- Asian Stocks Fluctuate, Dollar Dips After US Data: Markets Wrap
Stocks in Asia drifted at the start of the week as traders refrained from making riskier bets after lackluster
economic data spurred a selloff on Wall Street. The dollar declined against its peers, notably the euro.
Benchmarks in Hong Kong and mainland China, which got a lift from technology stocks this year, traded in
tight range. A gauge of Asian equities edged lower after hitting a four-month high Friday. US equity index
futures advanced, as did contracts on Germany’s benchmark stock index after the conservative party came in
first in the country’s federal election. The prospects for artificial intelligence has fueled a rally in Chinese
technology stocks, offsetting the risks from US tariffs and shifting wagers on Federal Reserve policy easing.
Data late last week showed US inflation expectations rising to the highest level in almost three decades. - Dow drops 700 points for worst day of 2025 so far on new fears about economic growth
Stocks sold off on Friday as new U.S. data sparked concern among investors over a slowing economy and
sticky inflation, leading them in search of safer assets. Losses intensified into the close as traders feared
staying long into a weekend that could bring another barrage of headlines from the Trump administration,
which has proposed a flurry of tariffs and other market-moving policy changes since taking charge a month
ago. The Dow Jones Industrial Average lost 748.63 points, or 1.69%, to close at 43,428.02. Friday’s decline, its
worst in the young year, brought its two-day losses to roughly 1,200 points. The S&P 500 slid 1.71% to end at
6,013.13, marking a second negative session after the index closed at a record on Wednesday. The Nasdaq
Composite dropped 2.2%, settling at 19,524.01. For the week, the S&P 500 slid about 1.7%, while the Dow
and Nasdaq both lost 2.5%. - Oil settles down $2, posting weekly loss as Mideast risk premium fades
Oil prices settled down more than $2 a barrel on Friday, posting a weekly decline as investors grappled with a
fading Middle East risk premium alongside uncertainty about a potential peace deal in Ukraine. Brent futures
settled down $2.05, or 2.68%, to $74.43 a barrel, while U.S. West Texas Intermediate crude settled down
$2.08, or 2.87%, to $70.40. Brent settled 0.4% down on the week, while U.S. crude futures posted a 0.5%
weekly loss. “There is a risk-off tone here,” said John Kilduff, a partner at Again Capital in New York, also
citing relative calm in the Middle East as the Gaza ceasefire holds. Investors also continued to weigh an uptick
in U.S. crude oil stockpiles, reported on Thursday, as seasonal maintenance at refineries led to lower
processing, the Energy Information Administration said. U.S. energy firms this week added oil and natural gas
rigs for a fourth week in a row to the highest level since June, energy services firm Baker Hughes said in a
report on Friday. The oil and gas rig count, an early indicator of future output, rose by four to 592 in the week
to February 21. Traders’ focus was also on oil supply disruption however, capping some losses. Russia said
Caspian Pipeline Consortium oil flows, a major route for crude exports from Kazakhstan, were reduced by 30
40% on Tuesday after a Ukrainian drone attack on a pumping station. However, oil flows from Kazakhstan’s
Tengiz oilfield via CPC are uninterrupted, Russian news agency Interfax reported on Friday, citing
Tengizchevroil. - Gold prices retreat as traders lock in profits; U.S. data in focus
Gold prices retreated on Monday as traders locked in profits after recent record highs, with attention shifting
to a key U.S. inflation report set for release later this week. Spot gold was down 0.4% at $2,925.63 an ounce,
as of 0204 GMT. Bullion scaled an all-time high of $2,954.69 on Thursday. U.S. gold futures dipped 0.5% to
$2,939.30. “Gold has been unable to capitalize on the broader risk-averse theme of the market, with profit
taking moves offsetting any rise in safe-haven demand,” said Tim Waterer, chief market analyst at KCM
Trade. “With trade uncertainties not looking like they are disappearing anytime soon, gold could still be
eyeing off reaching new all-time highs again this week.” U.S. President Donald Trump said last week that he
would announce fresh tariffs over the next month or sooner, adding lumber and forest products to previously
announced plans to impose duties on imported cars, semiconductors, and pharmaceuticals. This follows the
already-imposed additional 10% levy on Chinese imports and a 25% tariff on steel and aluminum. - China’s latest action plan shows it’s trying to boost foreign investment amid geopolitical tensions
China on Feb. 19 published a “2025 action plan for stabilizing foreign investment” to improve the ability of
foreign capital to invest in domestic telecommunication and biotechnology industries, according to a CNBC
translation of the Chinese. “We are looking forward to see this implemented in a manner that delivers
tangible benefits for our members,” Jens Eskelund, president of the European Union Chamber of Commerce
in China, said in a statement. “This action plan is a very strong signal,” Xiaojia Sun, Beijing-based partner at
JunHe Law, said in Mandarin, translated by CNBC. - Germany’s conservatives win election as far-right AfD leaps to second place, exit polls show
The Christian Democratic Union and the allied Christian Social Union secured the largest share of votes in the
German federal election on Sunday, according to exit polls from German broadcaster ZDF. This puts the
party’s lead candidate Friedrich Merz in prime position to take over from Olaf Scholz as chancellor of
Europe’s largest economy. The far-right AfD came in second with 20% of votes, the exit poll data indicated. - Singapore inflation climbs at the slowest rate since February 2021
Singapore’s inflation climbed by its lowest rate since February 2021, increasing 1.2% year on year in January,
down from 1.6% in December. This is the first key piece of economic data since Singapore unveiled its 2025
budget on Feb. 18, which promised more support for households and businesses to combat cost of living
pressures. During the budget speech, Prime Minister Lawrence Wong said, “While inflation is expected to
ease further this year, prices remain high. Singaporeans are still adjusting to these new price realities.”
