- Equities Tread Water Before US CPI, Dollar Steady: Markets Wrap
Asian stocks saw choppy trading while the dollar steadied as traders awaited US inflation data for clues on
the path of Federal Reserve policy. The MSCI Asia Pacific Index trimmed most of its earlier advance, with
benchmarks in Hong Kong, South Korea and Japan up less than 0.5%. European equity futures edged higher
while contracts for US stocks were little changed. The dollar gauge consolidated after dropping 0.4% in the
previous session. The consumer price report comes at a crucial time for global markets, after a spate of solid
US economic data trimmed Fed rate cut expectations and triggered a debt selloff. Wednesday’s muted moves
are in contrast to risk-on gains in Asia in the previous session, when a report that Donald Trump’s incoming
team is considering gradual tariff hikes buoyed sentiment. - Dow rises more than 200 points on Tuesday after wholesale inflation report comes in light
The Dow Jones Industrial Average rose on Tuesday as traders weighed a lighter-than-expected producer price
index report. The 30-stock Dow gained 221.16 points, or 0.52%, to close at 42,518.28. The S&P 500 advanced
0.11% to 5,842.91, while the tech-heavy Nasdaq Composite slipped 0.23% to end at 19,044.39. - Oil little changed as falling U.S. stockpiles outweigh soft demand outlook
Oil prices were little changed on Wednesday, after falling the previous day, as a dip in U.S. crude stockpiles
and expectations of supply disruptions from sanctions on Russian tankers lent support amid forecasts for
lower global fuel demand. Brent crude futures were up 2 cents to $79.94 a barrel by 0205 GMT, after
dropping 1.4% in the previous session. U.S. West Texas Intermediate crude rose 12 cents, or 0.15%, to $77.62
a barrel after a 1.6% drop. Prices slipped on Tuesday after the U.S. Energy Information
Administration predicted oil will be under pressure over the next two years as supply should outpace
demand. - Gold edges up on soft inflation print, U.S. CPI in focus
Gold prices extended gains on Tuesday after U.S. inflation data came in slightly weaker than expected, giving
investors faint hope that the Federal Reserve would continue on its rate-easing path this year, sending the
dollar lower. Spot gold gained 0.3% to $2,668.91 per ounce. U.S. gold futures rose 0.1% to $2,682.20.
Data showed Producer Price Index (PPI) rose 3.3% on an annual basis in December, versus the 3.4% rise
expected by economists polled by Reuters. - US Producer Price Index dips below forecast, signaling potential inflation slowdown
The Producer Price Index (PPI), a key indicator of consumer price inflation, has registered a lower than
expected reading, according to recent data. The PPI, which measures the change in the price of goods sold by
manufacturers, came in at 0.2%. This figure falls short of the forecasted 0.4%, suggesting a potential
slowdown in inflation. Economists and market analysts closely monitor the PPI as it provides early signals of
inflationary trends, a critical factor for the Federal Reserve when setting monetary policy. Compared to the
previous reading, the PPI has remained unchanged. Last month’s PPI was also recorded at 0.4%, aligning with
the forecasted figure. This drop in PPI could be seen as negative or bearish for the US dollar, as it may
indicate a slowing economy. - China’s Central Bank Pumps Near-Historic Level of Cash Into Financial System
China’s central bank pumped a near-historic amount of short-term funds into its financial system on
Wednesday, dialing up liquidity support amid a cash squeeze with the new year holiday looming. The
People’s Bank of China injected a net 958.4 billion yuan ($131 billion) of cash via seven-day reverse
repurchase agreements in daily open market operations, the second highest on record in data compiled
by Bloomberg going back to 2004. The operation is aimed at offsetting the impact of the expiration of
medium-term lending, peak tax season and cash demand before Lunar New Year holidays, and to keep
banking system liquidity ample, the central bank said in a statement. The sizable liquidity support will
come as a relief for Chinese lenders after a cash crunch earlier this week pushed seven-day interbank
funding rates to the highest in more than a year. The PBOC’s increasing determination to defend the
under-pressure yuan has led to fears it may be restrained in providing sufficient liquidity support for the
economy, especially as it has decided to suspend government bond purchases in a bid to cool a bond
market frenzy. - Trump is fixated on Greenland — a vast Arctic island with massive resource potential
U.S. President-elect Donald Trump’s years-long bid to take control of the world’s largest island has kicked into
overdrive in recent weeks. Ahead of his inauguration on Jan. 20, Trump said U.S. ownership of the
