A look at the coming day at the American and global markets by Mike Dolan
While he maintained a persistent, albeit uncertain, threat of new rates, US President Donald Trump quickly shifted his attention to technology and artificial intelligence this week, which is about to publish the glowing sector, which is about to publish its last win round.
On Tuesday, Trump announced an investment by the private sector of a maximum of $ 500 billion to finance infrastructure for artificial intelligence, with the aim of surpassing rival countries in the field of business -critical technology.
The newly sworn president said that Chatgpt maker OpenAi, Softbank (Tyo 🙂 and Oracle (NYSE 🙂 A joint venture plans called Stargate, which he believes will build data centers and create more than 100,000 jobs in the United States.
The shares of Softbank (OTC 🙂 Reden by more than 10% on the market in Tokyo, while Oracle outside a few hours rose by 9% prior to the ring of Wednesday.
Now that the technology is full again, streaming giant Netflix (Nasdaq 🙂 was bursting 14% higher in the premarket trade on Wednesday after the last profit update revealed a record number of 18.9 million new subscribers during the holidays and plans for price increases.
The renewed focus on technology is because this year the Nasdaq has been performing marginally worse than the wider, where even Apple (Nasdaq 🙂 on Tuesday was under a cloud, despite the strong profits on the Wall Street sharing index. Due to the withdrawal of Apple, AI-Chip Lieveling Nvidia (Nasdaq 🙂 was able to recapture first place as America’s most valuable company.
Now that a number of large industrial names were at the top of the company agenda on Wednesday, and the first 10% of the S&P500 companies pointed to a total annual profit growth of almost 11% during the past quarter, the stock futures before the opening rose considerably.
The S&P500 closed above 6,000 points for the first time this year on Tuesday – less than 1% compared to record highs.
Despite the AI tilt, Trump continued to rattle with the tariff label from one day to the next-without necessarily giving a lot of extra clarity about where or when they would come.
Trump promised to meet the “very, very bad” European Union with rates and said that his government also discussed a 10% penal tax on Chinese import, blaming the trade in fentanyl from China to the US via Mexico and Canada.
However, the currency fluctuations around the threats seemed to have calmed down, with traders assuming a wait -and -see attitude and assumed that some movement would only take place after the countries in question had responded to Trump’s most important concerns.
The euro fell to its lowest level in two weeks, with the euro reaching the best level of the year so far, even when officers of the European Central Bank, who spoke in Davos, supported more interest letings this year.
Although the exchange rate fluctuations seemed great this week, the implicit currency dratility meters have actually decreased. The three -month dollars/yen ‘Vol’ fell to the lowest level on Wednesday since July, with the youngest interest rise from the Bank of Japan now appearing ingrained. Equivalent Euro-Vol-Maatstaven have been the lowest since November, and even the British pounds have returned to their lowest level since July. Lows of two weeks.
European shares also managed to ward Trump’s trading threats, with the Stoxx600 index reaching a record high on Wednesday. Addidas also helped a new record and the sportswear brand rose by 6%after the latest results.
The increase of almost 6% in the reference sharing indexes from the euro zone this year is twice as large as that of the S&P500 in dollars – whereby the latest global fund manager of the Bank of America claims that the allocations to European shares this month the The second largest allocation in a quarter of century were.
However, Chinese shares were less enthusiastic about their return to the tariff fire line and fell by around 1%on Wednesday, where the Yuan also dropped.
Despite the telephone conversation prior to the inauguration between Trump and Chinese President Xi Jinping last week, Trump seems to have enough courage to publicly resume the trade war he started during his first term.
Back on the fixed -income markets, the nervous start of the new year seems to have calmed considerably.
A combination of lower oil prices – partly as a result of Trump’s plans to increase domestic oil drilling – and the lack of immediate rate increases has contributed to the interest on government bonds being back at the level of around the turn of the year.
After a considerable relief by the American inflation figures last week, Canada underlined the optimism on consumer prices on Tuesday with an unexpected large decrease in monthly prices, so that the annual inflation last month remained below the 2%objective of the Bank of Canada.
Elsewhere, the recently agitated British government bonds also performed better this week, because news about a large decrease in recruitments in Great Britain and the robust auction demand to the bonds compensated for the higher government loans and brought back the returns to the level of the beginning of this year.
Important developments that should give more direction to the American markets later on Tuesday:
* Canada inflation of producer prices in December
* American business profits: Halliburton (NYSE :), Procter & Gamble (NYSE :), Johnson & Johnson (NYSE :), Discover Financial, Kids morgan (NYSE :), Steel dynamics (Nasdaq :), Abbott Laboratories (NYSE :), travelers (nyse :), amphenol (nyse :), ge destructive, Connectivity (NYSE :), Textron (NYSE :), Teledyne
* World Economic Forum in Davos, including Christine Lagarde, president of the European Central Bank, Joachim Nagel, president of the Bundesbank, Francois Villeroy de Galhau, chief of the Bank of France, Klaas Knot, the boss of the Dutch Central Bank and Valdis Dombrovskis, Commissioner of the European Union
* The German Chancellor Olaf Scholz meets French President Emmanuel Macron in Paris
* The US Department of Finance sells $ 13 billion to twenty -year bonds
(By Mike Dolan, editors by William Maclean; mike.dolan@thomsonreuters.com)
