- Asian Shares Drop as Traders Weigh Trump Agenda: Markets Wrap
Most Asian shares fell as traders weighed the impact of president-elect Donald Trump’s likely agenda and the
stronger dollar on regional economies. Bloomberg’s gauge of the greenback climbed back toward a one-year
high. Shares in Taiwan and Hong Kong led declines even after US stocks advanced for a fifth day on Monday.
Treasury yield climbed in Asia as trading reopened following a US holiday Monday, helping to lure more funds
to the American currency. Bitcoin’s record-breaking rally took the digital asset past $89,000. - Dow jumps 300 points to close above 44,000 for the first time as Trump enthusiasm continues
The Dow Jones Industrial Average surged more than 300 points on Monday and closed at a record high above
44,000 for the first time, as the benchmark’s postelection rally pressed forward. The 30-stock Dow gained
304 points, or 0.69%, to 44,293.69. Both the S&P 500 and the Nasdaq Composite also closed at fresh records.
The S&P 500 added 0.1% to end the day at 6,001.35, while the Nasdaq Composite inched up 0.06% to
19,298.76. JPMorgan Chase and Goldman Sachs popped 1% and 2.2%, respectively, to lead the Dow
higher. Bank of America and Citigroup shares both closed up about 2%. The cohort has posted sharp gains
since Donald Trump’s election win last week, as investors hope his return to the White House could lead to
easier regulation of the banking sector. Elsewhere, meme stock favorite GameStop surged 10%. - Oil prices hold their ground after falling on China stimulus
Oil prices were little changed in early trading on Tuesday, awaiting further price direction from OPEC’s
monthly report after China’s stimulus plan and oversupply concerns took the wind out of markets in prior
sessions. Brent crude futures fell 1 cent to $71.82 a barrel, by 0158 GMT. U.S. West Texas Intermediate crude
futures were at $68.07 a barrel, up 3 cents. Both contracts had fallen by more than 5% over the previous two
trading sessions. China on Friday unveiled a 10 trillion yuan ($1.40 trillion) debt package to ease local
government financing strains, but analysts said it fell short of the amount of stimulus that would be needed
to boost growth. - Gold hovers near 1-month low ahead of U.S. data, Fed speakers
Gold ticked up on Tuesday but hovered near a one-month low, while investors awaited U.S. economic data
and comments from Federal Reserve officials for further clarity on the interest rate trajectory. Spot gold rose
0.2% at $2,624.17 per ounce by 0155 GMT, after hitting its lowest since Oct.10
on Monday. U.S. gold futures rose 0.5% to $2,630.10. The U.S. dollar held near a four-month high as investors
continued to pile into trades seen as benefiting from the incoming Donald Trump administration. A stronger
dollar makes bullion less attractive for other currency holders. - Trump tariff threat looms large on several Asian countries, not just China, says Goldman Sachs
Donald Trump’s victory in the U.S. elections has raised the specter of higher tariffs on China, but it may not
be the only Asian country that faces this predicament, according to Goldman Sachs. While the U.S. bilateral
trade deficit with China has decreased somewhat since the Trump administration, deficits with other Asian
exporters have risen significantly and may come under increased scrutiny, Andrew Tilton, Goldman’s chief
Asia-Pacific economist, said in a recent note. With Trump and some likely appointees focused on reducing
bilateral deficits, there is a risk that, in a sort of whack-a-mole manner–burgeoning bilateral deficits could
eventually prompt U.S. tariffs on other Asian economies, he said. A tariff is a tax on imported goods, but it
isn’t paid by the exporting country. So U.S. tariffs will be paid by companies looking to import products into
the country, raising their costs. Korea, Taiwan, and especially Vietnam have seen large trade gains versus the
U.S., Tilton observed. - China Nears Record $1 Trillion Trade Surplus as Trump Returns
China’s trade surplus is on track to hit a fresh record this year, increasingly leaving it on a collision course
with some of the world’s biggest economies by aggravating an imbalance in global commerce that risks
provoking President-elect Donald Trump. The difference between Chinese exports and imports is set to reach
almost $1 trillion if it continues to widen at the same pace as it has in the year to date, according to
Bloomberg calculations. The goods trade surplus soared to $785 billion in the first 10 months, according to
data released last week, the highest on record for that period and an increase of almost 16% from 2023. - China Plans to Slash Homebuying Taxes in Fiscal Stimulus
China is planning to cut taxes for home purchases as the government dials up fiscal support to revive a
moribund housing market, according to people familiar with the matter. Regulators are working on a
proposal that would allow mega cities including Shanghai and Beijing to cut the deed tax for buyers to as low
as 1% from a current level of as much as 3%, the people said, requesting not to be identified because the
matter is private. City governments have leeway to tweak the rules, the people added. - Treasury Yields Inch Higher With Focus on Trump Presidency