autonomous Danish territory is an absolute necessity for purposes related to national security and freedom
throughout the world. “Overall, we can say that there is a huge potential for critical raw materials,” Jakob
Kløve Keiding, senior consultant at the Geological Survey of Denmark and Greenland, told CNBC via
telephone. - South Korea’s President Yoon Suk Yeol arrested as agencies probe his short-lived martial law decree
South Korean president Yoon Suk Yeol was arrested Wednesday by the country’s Corruption Investigation
Office for High Ranking officials, a first for a sitting South Korean leader. This was the second bid to arrest the
impeached president, following a failed attempt on Jan.3 when agents from South Korea’s Presidential
Security Service had blocked investigators from entering Yoon’s residence. Unlike the first attempt, “this
time, there were no individuals or security staff actively obstructing the execution, and there were no
significant physical clashes,” the CIO said. About 3,000 police officers were involved in the second attempt to
secure access to Yoon’s compound, news agency Yonhap said. South Korean media outlets also reported
Yoon in a pre-recorded video said that “the law of the country has collapsed,” and called the CIO’s
investigation “illegal.” Yoon said he would appear before the CIO to “prevent an unpleasant bloodshed,”
according to a Google translation of the reports in Korean. South Korean stocks had a muted reaction to the
news, with the blue-chip Kospi up 0.21% and the small-cap Kosdaq down 0.44%. The won weakened slightly
against the U.S. dollar, and was last trading at 1,459.75. Yield on 10-year benchmark South Korean bonds also
rose. - SEC sues Elon Musk, alleging failure to properly disclose Twitter ownership
The SEC filed a lawsuit against Elon Musk on Tuesday, alleging the billionaire committed securities fraud in
2022 by failing to disclose he had amassed an active stake in Twitter, a secrecy that allowed him to buy
shares at “artificially low prices.” Musk, who is also CEO of Tesla and SpaceX, purchased Twitter for $44
billion in late 2022 and changed the name to X the following year. Prior to the acquisition, he’d built up a
position in the company of greater than 5%, which would’ve required disclosing his holdings to the public
within 10 calendar days of reaching that threshold. According to the SEC’s civil complaint, filed in U.S. District
Court in Washington, D.C., Musk was more than 10 days late in reporting that material information, “allowing
him to underpay by at least $150 million for shares he purchased after his financial beneficial ownership
report was due.” Investors may have bid up the stock had they known about Musk’s purchases and interest
in the company. The SEC had been investigating whether Musk, or anyone else working with him, committed
securities fraud in 2022 around the Twitter disclosures. Musk said in a post on X last month that the SEC
issued a “settlement demand,” pressuring him to agree to a deal, including a fine within 48 hours or “face
charges on numerous counts” regarding the purchase of shares. - Meta announces 5% cuts in preparation for ‘intense year’ — read the internal memo
Meta is set to cut about 5% of its workforce, focusing on the company’s lowest-performing workers, CNBC
confirmed Tuesday. CEO Mark Zuckerberg informed employees about the decision to “move out low
performers faster” in a memo posted on the company’s internal Workplace forum on Tuesday. Zuckerberg
told employees 2025 will “be an intense year.” - Eli Lilly Stock Slumps on Lowered Sales Forecast
Eli Lilly (LLY) shares tumbled Tuesday after the drugmaker lowered its revenue forecast for the 2024 fiscal
year. The maker of weight-loss drugs Mounjaro and Zepbound said sales of the drugs grew slower than
expected in the fourth quarter, along with lower-than-expected inventory of the products. Eli Lilly said it
expects fourth-quarter revenue of roughly $13.5 billion, which would bring full-year revenue to $45 billion,
lower than the $45.4 billion to $46 billion range the company projected in its third-quarter report. Analysts
were looking for fourth-quarter revenue of $13.97 billion and full-year revenue of $45.48 billion, according to
estimates compiled by Visible Alpha. Heading into fiscal 2025, CEO David Ricks said the company expects
sales of weight-loss drugs will continue growing, and noted that it expects “to produce at least 60% more
salable doses” of the drugs over the first half of this year compared to 2024. The drugmaker said it
anticipates revenue between $58 billion to $61 billion in fiscal 2025, while analysts currently project $59.33
billion. Eli Lilly made the adjustment ahead of Ricks presenting at a healthcare conference Tuesday afternoon.
