- Asian Stocks Fall on Nvidia, Geopolitical Risks: Markets Wrap
Asian equities slipped, reflecting macroeconomic concerns and a muted mood on Wall Street triggered by
Nvidia Corp.’s lackluster revenue forecast. A gauge of Asian equities edged down 0.3%, with the region’s tech
heavyweights among the biggest drags. Contracts for US benchmarks dipped Thursday after Nvidia’s third
quarter revenue and earnings met estimates but fell short of the highest estimates for future revenue. Indian
benchmarks underperformed as US indictment of Gautam Adani over an alleged bribery plot led to a tumble
in the group’s shares. - S&P 500 closes little changed ahead of Nvidia’s big earnings report
The S&P 500 ended Wednesday flat, with Nvidia shares slipping nearly 1% ahead of the company’s highly
anticipated earnings report. Investors also assessed disappointing results from Target. The broad index closed
little changed at 5,917.11, while the Dow Jones Industrial Average gained 139.53 points, or 0.32%, to settle at
43,408.47. The Nasdaq Composite lost 0.11% to close at 18,966.14. - Oil prices firm as geopolitical tensions raise supply concerns
Oil prices edged higher on Thursday due to supply concerns triggered by escalating geopolitical tensions amid
the ongoing war between Russia and Ukraine. Brent crude futures for January rose 28 cents, or 0.4%, to
$73.09. U.S. West Texas Intermediate crude futures for January rose 28 cents, or 0.4%, at $69.03.
Ukraine fired a volley of British Storm Shadow cruise missiles into Russia on Wednesday, the latest new
Western weapon it has been permitted to use on Russian targets a day after it fired U.S. ATACMS missiles. - Gold gains for third consecutive day on escalating Russia-Ukraine tensions
Gold prices climbed for a third consecutive session to mark a one-week high on Wednesday, as investors
sought refuge in the safe-haven metal amid mounting geopolitical unease fuelled by escalating Russia
Ukraine tensions. Spot gold was up 0.6% at $2,647.43 per ounce, after hitting its highest level since Nov. 11
earlier in the session. U.S. gold futures settled 0.8% higher at $2,651.70. Geopolitical tensions intensified as
Russian President Vladimir Putin lowered the threshold for a nuclear strikes in response to a broader range of
conventional attacks. - UK inflation rises sharply to 2.3% in October, above expectations
U.K. inflation picked up sharply to a higher-than-expected 2.3% in October, data from the British Office for
National Statistics showed Wednesday. The hike marks a sharp increase from the 1.7% rise recorded in
September and exceeds the 2.2% forecast of economists polled by Reuters. The latest print once again brings
inflation above the Bank of England’s 2% target, potentially dampening the prospects of a final interest rate
cut this year. Core inflation, which excludes energy, food, alcohol and tobacco, came in at 3.3% for the
month, up slightly from 3.2% in September. The uptick was anticipated in part due to an increase in the
regulator-set energy price cap that took effect in October, which is expected to lead to higher energy price
inflation over the colder winter months.Price rises in the U.K.’s dominant services sector ticked up m
oderately to 5.0% last month from 4.9% in September, hitting its lowest rate in more than two years. Inflation
should drift gradually higher from here with rising energy bills, the impact of the Budget and global trade
frictions likely to keep the headline rate hovering above the Bank of England’s 2% target until well into 2025,
said Suren Thiru, economics director at the Institute of Chartered Accountants in England and Wales. - Japan’s Ishiba Set to Announce $140 Billion Stimulus Package
Japanese Prime Minister Shigeru Ishiba is set to unveil a $140 billion economic stimulus package to address a
range of challenges from inflation to wage growth, following his election promises to alleviate a cost-of-living
crunch. The package will add up to ¥21.9 trillion, according to public broadcaster NHK, a fraction larger than
last year’s array of measures. The package will include ¥13.9 trillion of spending from the general account,
NHK said. Together with private sector spending, the impact of the package overall is expected to be around
¥39 trillion, the report said. - European Central Banks warns of trade tension risks to euro zone financial stability
Rising global trade tensions present a risk to the euro area economy, the bloc’s central bank found in its