US Treasuries opened weaker as investors looked to rekindle the selloff spurred by Donald Trump’s
presidential victory last week. Yields on the 10-year benchmark bond rose as much as three basis points to
4.34% in Asian trading on Tuesday. Cash markets were closed on Monday for a US holiday. Better economic
data, perhaps a too-dovish Fed, and more policy details from the Trump administration could push Treasury
yields higher, a team of strategists at LPL Financial wrote in a Monday note. It will take negative economic
surprises for yields to fall meaningfully from current levels. - Europe could try to stop, or get around, damaging Trump tariffs
Donald Trump’s U.S. election win has left Europe scrabbling to work out how it will be able to contain, or
counter, probable tariffs on its exports to the U.S. Ahead of his election win last week, Trump had already
threatened to revive a trade war that began during his first term in office. Trump stated in his election
campaign that he would raise tariffs on Chinese goods by 60-100%, and would impose a blanket 10% to 20%
tariff on all U.S. imports. - Bitcoin nears $90,000 as crypto market exceeds pandemic-era peak
Bitcoin’s record-breaking rally took the digital asset past $89,000 and lifted the overall value of the crypto
market above its pandemic-era peak as traders bet on a boom under President-elect Donald Trump. The
largest token has jumped about 32% since the US election on Nov. 5 and hit an all-time high of $89,599 early
on Tuesday. The original cryptocurrency changed hands at $89,165 as of 9:25 a.m. in Singapore. - Tesla shares rose 9% Monday, extending gains for a fifth consecutive session, as Wedbush hiked its
price target to a Wall Street high
Wedbush analyst Daniel Ives raises the EV maker’s PT to $400 from $300 saying that a Trump White House
win will be a gamechanger for the autonomous and AI story for Tesla and Musk over the coming years.
Estimate the AI and autonomous opportunity is worth $1 trillion alone for Tesla, Ives wrote. Maintains
outperform rating. - AbbVie Inc. shares fell 12.6% after two mid-stage trials of its drug to treat schizophrenia failed to meet
their primary goal, a blow to the company’s $8.7 billion acquisition of Cerevel Therapeutics earlier this year
The medicine, emraclidine, didn’t show a statistically significant improvement on a scale used for measuring
the severity of symptoms of the mental illness, AbbVie said Monday. The company plans to analyze the data
to determine next steps. This outcome is a real dagger for AbbVie, Mizuho analyst Jared Holz wrote, calling it
another example of a major disappointment a buyer may face when acquiring a company prior to pivotal
data. The drugmaker pursued big M&A deals over the past few years to build out its pipeline in the wake of
fading sales of its biggest product, the anti-inflammatory drug Humira. Analysts had predicted emraclidine
would bring in $1.1 billion in annual sales in 2029, based on the benefits seen in early-stage testing. But the
new studies announced Monday found no statistical difference between the medicine and a placebo. Higher
doses didn’t appear to be more effective. For AbbVie investors, an $8.7B ‘mistake’ is likely to weigh on
sentiment for some time, wrote Piper Sandler analyst Christopher Raymond. AbbVie’s setback was viewed as
a victory for Bristol Myers Squibb Co., which in late September gained US approval for the first new type of
schizophrenia drug in seven decades. Bristol shares jumped 10.5%. The failure here will significantly bolster
Bristol’s lead in the evolving market, said Paul Matteis, an analyst at Stifel. - Monolithic Power shares slid 15% after Edgewater says the company’s market share in Nvidia’s
Blackwell architecture is at risk
Edgewater Research contended in a note to investors this morning that performance issues with Monolithic
Power’s voltage regulator module/Power Management IC appear likely to severely limit or eliminate
Monolithic’s allocation in Nvidia’s Blackwell, with Renesas seen taking over B200 and Infineon seen assuming
GB200 allocation as both are seen receiving rush orders in recent weeks. We hear NVDA will go through their
confirmed orders to MPWR for the next few quarters, but we hear NVDA has canceled half of MPWR’s
backlog, cutting all of their unconfirmed orders, the firm added. Deutsche Bank said it would be surprised if
Monolithic Power lost all of its share, saying the value of being the incumbent is high and the likelihood of
such severe performance issues is low. Should Edgewater’s sell-side report prove true and Monolithic did
lose all of its Nvidia business, this would put 15% of the company’s revenue at risk, the firm adds. - European Google rivals partner on search engine infrastructure to counter Big Tech
Ecosia and Qwant are partnering to build a European search index and reduce their dependence on U.S. Big
Tech firms. The companies agreed a joint venture, called the European Search Perspective, which they plan
to launch in France initially in the first quarter of 2025. Both Ecosia and Qwant will use the search index
themselves, but the tech will also be made available to other independent search engines and tech firms.
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