- Stocks Fall Ahead of US Jobs, China Yields Rise: Markets Wrap
Asian equities declined in a sign of caution ahead of US jobs data that will help shape the outlook for interest
rates. MSCI’s Asia benchmark dropped for a third session as shares in most markets dropped. Contracts for
the S&P 500 were little changed after the US stock market was closed Thursday to observe a national day of
mourning for former President Jimmy Carter. - Oil set for third straight weekly gain on winter fuel demand
Oil prices rose in early Asian trade and were on track for a third straight week of gains with icy conditions in
parts of the United States and Europe driving up fuel demand for heating. Brent crude futures climbed 24
cents, or 0.3%, to $77.16 a barrel at 0138 GMT. U.S. West Texas Intermediate crude futures gained 26 cents,
or 0.4%, to $74.18. Over the three weeks ending Jan. 10, Brent has advanced 5.9% while WTI has jumped
6.9%. - Gold prices on track for weekly gain; U.S. data on tap
Gold prices hovered near a four-week high on Friday, poised for their best week since mid-November, as
investors awaited U.S. jobs data to gauge how aggressively the Federal Reserve might cut interest rates this
year. Spot gold edged 0.1% higher to $2,672.64 per ounce, as of 0309 GMT. Bullion has gained more than 1%
so far this week. U.S. gold futures rose 0.2% to $2,696.30. Investors will closely watch the key government
payrolls report scheduled for release at 8:30 a.m. ET. According to a Reuters survey, non-farm payrolls are
expected to have increased by 160,000 in December, following a jump of 227,000 in November. - China’s central bank halts bond buying, possibly with eye on yuan
China’s central bank said on Friday it has suspended treasury bond purchases, triggering a jump in yields and
spurring speculation that the move was aimed at defending a falling currency. The
People’s Bank of China cited a shortage of bonds in the market as the reason it was halting the purchases,
which were part of its operations to ease monetary settings. But the move coincides with a brutal selloff in
other major bond markets around the world and suggests China’s central bank is trying to ensure yields at
home also rise in tandem, analysts say. Yields, which move inversely to bond prices, jumped following
the central bank’s announcement. China’s 30-year treasury yield climbed five basis points in early trade while
the 10-year yield rose four basis points. Both hit record lows recently. The yuan too rose slightly. - Chinese lenders have a massive challenge: They can’t lend enough
Chinese commercial banks have flocked to buying government bonds as Beijing’s stimulus push has failed to
spur consumers loan demand. Total new yuan loans in the 11 months through to November 2024 fell over
20% to 17.1 trillion yuan ($2.33 trillion) from a year ago, according to data released by the People’s Bank of
China. Chinese sovereign bonds have seen a strong rally since December, with yields plunging to all-time lows
this month. - Donald Trump can be sentenced Friday in hush money case, Supreme Court says in 5-4 ruling
President-elect Donald Trump can be sentenced Friday in his New York hush money case, the Supreme Court
said in a 5-4 ruling. The high court on Thursday rejected Trump’s emergency request to delay the proceeding,
setting the stage for him to be sentenced just days before he is inaugurated on January 20 for a second term.
Four conservative justices – Clarence Thomas, Samuel Alito, Neil Gorsuch and Brett Kavanaugh – said they
would have granted Trump’s request. Chief Justice John Roberts and Justice Amy Coney Barrett joined the
court’s three liberals to side against Trump. Judge Juan Merchan, the New York judge who oversaw Trump’s
trial, had ordered sentencing in the case for Friday morning but has signaled that Trump will face neither
penalties nor prison time. The sentencing hearing is scheduled for Friday at 9:30 a.m. Trump will appear
virtually, according to a person familiar with the plans, joining the proceedings from Mar-a-Lago.
