- Asia Stocks Fall on Korea Crisis, Weak China Data: Markets Wrap
Asian shares dropped, as South Korea’s political turmoil deepened and data showed a slow demand recovery
in China. Oil rose after the Syrian government collapsed. A regional equities gauge declined 0.3%, after
Korea’s benchmark fell as much as 2.3%. Hong Kong and mainland Chinese stocks also slid as consumer
inflation eased in the world’s No. 2 economy. Japanese benchmarks edged higher after growth data was
revised up. The dollar gained slightly while Treasuries were steady. The euro was under pressure partly as a
risk-off trade following the fall of the Syrian regime. - S&P 500 rises to a record close Friday, posts third straight winning week
The S&P 500 and Nasdaq Composite rose to fresh records on Friday after November jobs data came in
slightly better than expected, but not so hot as to deter the Federal Reserve from cutting rates again later
this month. The broad market S&P 500 climbed 0.25% to 6,090.27. Tech-heavy Nasdaq advanced 0.81% to
19,859.77, bolstered by gains in Tesla, Meta Platforms and Amazon. Both indexes touched new all-time highs
during the session and closed at records. The Dow Jones Industrial Average slipped 123.19 points, or 0.28%,
to close at 44,642.52. The S&P 500 and Nasdaq went on to their third straight positive week as well, rising
0.96% and 3.34%, respectively. The Dow slipped 0.6% during the period. The November labor report,
released Friday morning, revealed that nonfarm payrolls increased by 227,000 last month, above the Dow
Jones estimate of 214,000 and marking a huge hike from October’s upwardly revised gain of 36,000. The
unemployment rate nudged up to 4.2%, as expected. - Oil prices mixed as rising Mideast tensions offset demand concerns
Oil prices were mixed in early Asia trade on Monday as concerns over weak Chinese demand were offset by
rising tensions in the Middle East following the rebel overthrow of Syrian President Bashar al-Assad. Brent
crude futures fell by 1 cent to $71.11 per barrel by 1117 GMT. U.S. West Texas Intermediate crude
futures rose by 1 cent to $67.21 per barrel. Brent lost more than 2.5% last week, while WTI saw a drop of
1.2% as analysts projected a supply surplus next year on weak demand despite an OPEC+ decision to delay
output hikes and extend deep production cuts to the end of 2026. - Gold firms as investors await U.S. inflation data for Fed clues
Gold prices gained on Monday as investors awaited U.S. inflation data due this week for clues on the Federal
Reserve’s next monetary policy moves. Spot gold was up 0.5% at $2,644.91 per ounce, as of 0238 GMT.
Bullion fell nearly 1% last week. U.S. gold futures added 0.3% to $2,666.80. Gold is supported by headlines
that China’s central bank is back to purchasing gold in November which could be “good news for gold bulls”
in knowing that they have the People’s Bank of China (PBOC) behind their back to underpin some strength for
bullion prices, IG market strategist Yeap Jun Rong said. Top consumer China resumed buying gold for its
reserves in November after a six-month pause. - Payrolls increased 227,000 in November, more than expected; unemployment rate at 4.2%
Nonfarm payrolls rose by 227,000 for the month, compared with an upwardly revised 36,000 in October and
the Dow Jones consensus estimate for 214,000. The unemployment rate edged higher to 4.2%, as expected.
Traders accelerated their bets on an interest rate cut this month following the payrolls release. Job gains
were focused in health care (54,000), leisure and hospitality (53,000), and government (33,000). - China’s Consumer Inflation Weakens Ahead of Key Economic Meeting
China’s consumer inflation unexpectedly decelerated in November while factory deflation eased, painting a
mixed picture of the effects of recent stimulus efforts on the economy ahead of key policy meetings this
week. The consumer price index rose a less-than-forecast 0.2% from a year earlier, the lowest since June,
while core inflation picked up slightly. Factory deflation extended into a 26th straight month, though the
producer price index recorded a slower drop of 2.5% compared to October. - Japan’s Economy Shows More Resilience as BOJ Mulls Hike Timing
Japan’s economy grew at a faster pace than initially estimated, indicating more strength in the recovery as
the central bank parses data ahead of a policy decision later this month. Japan’s gross domestic product grew
at an annualized pace of 1.2% in the three months through September from the previous quarter, the
Cabinet Office said Monday. The result beat a preliminary estimate of 0.9%, largely on better net exports,
capital expenditure and inventory figures. Economists had forecast an upward revision to 1.0%. The stronger
growth data support the Bank of Japan’s view that the economy will continue to expand moderately. The
decline in both net exports and capital expenditure shrank, while inventory growth was also revised up. - Trump Tells NBC He Has No Plan to Remove Powell as Fed Chair
President-elect Donald Trump said he has no plans to replace Federal Reserve Chair Jerome Powell once he
returns to the White House, saying “I don’t see it.” Powell, whose term as Fed chair expires in May 2026, told
reporters last month that he wouldn’t step aside early if Trump asked for his resignation. I think if I told him
to, he would, Trump said Sunday on NBC’s Meet the Press, his first network television interview since winning
the US election in November. “But if I asked him to, he probably wouldn’t.” Powell made it clear within days
of the election that he’s ready to defend the Fed’s independence from political pressure, insisting the
incoming president doesn’t have the power to fire him or other senior Fed leaders. Trump has previously said
he should have a say in monetary policy and the setting of interest rates. I think I have the right to say, ‘I
think you should go up or down a little bit.’ I don’t think I should be allowed to order it, Trump said in a
Bloomberg News interview in October. “But I think I have the right to put in comments as to whether or not
interest rates should go up or down.” - South Korea Set for More Turmoil After Yoon Escapes Impeachment
South Korean President Yoon Suk Yeol managed to avoid impeachment over the weekend by just a handful of
votes. But pressure for him to step down is only intensifying. With mounting public anger in Seoul and Yoon’s
approval rating nearing single digits, his allies huddled on Sunday to find a way for him to quietly step aside.
