- Asia Stocks Snap Three-Day Gain as Risk Rally Ebbs: Markets Wrap
Asian equities fell as a risk rally earlier in the week lost steam and Chinese economic data failed to boost
markets. The MSCI Asia Pacific Index snapped a three-day gain as investors parsed the impact of the data out
of China. The CSI 300 index of Chinese stocks fluctuated. Shares in South Korea and Japan fell. US equity
futures were little changed. The downward moves in Asia came as a global risk rally this week, fueled by
traders re-adjusting bets on Federal Reserve interest rate cuts, loses steam. China’s gross domestic product
bested economists’ median forecast on a bump from stimulus and provided a temporary boost to shares that
quickly fell back into negative territory. The data “signals that the stimulus measures of 2024 are having an
impact,” said Charu Chanana, chief investment strategist at Saxo Markets. “But that doesn’t rule out that
China markets still face structural headwinds as well as tariffs risks, and the response to those will be the
ultimate driver of long-term returns.” The numbers suggest Beijing’s policy pivot since late September helped
counter headwinds from a years-long property slump and entrenched deflation. It has vowed further
monetary easing and stronger public spending this year, as the economy braces for Donald Trump’s return to
the White House. Property investment contracted 10.6% in 2024, booking its worst year since records began
in 1987. - S&P 500 snaps three-day win streak, Apple drags Nasdaq to losing session
The S&P 500 slipped Thursday, ending a three-day winning streak, as big tech shares pulled back. The broad
market index slid 0.21% to 5,937.34. The tech-heavy Nasdaq Composite dropped 0.89% to 19,338.29. The
Dow Jones Industrial Average fell 68.42 points, or 0.16%, to 43,153.13. - Oil retreats after boost from US crude draw, Russia sanctions
Oil prices fell back on Thursday, a day after settling at multi-month highs on U.S. President Joe Biden’s latest
sanctions targeting Russia and a larger than forecast fall in U.S. crude stocks. Brent crude futures fell 74
cents, or 0.9%, to close at $81.29 per barrel, after rising 2.6% in the previous session to their highest since
July 26. U.S. West Texas Intermediate crude futures pulled back $1.36, or 1.7%, to settle at $78.68 a barrel,
after gaining 3.3% on Wednesday to their highest since July 19. The Biden administration on Wednesday
imposed hundreds of sanctions targeting Russia’s military industrial base and evasion schemes, after earlier
levying broader sanctions on Russian oil producers and tankers. Moscow’s top customers are now scouring
the globe for replacement barrels, while shipping rates have surged too. With Donald Trump being sworn in
for his second term on Monday, “the market is approaching the ‘wait-and-see’ phase and awaits the reaction
from the incoming U.S. administration on the issue” of sanctions, said Tamas Varga at oil broker PVM.
Pricier oil may also lead to clashes between Trump and the Organization of the Petroleum Exporting
Countries (OPEC), if the incoming president follows his previous playbook. During his first term, Trump
demanded the producer group rein in prices whenever Brent climbed to around $80. OPEC and its allies,
which collectively as OPEC+ have been curtailing output over the past two years, are likely to be cautious
about increasing supply despite the recent price rally, said Commodity Context founder Rory Johnston. - Gold climbs to over one-month high on weaker yields after U.S. data
Gold prices rose to a more-than-one-month high on Thursday after the latest U.S. economic data pressured
the Treasury yields further, following a soft core inflation reading this week that increased bets for a more
dovish Federal Reserve policy. Spot gold gained 0.8% to $2,718.00 per ounce, hitting its highest since Dec. 12.
U.S. gold futures rose 1.1% to $2,748.60. Initial claims for state unemployment benefits rose to a seasonally
adjusted 217,000 for the week ended Jan. 11, the Labor Department said on Thursday. A Reuters poll had
forecast 210,000 claims. - China’s fourth-quarter GDP grows at 5.4%, beating market expectations as stimulus measures kick in
China’s economy expanded by 5% year on year in 2024, with an upswing in the final quarter of the year, as a
flurry of stimulus measures kicked in and helped meet Beijing’s growth target. Fourth-quarter GDP beats
expectations with 5.4% growth, according to China’s National Bureau of Statistics. Reuters-polled economists
had estimated a 5.0% growth in the final quarter. That was faster growth compared with the 4.6% in the third
quarter, 4.7% in the second quarter, 5.3% in the first quarter. The full-year economic expansion was lower
compared with a 5.4% growth in 2023 post the pandemic. As part of an annual revision to preliminary figures,
the statistics bureau in late December revised the 2023 GDP growth to 7.4%, according to a CNBC calculation
of the official data. - UK economy’s disappointing November growth fuels the case for Bank of England rate cut
The U.K. economy grew at a lackluster pace of 0.1% in November, data from the Office of National
Statistics (ONS) showed Thursday, with the reading fueling expectations that the Bank of England will
proceed with an interest rate cut next month. The latest data print compares with the 0.2% month-on
month growth expected by economists polled by Reuters. Monthly real gross domestic product (GDP)
fell by 0.1% in October, following a decline of 0.1% in September and growth of 0.2% in August.