biannual Financial Stability Review out on Wednesday. A possible further strengthening of protectionist
tendencies across the world raise concerns about the potential adverse impact on global growth, inflation
and asset prices, the report said. The European Central Bank also said weak growth was now a bigger threat
than high inflation in the 20-nation euro zone. - Biden Administration Seeks to Cancel $4.6 Billion of Ukraine’s Debt
The Biden administration told Congress it plans to cancel $4.65 billion in debt owed by Ukraine, according to
a letter obtained by Bloomberg News, the latest in a series of moves meant to bolster support for Kyiv before
President-elect Donald Trump takes office. The White House will cancel half of a $9 billion loan delivered to
Ukraine as part of a $60 billion supplemental package approved in April. The loan idea was first floated by
Trump during the campaign and was a key tweak to the legislation made by House Republican leaders,
though the administration had always signaled a part of it would be forgiven. Canceling the debt, thereby
helping Ukraine prevail, is in the national interest of the United States and its EU, G7+, and NATO partners,
the State Department said in a letter to Congress dated Nov. 18. - What Trump’s return to the White House could mean for global bond yields
It is widely thought that Donald Trump’s pledge to introduce tax cuts and steep tariffs could boost economic
growth, but widen the fiscal deficit and refuel inflation. Trump’s return to the White House is seen as likely to
throw a wrench in the Federal Reserve’s rate-cutting cycle, potentially keeping an upward bias on yields.
Shannon Kirwin, associate director of fixed income ratings at Morningstar, said a significant chunk of
investors were hoping for European bonds to hold up fairly well in the coming years, while the euro is
expected to weaken. - U.S. closes embassy in Kyiv over potential ‘significant’ air attack as tensions with Russia soar
The U.S. closed its embassy in Kyiv on Wednesday, warning that it has received specific information of a
potential significant air attack amid soaring tensions with Russia. The U.S. Embassy said in a statement that it
was closing the building out of an abundance of caution and instructed embassy employees to shelter in
place. The U.S. Embassy recommends U.S. citizens be prepared to immediately shelter in the event an air
alert is announced, it added. - Adani Group shares nosedive after chairman Gautam Adani charged with fraud in New York
India’s Adani Group saw shares of its companies plunge Thursday after its billionaire chairman Gautam
Adani was indicted in a New York federal court over his alleged involvement in an extensive bribery and fraud
operation. The 62-year-old billionaire and the seven other defendants have been accused of paying over
$250 million in bribes to Indian government officials to secure solar energy contracts that could generate
more than $2 billion in profits. The Indian group’s flagship firm Adani Enterprises fell 23%, while the company
in the eye of the storm Adani Green Energy tanked 18.95%. Adani Energy fell 20%. Adani Power lost
14.48%, Adani Port’s share price dropped 20%, while the group’s retail arm Adani Wilmar shed 10%.
The benchmark NSE Nifty 50 Index slid 0.87%. - Alphabet’s VC arm backs little-known SAP rival Odoo, boosting valuation to $5.3 billion
Odoo, a Belgium-based company that develops open-source enterprise resource planning software, boosted
its valuation to 5 billion euros ($5.3 billion) in a secondary share round led by CapitalG and Sequoia. Fabien
Pinckaers, CEO and co-founder of Odoo, told CNBC his company didn’t have a need to raise any primary
capital as it is cash profitable and growing revenue at a rate of 50% year-over-year. Odoo had billings of 370
million euros last year and is on track to top 650 million of billings in 2025, after that, the company is hoping
to top the 1 billion-euro billings milestone by 2027. - Bitcoin climbs, reaching a new all-time high above $97,000
Bitcoin breached the $95,000 level for the first time Wednesday evening as investors continued pricing in a
second Donald Trump presidency. The price of the flagship cryptocurrency was last higher by more than 3%
at $97,646.68, according to Coin Metrics. Earlier, it rose as high as $97,788.00. Shares of MicroStrategy, a
bitcoin proxy, gained 3% in extended trading. Mining stocks rose as well, with Mara Holdings up 4%. Bitcoin
has been regularly hitting fresh records this month on hopes that Trump will usher in a golden age of crypto,
