in Asia, the main indices are trading with lower values. The stock market in Japan is closed for a national holiday. The Hang Seng is down about 2.5%, the Shanghai Stock Exchange is down about 3% and the Kospi is trading around base levels.

In the USA, there was no trading last night (Wed) on the occasion of the new civil year, and this morning (Thursday) the futures contracts are trading slightly higher.

● What are the three most intriguing stocks in the new year?

in the bank UBS published an optimistic forecast for the renewable energy companies, despite the statement of the US President-elect, Donald Trump, that he will reduce subsidies to companies in the industry. Analysts at the investment bank stated that “the fears of damage to the sector are exaggerated” and that growth in the sector will likely continue. Looking ahead to 2025, they note that The easing of supply chains alongside new projects and a drop in bond yields will support the renewable energy companies.

The bank notes two “unrealistically cheap” European stocks, which are traded on Nasdaq from the renewable energy sector and have an upside potential of about 60%: a share of Oersted one of the world’s largest companies in the field of renewable energy that builds and operates wind farms, which UBS rates as a buy and a target price of $72.4, indicating an upside potential of approximately 60.4% from the closing price on 12.31.2024. In the Swiss bank, we also mentioned the share of the giant renewable energy company, RWE has a buy rating and a target price of $47, which is a potential upside of about 56.1% from the stock’s last closing price.

The 10-year US government bond yield is trading flat this morning at 4.57%. The yield that started the year below 4% ended the year with the biggest annual jump in three years. The 2-year yield is down slightly to 4.24%.

The price of Bitcoin is recovering this morning and is trading around $95,000, after retreating to $91,000 last week. Despite the decline recorded from the record of $106,000 per coin, crypto investors and industry executives predict that in the coming year, the coin will continue its positive momentum – and even double its value to $200,000.

For example, James Butterfill, head of the research department of the alternative assets company CoinShares, predicts that Bitcoin will receive a boost from a regulatory environment that will benefit it, and said that it is “not unreasonable” to expect the currency to be worth about 25% of the market value of gold in the US – when its value now stands at about 10% of it.

According to Butterfly, Bitcoin may stand at the low end of its valuation, $80,000, in the event that Donald Trump’s pro-crypto policy does not come to fruition, or is disappointing – leading to a significant correction in the market. In 2023, the company predicted that the price of Bitcoin would be $80,000 in 2024.

Alongside this, the British Standard Chartered Bank predicts that Bitcoin will double its value in 2025. The head of the digital assets department wrote last month that he expects Bitcoin to reach $200,000 by the end of 2025.

The bank noted that the total holdings of financial institutions in Bitcoin, through hedge funds bought mainly by the crypto company Micro-Strategy, reached 683 thousand Bitcoin coins since the beginning of the year; He predicts that in 2025 the company is expected to purchase a similar or greater amount than last year.

The bank also added that pension funds are expected to start including more bitcoin in their portfolios, through basket funds imitating bitcoin in 2025, thanks to the reforms expected to be led by the incoming Trump administration – which is expected to give a significant boost to the currency’s prices. “We will be even more bullish if we see adoption of Bitcoin by American retirement funds, global sovereign wealth funds, and a potential national reserve,” the bank said.

This morning (Thursday) the Caixin purchasing managers’ index in the manufacturing sector was published in China, which disappointed the early expectations and stood at 50.5 points.

Later today, the Purchasing Managers’ Index is expected to be published in the Eurozone, Germany and the USA.

The Swiss bank Lombard Odier published investment principles for the new year: “We anticipate a positive economic background in 2025 as well, with the continuation of global deflation and lower interest rates of the central banks. However, growth forecasts and interest rates are expected to differ between economies, which requires active management of the investment portfolios”. They also predict that “the elections in the US and Germany will be a catalyst for investments in infrastructure in developed countries. In emerging markets, investment trends remain strong, with an emphasis on expanding infrastructure within the framework of the cooperation of the BRICS countries (Brazil, Russia, India, China and South Africa). We focus on shares of companies that belong to the infrastructure value chain, from materials to infrastructure operators.”