They want the president to go away without needing to vote for his impeachment, a move that could upset
supporters and hurt the party in a subsequent election. That search for a creative solution prompted Han
Dong-hoon, the leader of Yoon’s People Power Party, to declare on Sunday that Prime Minister Han Duck-soo
would manage the nation’s affairs from now on, including its security alliance with the US. - Turmoil in Paris and Berlin Overshadows ECB Policy in Frankfurt
European Central Bank officials long used to navigating troubling times for the world now face a headache far
closer to home: a leadership crisis at the heart of the euro zone itself. Policymakers will set interest rates in
Frankfurt this week for the first time since governments in Paris and Berlin both collapsed over budget talks
for next year, with the ongoing turmoil largely obscuring their view of the two biggest economies in the
currency region they manage. While Europe’s political vacuum won’t derail a likely interest-rate cut on
Thursday, it does cast doubt over the value of quarterly forecasts being currently compiled, and compounds
the uncertainty confronting officials just as they await the incoming presidency of Donald Trump and his
threatened trade tariffs. - OPEC+ oil output delay a ‘reality check’ as group eyes demand, U.S. outlook, Saudi energy min says
Speaking to CNBC’s Dan Murphy on Friday, Saudi Energy Minister Abdulaziz bin Salman said OPEC+ had to
undertake a reality check and reconcile supply-demand signals with market sentiment. The minister said
OPEC+ had not necessarily lost confidence in global crude appetite or in recoveries in China, but admitted
that “what is not helpful was the fact that some [OPEC+] countries were not attending to their commitments
properly.” OPEC+ has increasingly cracked down on member compliance with individual quotas, which has in
the past included the likes of Iraq, Kazakhstan and Russia. - Bitcoin falls below $100,000 after reaching the milestone level for the first time
The price of bitcoin soared past the long-awaited $100,000 benchmark for the first time ever late Wednesday
evening. By Thursday afternoon, its price eased below the milestone. The move came after the S&P 500 and
Nasdaq Composite registered new closing records, in the same day that President-elect Donald Trump
announced his pick for SEC chair and that Fed Chair Jerome Powell likened bitcoin to gold. Bitcoin is now up
more than 133% in 2024 and 42% since the election. - Assad’s Fall After 24-Year Rule Creates Power Vacuum in Middle East
As Bashar Al-Assad fled to Moscow, the looters started raiding the presidential palace and people took the
streets of Damascus to celebrate his demise. The Syrian president had tried to hang on until the bitter end,
still desperately sending an SOS to anyone who would listen, including Donald Trump. The despot had run out
of road. The world is still grasping the speed of events in recent days, and the collapse of a ruling dynasty that
laid waste to the country during a catastrophic civil war. But the implications are also quickly sinking in, and
not least the prospect of more upheaval and violence as groups tussle for control. - Shares of Meta rose 2.4% after the US Court of Appeals in Washington refused to block a law requiring
TikTok’s China-based owner to sell the app or face a US ban
Social media and search companies have been in focus as tech investors have eyed the next step in TikTok’s
battle to keep its multi-billion-dollar-generating app operating in the US. An outcome weakening TikTok
offers upside for Meta and Alphabet, along with smaller companies like Pinterest and Snap, while threatening
Oracle, which counts TikTok as a big customer. Now we’ll have to wait and see what the incoming
administration does to either execute the decision or find an alternative to keep TikTok a viable concern,
Matt Stucky, chief equity portfolio manager at Northwestern Mutual Wealth Management, says. The
Supreme Court will probably agree to hear TikTok’s appeal given this case involves balancing two
fundamental US issues, free speech vs national security, TD Cowen’s Paul Gallant writes. The earlier 3-0
decision suggests the Supreme Court, if it takes the case, will uphold it as well. We note that the panel issuing
today’s ruling was 2-1 Republican, the same balance of power as in the Supreme Court, which is 6-3
Republican. Trump could still save TikTok, but the court has narrowed his path, raising the risk of an actual