The company said it plans to report fourth-quarter earnings and outline its full forecast for fiscal 2025 on Feb.
Eli Lilly shares were down nearly 7% at $746 in intraday trading Tuesday following the news, though even
with Tuesday’s losses, they’ve gained over 17% in the last 12 months. - Tesla (TSLA) Stock Falls Amid Market Uptick
In the latest trading session, Tesla (TSLA) closed at $396.36, marking a -1.72% move from the previous day.
The stock trailed the S&P 500, which registered a daily gain of 0.12%. At the same time, the Dow added
0.52%, and the tech-heavy Nasdaq lost 0.23%. The electric car maker’s stock has dropped by 12.9% in the
past month, falling short of the Auto-Tires-Trucks sector’s loss of 10.27% and the S&P 500’s loss of 3.45%. The
investment community will be closely monitoring the performance of Tesla in its forthcoming earnings
report. On that day, Tesla is projected to report earnings of $0.76 per share, which would represent year
over-year growth of 7.04%. Meanwhile, our latest consensus estimate is calling for revenue of $27.77 billion,
up 10.35% from the prior-year quarter. Investors should also take note of any recent adjustments to analyst
estimates for Tesla. These recent revisions tend to reflect the evolving nature of short-term business trends.
As a result, we can interpret positive estimate revisions as a good sign for the company’s business outlook. - Plug Power (PLUG) Stock Sinks As Market Gains
In the latest trading session, Plug Power (PLUG) closed at $2.67, marking a -1.48% move from the previous
day. This change lagged the S&P 500’s 0.12% gain on the day. On the other hand, the Dow registered a gain
of 0.52%, and the technology-centric Nasdaq decreased by 0.23%. Shares of the alternative energy company
witnessed a gain of 10.61% over the previous month, beating the performance of the Industrial Products
sector with its loss of 5.97% and the S&P 500’s loss of 3.45%. Investors will be eagerly watching for the
performance of Plug Power in its upcoming earnings disclosure. The company’s upcoming EPS is projected at -$0.23, signifying a 78.5% increase compared to the same quarter of the previous year. Meanwhile, our latest
consensus estimate is calling for revenue of $272.41 million, up 22.62% from the prior-year quarter.
Investors should also note any recent changes to analyst estimates for Plug Power. Such recent modifications
usually signify the changing landscape of near-term business trends. Hence, positive alterations in estimates
signify analyst optimism regarding the company’s business and profitability. - Intel to spin off its venture capital arm
Chipmaker Intel Corp (INTC.O), opens new tab said on Tuesday that it will separate its venture capital and
investment arm, Intel Capital, into a standalone company, to focus on enhancing efficiency across the
business. Intel, which will remain an anchor investor, said the standalone operations are expected to begin in
the second half of 2025 and will have a new name. The existing Intel Capital team will move to the new
company. Intel Capital’s separation is a “win-win scenario as it provides the fund with access to new sources
of capital to expand its franchise while allowing both companies to continue benefiting from a productive
long-term strategic partnership,” said David Zinsner, Intel’s interim co-chief executive officer and CFO.
Established in 1991, Intel Capital has over $5 billion in assets under management and invests in companies
across four areas of the tech ecosystem: silicon, frontier, devices and cloud. Earlier today, identity security
startup Orchid Security said it had raised $36 million in an early-stage funding round led by Intel Capital and
Team8.