In a brief, one-paragraph statement, the court said that some of Trump’s concerns could be handled “in the
ordinary course on appeal.” The court also reasoned that the burden sentencing would impose on Trump’s
responsibilities is “relatively insubstantial” in light of the trial court’s stated intent to impose no penalty. - ‘The sky is the limit’ on Damac investment in the U.S., Dubai property giant’s chief says
The sky’s the limit when it comes to Dubai property giant Damac’s investment in the United States, the
company’s chairman told CNBC on Thursday. Two days prior, President-elect Donald Trump announced a $20
billion foreign investment by the Emirati company to build new data centers across the U.S. — adding that its
founder and chairman Hussein Sajwani was pledging “at least” that amount. “The U.S. is a huge market, so
our $20 billion [investment] is a sizeable [amount of ] money when you look at it from our point of view. But,
to my knowledge, there is a large amount of money getting invested in data centers, and some numbers are
talking about $500 billion and more,” said Sajwani, who is a longtime friend and business partner of Trump.
He pointed to Microsoft’s recent announcement on investing $80 billion into American data centers in 2025.
Asked by CNBC’s Dan Murphy if he would eventually invest more in the U.S., Sajwani replied: “Well I mean,
the sky is the limit, we can invest more, as much as the market takes, then the limitation is not on.”
He added, “we can use initially our own financial resources, but then [in the] second phase we can use [a]
third party’s money, if our platform can grow to the next level.” - Ford CEO says China operations earned $600 million in 2024
Ford Motor’s operations in China earned roughly $600 million last year despite challenging market
conditions, CEO Jim Farley said Thursday night. “I’m happy to say that Ford makes money in China, and I’m
very proud of that, because not many [automakers] can say that,” Farley said following a vehicle reveal for
the Detroit Auto Show. Farley said those earnings included the export of vehicles such as the Lincoln Nautilus,
which is exclusively produced in China for other markets such as the U.S. China has been an increasingly
challenging market for automakers, especially western legacy companies such as Ford and General Motors.
Ford does not report earnings by region, but Farley has previously touted the company’s evolving “asset
light” strategy in China. - Microsoft contributes $1 million to Trump’s inauguration fund
Microsoft said Thursday that it’s contributing $1 million to President-elect Donald Trump’s inauguration fund.
The software maker is now more closely aligned with its highly valued peers in the technology
industry. Google said earlier Thursday that it’s donating $1 million to the Trump fund, and Meta offered
the same amount in December. Amazon was reportedly looking to make a similar contribution.
OpenAI CEO Sam Altman said in December that he would contribute $1 million individually,
and Axios reported last week that Apple CEO Tim Cook will do the same. Elon Musk, Tesla’s CEO and the
world’s richest person, has been advising Trump as he prepares to return to the White House following the
inauguration later this month. Microsoft also contributed $500,000 to the first inauguration fund for Trump’s
first term and gave the same amount to President Joe Biden’s fund, a Microsoft spokesperson told CNBC. - Nvidia criticizes reported Biden plan for AI chip export curbs
Nvidia (NASDAQ:NVDA) on Thursday criticized a reported plan by the Joe Biden administration to impose
new restrictions on AI chip exports, saying that the outgoing U.S. leader should not “preempt incoming
President Trump” by enacting a last-minute policy. “We would encourage President Biden to not preempt
incoming President Trump by enacting a policy that will only harm the U.S. economy, set America back, and
play into the hands of U.S. adversaries,” Nvidia Vice President Ned Finkle said in an emailed statement.
The U.S. Commerce Department and the White House did not immediately respond to Reuters’ requests for
comment outside regular business hours. Reuters reported exclusive details last month on the Commerce
Department’s plan for approving global AI chip exports while also preventing bad actors from accessing them.