ban. - Shares of Palantir Technologies and Booz Allen Hamilton rose 6.2% and 2.1% respectively after the two
companies announced a strategic partnership to increase U.S. Defense capabilities through technological
innovation
Combining Booz Allen’s mission support experience with Palantir’s latest learning AI and processing data
technology, brings an essential solution to the largest national security needs. Through increased
collaboration in modernizing information infrastructure, the ultimate goal is to foster mission planning and
interoperability improvements for U.S. forces and its allies. The ultimate objective is to produce field-ready
solutions combining secure collaboration as a must-have feature for modern warfare operations. The
partnership has already produced a prototype in just 45 days, and Booz Allen CEO Horacio Rozanski
emphasized the need to take a whole-of-nation approach to adversaries. Booz Allen’s strategic support will
complement Palantir’s advanced data integration tools and powerful defense solutions. At the same time,
Palantir CEO Alex Karp stressed the importance of AI-powered hardware in maintaining battlefield
superiority. The teamwork solidifies the decades-long bond between the two companies, which have in the
past helped fund U.S. government programs with their technology. - DocuSign shares soared 27.9% after the maker of electronic-signature software boosted its revenue
forecast for the full year. Analysts were positive about the early contract renewals
THIRD QUARTER RESULTS: Adjusted EPS 90c vs. 79c y/y, estimate 87c. Revenue $754.8 million, +7.8% y/y,
estimate $745.4 million. Subscription revenue $734.7 million, estimate $724.5 million. Billings $752.3 million,
+8.7% y/y, estimate $718.4 million. Adjusted gross margin 82.5% vs. 83% y/y, estimate 81.5%. Free cash flow
$210.7 million, estimate $172.9 million. FOURTH QUARTER FORECAST: Sees revenue $758 million to $762
million, estimate $755.5 million. Sees subscription revenue $741 million to $745 million, estimate $738
million. Sees billings $870 million to $880 million, estimate $848.8 million. 2025 YEAR FORECAST: Sees
revenue $2.96 billion to $2.96 billion, saw $2.94 billion to $2.95 billion, estimate $2.95 billion. Sees
subscription revenue $2.89 billion to $2.89 billion, saw $2.86 billion to $2.88 billion, estimate $2.87 billion.
Sees billings $3.06 billion to $3.07 billion, saw $2.99 billion to $3.03 billion, estimate $3.01 billion. JPMorgan
analyst Mark Murphy (underweight, PT $70): DocuSign results display mild saucer-shaped recovery with
revenue, billings growth upticking. Another positive is that early renewals are set to support an acceleration
in billings from a very depressed level. Piper Sandler analyst Rob Owens (neutral): DocuSign reported 3Q
results beat a conservative setup, with billings growth showing upside. While we are encouraged by the
acceleration, we believe it is still too early until newer products and solutions contribute meaningfully to the
model – and overall growth. - HPE shares rose 10.6% after the computer hardware and storage company reported fourth-quarter
revenue that beat the average analyst estimate. Citi upgrades the stock citing AI momentum
FOURTH QUARTER RESULTS: Net revenue $8.46 billion, +15% y/y, estimate $8.26 billion. Adjusted EPS 58c vs.
52c y/y, estimate 56c. Adjusted operating margin 11.1% vs. 9.7% y/y, estimate 10.8%. Free cash flow $1.50
billion, -35% y/y, estimate $1.09 billion. FIRST QUARTER FORECAST: Sees adjusted EPS 47c to 52c, estimate
48c. Citi analyst Asiya Merchant (raised to buy from neutral): Upgrade reflects recovery in core revenue and
AI momentum. Expect the company to benefit from improving demand in mainstream server and enterprise
networking, expanding enterprise AI opportunities and a narrowing valuation gap versus peers. Morgan
Stanley analyst Meta Marshall (overweight, PT $28): HPE beat revenue estimates largely due to AI servers.
“HPE’s AI server revenue came in at $1.5bn in FQ4, about in-line with buyside expectations, driven in part by
El Capitan revenue recognition”. Bloomberg Intelligence analyst Woo Jin Ho: Reported mixed 4Q segment
results, but that shouldn’t overshadow improving demand across its key business units. “Strength in hybrid
cloud, led by storage and AI private cloud, drove the upside to 4Q, while servers and storage were largely in
line”.
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