The headline inflation figure is a wide miss from the 2.15% rise expected by economists polled by Reuters.
Core inflation in the country — which, strips out prices of private transport and accommodation — rose by
0.8% year on year, down from December’s 1.8% rise and below the 1.5% growth expected. - Battered and bruised after 3 years of war, Ukraine is up against the ropes as U.S. backing vanishes
Ukraine has put up a staunch fight against the invasion launched by its bigger and more powerful neighbor
Russia, but things appear to be going horribly wrong for it as the war’s third anniversary approaches. Kyiv’s
relationship with the United States, its biggest military backer since the start of the war, has gone rapidly
downhill since President Donald Trump’s inauguration. At the same time, relations between Moscow and
Washington are undergoing a revival, leaving Ukraine and its European allies dumbfounded. - UnitedHealth shares tumble as much as 13%, the most intraday since March 2020, after the US Justice
Department opened an investigation into the health insurer’s Medicare billing practices
Shares of other health insurers are also lower on the news: Humana -4.1%, Alignment Healthcare -5.3%,
Elevance Health -1.4%. UnitedHealth calls news of the probe “misinformation” and defends its billing
practices in a statement to Bloomberg News. RBC Capital Markets, Ben Hendrix (outperform): Calls the share
reaction to the news overdone “given what we expect is a long-date probe with an extended timeline to any
resolution”; “The DOJ’s investigation, while an incremental overhang, is likely to be a lengthy process and
unlikely in our view to result in material financial headwind in the near term”. Mizuho, Ann Hynes
(outperform): Says while the investigation is new, “the upcoding practices of Medicare Advantage plans is not
news”; “We do not expect an incremental negative EPS impact as a result of this investigation”; “We expect
the DoJ probe to take years and will likely result in a monetary fine”; Recommends buying the dip in the
stock. - Microsoft has cancelled data center leases in the US, TD Cowen says
Microsoft Corporation (NASDAQ:MSFT) has cancelled data center leases with at least two operators in the
U.S. TD Cowen said in a recent note, and that the company had also scaled back plans for international
spending. The cancelled data center leases amount to “a couple of hundreds of megawatts,” TD said, citing a
channel check into Microsoft. A channel check uses information from supply chains and third parties to gauge
trends and the health of a company. Microsoft appeared to have re-allocated a “considerable portion” of its
international spending plans back to the U.S., TD said, heralding a potential scaling back of the company’s
international expansion. TD said its channel checks also showed Microsoft has scaled back converting signed
statements of qualifications into data center leases, although it was unclear if the move was a delay or a
termination. TD’s channel check showed the company had walked away from several data center deals for
over 100 megawatts, let over 1 gigawatt of deals expire, and had walked away from at least five land parcels
for more data center capacity. - Nvidia secures 70% of TSMC advanced packaging capacity for 2025- Taiwan media
NVIDIA Corporation (NASDAQ:NVDA) has secured more than 70% of contract chipmaker TSMC’s (NYSE:TSM)
advanced chip packaging capacity for 2025, Taiwanese media reported on Monday, amid increased artificial
intelligence demand for chips. A report from Taiwanese newspaper Economic Daily- citing unnamed industry
sources- said that increased demand for Nvidia’s next-generation Blackwell AI chips was strong, and that the
firm had already contracted over 70% of TSMC’s Chip on Wafer on Substrate with silicon interposer capacity
for 2025. TSMC’s Taiwan shares trimmed some intraday losses after the report. TSMC is currently the only
mass market provider of advanced chip packaging processes- which involve combining multiple
semiconductors into a single electronic device, and occurs at the fabrication stage. The company is also the
world’s biggest contract chipmaker. Reports in late-2024 showed Nvidia had already contracted at least 60%
of TSMC’s advanced packaging capacity for 2025, as the company benefited from increased demand for AI
data center chips. Recent earnings reports from Microsoft (NASDAQ:MSFT), Google (NASDAQ:GOOGL), Meta
(NASDAQ:META), and Amazon- Wall Street’s so-called AI hyperscalers- indicated that outsized capital
spending on AI was set to continue in 2025- heralding strong demand for Nvidia. This in turn is expected to
translate into strong demand for TSMC. The company recently clocked stellar fourth-quarter earnings, and
said it will ramp up its manufacturing and packaging operations in 2025 to meet increased AI demand. TSMC
is also expected to benefit from an increased push in the U.S. to build more AI infrastructure. - Alibaba to invest $52.4 bln in cloud & AI infrastructure; shares hit 3-yr high
Alibaba Group (NYSE:BABA) announced plans on Monday to invest 380 billion yuan ($52.4 billion) over the
next three years to boost its cloud computing and artificial intelligence (AI) infrastructure, marking its largest
technology investment to date. The move underscores Alibaba’s ambition to lead in AI-driven growth and
solidify its position as a global cloud provider, the company said. Hong Kong-listed Alibaba (HK:9988) shares
rose 0.7% to HK$139.40 as of 02:50 GMT to their highest level since November 2021. In its latest quarterly
report released last week, Alibaba reported a 7.6% year-over-year increase in revenue for the December
quarter, totaling 280.15 billion yuan, slightly surpassing analysts’ expectations. During the earnings call, CEO
Eddie Wu called AI a “once-in-a-generation” opportunity, highlighting Artificial General Intelligence (AGI) as
the company’s long-term goal. Alibaba Cloud, already the company’s fastest-growing segment, saw an 11%
year-over-year revenue increase last quarter, with AI-related product revenue posting triple-digit growth for
the sixth consecutive quarter. Wu emphasized that cloud services remain Alibaba’s primary revenue driver in
AI, fueled by rising demand for AI hosting solutions.
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