A key aim of the restrictions is to keep AI from supercharging China’s military capabilities. Bloomberg News
reported on Thursday that new export regulations could be announced soon, adding that a group of U.S.
adversaries would effectively get blocked from importing these chips, while the vast majority of the world
would face limits on the total computing power that can go to one country. Nvidia’s Finkle said the reported
policy was disguised as an “anti-China move” and warned that the extreme country cap will affect computers
around the world and push the world to alternative technologies. - Tesla launches redesigned Model Y in China, seeking to fend off rivals
Tesla launched a new version of the Model Y, its best-selling car, in China on Friday, hoping that a redesigned
exterior and upgraded features inside will help it regain market share taken by rivals such as Xiaomi
(OTC:XIACF). The new Model Y, the world’s most popular electric vehicle, is priced from 263,500 yuan
($35,900)，5.4% more expensive than the previous version in China, Tesla (NASDAQ:TSLA)’s second-largest
market, the U.S. automaker said on its Weibo (NASDAQ:WB) social media account. Deliveries in China are set
to begin in March, subject to regulatory approval. Details about Tesla’s plans for the revamped version in
other markets were not immediately available. The latest Model Y sports a new light bar that stretches across
the front end, similar to Tesla’s Cybertruck, while the tailight is also a full-width light bar. Other upgraded
features include seats that can be heated or ventilated for comfort in all weather conditions as well as a
touchscreen for second-row passengers. The long-range variant now has a driving range of 719 kilometres
per charge, up from 688 km. Tesla first launched the Model Y in 2020 and it became the world’s best-selling
car in 2023. The ageing model lost some sales momentum last year, hurt by competition from local rivals in
China, while in other markets demand for electric vehicles has weakened. Tesla was the largest maker of
battery electric cars in in China in 2020 but Chinese EV rivals have increasingly made inroads, winning over
customers with snazzy smart car features. - TSMC December sales surge 58% as AI demand remains strong
TSMC (NYSE:TSM) clocked a sharp increase in its sales for December as the world’s biggest contract
chipmaker continued to see robust demand from the fast-growing artificial intelligence industry.
Sales rose 57.8% year-on-year to T$278.16 billion ($8.44 billion), TSMC said in a statement on Friday. The
pace of growth also picked up sharply from the prior month. The figure brought TSMC’s fourth-quarter
revenue to T$868.46 billion, up substantially from the T$625.53 seen in the prior year. The strong sales set a
positive tone for chip demand going into 2025, as TSMC continued to benefit from heightened capital
expenditure on data centers and other AI-related infrastructure. This trend has largely offset weakness in
chip demand from consumer electronics, which TSMC warned is unlikely to improve in the near-term.
The chipmaker is a key part of the global chip supply chain, and manufactures chips for several major
technology companies. AI darling NVIDIA Corporation (NASDAQ:NVDA) is TSMC’s biggest customer, and has
been a key source of AI-fueled demand over the past two years. TSMC will report its fourth-quarter earnings
next week. - Kinder Morgan shuts two Los Angeles fuel pipelines due to power outages
Pipeline operator Kinder Morgan Inc (NYSE:KMI) said that two of its fuel pipelines in Los Angeles have been
shut since Jan. 8 due to power outages, as the most destructive wildfires in the city’s history continued to
burn uncontained on Thursday. The company said the 515-mile (828.8 km) SFPP West pipeline and 566-mile
CALNEV pipelines are not directly impacted by the fires, and it expects them to resume service once power
has been restored. “Yikes! That’s how product gets to Phoenix, Las Vegas and San Diego,” a West Coast fuel
trader said on hearing of the shutdown. SFPP West transports fuel from the Los Angeles Basin to Colton, and
Imperial, California, and to Phoenix, Arizona. CALNEV moves gasoline, diesel and jet fuel from Colton,
California to terminals in Barstow, California, and Las Vegas, Nevada, according to Kinder Morgan’s website.
“They should be able to catch up, but it depends on the inventory situations,” the trader said, requesting
anonymity as they are not authorized to speak publicly about another company’s operations.
California refineries had about 5.2 million barrels of CARB gasoline in stockpiles as of Jan. 3, according to data
from the California Energy Commission. So far there have been no reports of refinery outages in the state
due to the wildfires. More than 300,000 customers were without power in California as of Thursday,
according to figures from utility Southern California Edison.
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