Notable market news this past week (14-Apr-24)
Here is the Skeptivest roundup of the latest market headlines for the week
🇺🇸 The fight to regain the chip manufacturing lead amidst looming fears of an US AI-driven tech bubble
Goldman calls top on US AI tech boom & continues to shift focus to Energy & Japan: The firm’s asset management division told Bloomberg that they will be repurposing bumper profits from tech stocks and into energy companies seen as a hedge to inflation and Japanese shares which the company deems undervalued. The company believes that AI stock returns will diverge as the industry matures. S&P 500 oil and gas companies are up16% through 2024, while tech companies are up 11%.
...yet, US semiconductor re-shoring efforts continues: In a continued bid to protect national security interests and AI dominance, the Biden administration unveiled a package of $11.6b in federal grants and loans to help Taiwan SemiconductorManufacturing Company (TSMC) upgrade its manufacturing plans. TSMC announced that they will construct a third factory in Phoenix, adding to two facilities in the state that are expected to begin production in 2025 and 2028. Earlier InMarch, Intel was awarded $8.5 billion in grants.
☕️ Quick fire happenings to note
🌏 Global macro
- US Inflation data has comes in hot again: March Consumer Price Index (CPI) rose0.4% (vs. 0.3% expected), year-over-year at 3.5% (vs. 3.4% expected). Higher inflation has fully dampened Wall Street’s hopes for a summer Fed rate cut.
- Exports from China slumped 7.5% year-on-year last month: Despite a larger-than-expected year-on-year fall in export values, export volumes edged up to record highs - suggestingChinese exporters are continuing to slash prices to maintain sales amid weak domestic demand, bolstering the overcapacity narrative US and EU critics use to justify trade protectionism against China.
- Japan inflation expectations continue: Rising inflation expectations in Japan are raising the possibility of another interest rate hike this year. A Bank ofJapan survey conducted in early March found that 83.3% of households expect prices to rise in the coming year, up from 79.3% three months prior. In March, the BOJ ended its eight-year policy of negative interest rates, signalling a shift towards tighter monetary controls.
- The global VC funding winter continues: S&P Global market intelligence reported Global venture capital funding dipped in Q1 2024, with the total deal value falling slightly (2.37%) to $71.57 billion compared to the same period in 2023
🏦 Individual stocks/companies
- Rumour mill: Google to buy Hubspot?: Alphabet (Google’s parent company) is considering a potential acquisition of HubSpot, a customer relationship management (CRM) company valued at $35 billion. This move, if pursued, would be a massive deal in the tech sector currently facing increased antitrust investigation
- Keep your seatbelts fastened: Boeing faces fresh safety concerns: Whistle-blower engineer Sam Salehpour reported potential manufacturing flaws in 787 and 777 models to US regulators. Salehpour alleges Boeing retaliated against him for raising the safety issues. Boeing shares are down 20.4% year to date.
- SEC goes after Uniswap: Uniswap labs, the biggest decentralised trading platform on Ethereum, is under fire from the US SEC for potentially operating as an unregistered security exchange and broker dealer. This clash underpins the ongoing debate on whether crypto tokens are considered securities.
🇸🇬 Singapore related
- Far East Shopping Centre's $908 million sale to a Chinese billionaire collapsed: Singapore's Urban Redevelopment Authority (URA) rejected the redevelopment plans as it did not fulfil the authority’s criteria to enhance and rejuvenate the area.
- Monetary Policy unchanged: Singapore's central bank opted to maintain its current monetary policy for the fourth consecutive time (gradual appreciation of SGD) to combat inflation. The Monetary Authority of Singapore(MAS) believes this approach will ensure price stability in the medium term.