The ONS said the slight growth in economic output in November was largely due to growth in the
services sector. While meager, the data is the first sign of life in the U.K.’s wider economy for three
months. British Chancellor Rachel Reeves said in a statement after the data Thursday that she was
“determined to go further and faster to kickstart economic growth.” “That means generating
investment, driving reform and a relentless commitment to root out waste in public spending, and today
I will be pressing regulators on what more they can do to deliver growth,” she said in emailed comments
from the Treasury. The ONS nevertheless said the real GDP is estimated to have shown no growth in the
three months to November, compared with the three months to August. “Services showed no growth
over this three-month period, while production fell by 0.7% and construction grew by 0.2%,” the ONS
said in the data release. The British pound fell 0.2% against the dollar to trade at $1.2214 following the
GDP print, which comes as the Bank of England considers whether to lower interest rates at its next
meeting on Feb.6. Economists say the latest data only fuels the case for a rate cut next month, although
BOE policymakers will be factoring in inflationary pressures, such as resilient wage growth and
uncertainty over Britain’s economic outlook. The central bank’s inflation target is 2%. - US firm Hindenburg Research that accused Adani Group of fraud shuts down
US-based short-seller which had published reports accusing top financial entities in India and abroad of
financial wrongdoings and fraud is set to shut down. Nate Anderson, the founder of Hindenburg Research,
announced on Wednesday that he was disbanding the company almost eight years after starting it.
The firm had made headlines in India in 2023 after publishing explosive reports about billionaire Gautam
Adani’s conglomerate, sparking political rows and major losses for the company. Mr Anderson didn’t share a
specific reason for his decision, but expressed a desire to spend more time with friends and family in the
future. - Oil major BP to cut thousands of jobs in cost-saving drive
British oil major BP on Thursday said it is planning to cut thousands of jobs as part of a major cost-reduction
exercise. “Today, we have today told staff across bp that the proposed changes that have been announced to
date are expected to impact around 4700 bp roles – these account for much of the anticipated reduction this
year,” BP said in a statement. “We are also reducing our contractor numbers by 3000,” the company said.
The measures, which were designed to lower costs, come after BP CEO Murray Auchincloss said last year that
the company intends to deliver at least $2 billion of cash savings by the end of 2026. BP’s workforce currently
stands at around 87,800. Shares of the company traded 1.4% higher on Thursday morning. - EV, hybrid sales reached a record 20% of U.S. vehicle sales in 2024
Sales of all-electric vehicles and hybrid models reached 20% of new car and truck sales in the U.S. for the first
time last year — marking a landmark year for “green” vehicles but coming at a slower pace than many had
previously anticipated. Auto data firm Motor Intelligence reports more than 3.2 million “electrified” vehicles
were sold last year, or 1.9 million hybrid vehicles, including plug-in models, and 1.3 million all-electric models.
Traditional vehicles with gas or diesel internal combustion engines still made up the majority of sales, but
declined to 79.8%, falling under 80% for the first time in modern automotive history, according to the data.