which would include more supportive regulation for the industry and a potential national strategic bitcoin
reserve or stockpile. It is widely expected to reach $100,000 this year and double by the end of 2025. - Nvidia Corp. delivered a revenue forecast that failed to meet the highest expectations, showing that its
dizzying AI-fueled growth run has its limits
Fiscal fourth-quarter sales will be about $37.5 billion, the company said in a statement Wednesday. Though
the average analyst estimate was $37.1 billion, according to data compiled by Bloomberg, projections ranged
as high as $41 billion. Chief Executive Officer Jensen Huang said that Nvidia’s new lineup, called Blackwell, is
now in full production. Demand for the products is expected to exceed demand for several quarters. Hopper,
the previous design, is still in demand, Huang added. AI is transforming every industry, company and country,
he said in the statement. Industrial robotics investments are surging with breakthroughs in physical AI, and
countries have awakened to the importance of developing their national AI and infrastructure. Nvidia’s
revenue rose 94% to $35.1 billion in the fiscal third quarter, which ended Oct. 27. Excluding certain items,
profit was 81 cents a share. Analysts had predicted sales of about $33.25 billion and earnings of 74 cents a
share. Nvidia looks to stay ahead of rivals by accelerating its pace of innovation. That includes a commitment
to updating its lineup annually. - Palo Alto Networks forecast revenue for the second quarter of $2.22 billion to $2.25 billion
FIRST QUARTER RESULTS: Adjusted EPS $1.56, estimate $1.48; Revenue $2.14 billion, +14% y/y, estimate
$2.12 billion; Product revenue $353.8 million, +3.7% y/y, estimate $344 million; Subscription and Support
revenue $1.79 billion, +16% y/y, estimate $1.78 billion; Deferred revenue $5.51 billion, +16% y/y, estimate
$5.59 billion; R&D expenses $480.4 million, +17% y/y, estimate $467.3 million. “Our Q1 results reinforced our
conviction in our differentiated platformization strategy”. “We see a growing market realization that
platformization is the game changer that will solve security and enable better AI outcomes”. Announced that
its board of directors has approved a two-for-one forward stock split of the company’s outstanding shares of
common stock. SECOND QUARTER FORECAST: Sees revenue $2.22 billion to $2.25 billion, estimate $2.23
billion (Bloomberg Consensus); Sees adjusted EPS $1.54 to $1.56, estimate $1.55; Sees 2q Next-Generation
Security ARR of $4.70 billion to $4.75 billion; Sees 2q remaining performance obligation of $12.9 billion to
$13.0 billion. 2025 YEAR FORECAST: Sees adjusted EPS $6.26 to $6.39, estimate $6.28; Sees revenue $9.12
billion to $9.17 billion, saw $9.10 billion to $9.15 billion, estimate $9.13 billion; Sees FY Next-Generation
Security ARR of $5.52 billion to $5.57 billion; Sees FY remaining performance obligation of $15.2 billion to
$15.3 billion. - Snowflake shares are soaring 15% in extended trading, after the software company reported third
quarter results that beat expectations and raised its full-year forecast for product revenue. It also agreed
to buy Datavolo
FOURTH QUARTER FORECAST: Sees product revenue $906 million to $911 million, estimate $890.7 million
(Bloomberg Consensus); Sees adjusted operating margin 4%. 2025 YEAR FORECAST: Sees product revenue
$3.43 billion, saw $3.36 billion, estimate $3.36 billion; Sees adjusted operating margin 4%, saw 3%. THIRD
QUARTER RESULTS: Revenue $942.1 million, +28% y/y, estimate $898.6 million; Product revenue $900.3
million, +29% y/y, estimate $856.6 million; Professional services and other revenue $41.8 million, +17% y/y,
estimate $40.8 million; Loss per share 98c vs. loss/shr 65c y/y; Net revenue retention rate 127% vs. 135% y/y,
estimate 124.2%; Current remaining performance obligation $5.7 billion, +54% y/y, estimate $5.22 billion;
Adjusted gross margin 73% vs. 75% y/y, estimate 71.8%; Adjusted diluted EPS 20c vs. 25c y/y, estimate 15c. - Chewy Inc. shares are up 4.3% on Wednesday, after BofA upgraded the online retailer of pet products
by two notches, to buy from underperform
Improving industry data should lead to accelerating topline trends and stronger earnings leverage for Chewy,
which we think the Street is likely underestimating, writes analyst Curtis Nagle. Adoption trends have steadily
improved since the start of ‘24 & pet spend appears to have bottomed.
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