Regarding sales of pure EVs, Tesla continued to dominate, but Cox Automotive estimated its annual sales fell
and its market share dropped to about 49%, down from 55% in 2023. The Tesla Model Y and Model 3 were
estimated to be the bestselling EVs in 2024. Following Tesla in EV sales was Hyundai Motor, including Kia, at
9.3% of EV market share; General Motors at 8.7%; and then Ford Motor at 7.5%, according to Motor
Intelligence. BMW rounded out the top five at 4.1%. The EV market in the U.S. is highly competitive: Of the
68 mainstream EV models tracked by Cox’s Kelley Blue Book, 24 models posted year-over-year sales
increases; 17 models were all new to the market; and 27 decreased in volume. - Netanyahu says deal to release Hamas-held hostages has been reached
Prime Minister Benjamin Netanyahu has said that a deal to return Hamas-held hostages in the Gaza Strip has
been reached. The announcement came in the early hours of Friday, a day after Mr Netanyahu’s office said
there were last-minute snags in talks to free hostages in return for a ceasefire in Gaza and the release of
Palestinian prisoners. Hamas rejected the accusations. “The Prime Minister ordered the political-security
cabinet to convene tomorrow. The government will then convene to approve the deal,” Mr Netanyahu’s
office said. It added that the families of the hostages had been informed and that preparations were being
made to receive them upon their return. If approved by Israel’s cabinet, the truce agreement would begin on
Sunday and involve the exchange of Israeli hostages for Palestinian detainees, after which the terms of a
permanent end to the war would be finalised. - Snap shares drop as FTC refers MyAI chatbot complaint to the DOJ
Snap shares closed down 5% on Thursday after the Federal Trade Commission said it would refer a complaint
against the company to the Department of Justice. The FTC’s non-public complaint involves allegations that
Snapchat’s My AI chatbot poses “risks and harms to young users,” the commission said in a statement. The
complaint stems from the FTC’s compliance reviews with Snap following a 2014 settlement regarding
allegations of public deception pertaining to data collection by the company. As part of the FTC’s compliance
reviews of Snap, the agency said it had uncovered the possibility that the company “is violating or is about to
violate the law.” “A proceeding is in the public interest,” the FTC said in its statement. - Apple has worst day since August following reports of China, AI struggles
Apple stock closed down 4% on Thursday, its worst day since Aug. 5, following several reports of lackluster
iPhone sales in China. The iPhone maker’s stock price is down nearly 12% from its most recent peak in
December, and it’s the worst-performing of the seven largest technology stocks so far in 2025. The slide
comes after a report Thursday from Canalys, a market research firm, which suggested that Apple had fallen
to third place in terms of smartphones sold in China in 2024, behind homegrown manufacturers Vivo and
Huawei. Apple shipped 15% of the 284 million phones sold in China last year, according to the report, but
that was down 17% on an annual basis. Vivo and Huawei, meanwhile, saw strong growth. - Duolingo shares climb 7% as users swarm to app to learn Mandarin
Duolingo shares rose nearly 7% on Thursday following a large spike in users signing up to learn Mandarin in
conjunction with soaring usage of Chinese social media app RedNote, a TikTok rival. The company confirmed
to CNBC that there’s been a 216% increase in Mandarin learners using the app compared to a year earlier.
For context, Spanish, one of the most popular languages on the app, has seen a 40% increase over the same
period, Duolingo said. RedNote, or Xiaohongshu, as it’s known in China, has rocketed to become the No. 1
free app on the Apple app store, a position it’s held for most of this week. Rounding out the top five are
TikTok’s Lemon8 app, U.S. social media upstart Clapper, OpenAI’s ChatGPT and Meta’s Threads. Last week,
the Supreme Court heard oral arguments in the case involving the future of TikTok in the U.S., and a law that
could effectively ban the popular app. The justices appeared to favor upholding the law, and a decision could
come as soon as Friday. TikTok is reportedly preparing for a U.S. shutdown on Sunday. RedNote has so far
been the top beneficiary of the American user exodus, seeing its U.S. app downloads increase by 20 times
over the last week, according to market intelligence firm Sensor Tower. A Duolingo spokesperson told CNBC
that the company’s marketing team is “forward-thinking and already has an active presence on Red,
managed by our team in China.” Duolingo offers online and mobile courses across 42 languages. According to
its website, Duolingo has 48.8 million Spanish learners. French is the second most popular language on the
app at 27.3 million users, while Chinese is eighth at 10.7 million. Duolingo shares climbed 43% last year,
topping the Nasdaq’s 29% gain. - Shares of Cartier owner Richemont jump 16% as sales rise in December quarter
Shares of Cartier owner Richemont jumped on Thursday after the luxury group reported a 10% increase in
fiscal third-quarter sales even as China demand weighed. Sales rose to 6.2 billion euros ($6.38 billion) at
constant exchange rates in the three months to the end of December, which the Swiss luxury brand dubbed
its “highest ever” quarterly sales figure. That was well above 1% increase expected by analysts in a consensus
cited by RBC, according to Reuters. Richemont shares closed 16.36% higher on Thursday. Other luxury
stocks Christian Dior, LVMH and Hermes moved higher at the results marked a positive signal for the health
of Europe’s luxury sector over the holiday shopping period. Richemont reported double-digit growth across
all regions except Asia Pacific, where sales fell 7%, led by an 18% decline in the combined regions of mainland
China, Hong Kong and Macau. China, once a key driver of luxury demand, has been a major drag on the
sector as it has struggled to emerge from a post-Covid-19 pandemic macro-economic slump. The Swiss
company’s share price has faced a volatile ride over the past year amid a rejig of its top management and
wider fluctuations in the luxury market. The stock jumped on the May appointment of new CEO Nicolas Bos,
former head of the group’s Van Cleef & Arpels jewellery brand. Shares are currently up 28.75% on the year.
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