Gold Rising, BYD Sends Tesla Stocks Tumbling, Aluminum Tariffs, Company News & Geopolitics
Stock market news
• Gold continues to grow steadily - already $2967. The coveted $3000 is getting closer. The growth of semiconductor stocks against the backdrop of growing capital investments of businesses in AI data centers helped stock indices grow yesterday. Weakness was in the financial sector. The yield on 10-year US government bonds stabilized around 4.5% per annum.
In general, everything remains calm. The market is waiting for a trigger for the next breakthrough.
• Gold made a run at $3,000 an ounce in Asia overnight, reaching $2,942, giving markets a relief valve from Donald Trump's unpredictability. Central banks have been big buyers for months, along with investors seeking safety. Worries about U.S. tariffs on gold have also sparked a rush to get it out of London vaults and across the Atlantic.
• Stocks broadly steadied on Tuesday after Trump said he was considering exempting Australia from steel tariffs following a call with Australia's prime minister, bolstering investor confidence that anything could be worked out. Trump likes the US's trade surplus with Australia, saying: "The reason is they buy a lot of planes. They're pretty far away and they need a lot of planes." He has promised to impose retaliatory tariffs on the countries over the next two days.
• Markets are also likely to focus on Fed Chairman Jerome Powell's testimony on Capitol Hill on Tuesday, where he is likely to face questions about his views on inflation and tariffs. He is scheduled to testify in court within two days, with his testimony due Wednesday after the release of consumer price data for January. Markets have already trimmed their expectations for rate cuts this year to just 38 basis points.
• Electric-vehicle battle heats up: Electric-vehicle stocks saw a DeepSeek-like shakeup on Tuesday. China's BYD began offering advanced autonomous-driving features on most of its models, including models priced as low as $9,555, well below rivals like Tesla. And Stellantis' Chinese partner Leapmotor on Tuesday unveiled a new electric car with intelligent-driving technology priced under 150,000 yuan ($20,535).
Tesla shares fell 3% to a two-month low overnight, while shares of Chinese automakers Xpeng and Geely Auto fell in Hong Kong trading on Tuesday. Meanwhile, BYD shares rose more than 4% in Hong Kong to hit a record high.
• President Donald Trump signed an executive order Monday night raising tariffs on aluminum and steel imports from 10% to 25%. That hit a host of trading partners, including Canada, Mexico, Japan and South Korea. Details, including when the tariffs will go into effect, have not yet been released. The news sent U.S. stocks CLF (+18%), NUE (+6%), STLD (+5%), AA (+2%), CENX (+10%) and X (+5%) higher yesterday.
Steel accounts for about 20% of the cost of heavy equipment. Companies typically add a premium for higher metal prices, passing them on to customers.
• Elon Musk and investors offered to buy the nonprofit that controls OpenAI for $97.4 billion.
Sam Altman responded: “No thanks, but we’ll buy Twitter for $9.74 billion if you want.”
Musk: “Altman is a fraud.”
• OpenAI is pushing ahead with its plan to reduce its dependence on NVIDIA and will complete its first in-house chip in the next few months - Reuters. TSMC will manufacture OpenAI's chip using 3nm technology.
• China uses US tech giants as leverage in trade talks - WSJ.
Chinese officials are preparing a list of US tech companies such as Nvidia, Google, Apple, Broadcom and Synopsys that could be the target of antitrust investigations. The move is part of Beijing's strategy to gain an edge in negotiations with the US administration on trade issues, including tariffs imposed by Trump on Chinese goods.
Monday-com (MNDY) saw its shares jump 26% after beating Q4 estimates.
The company's revenue grew 32% year over year, and non-GAAP earnings per share increased 66%. The growth was driven by innovative products and strong market performance.
• Trump announced that he would announce the introduction of 25% tariffs on steel and aluminum today - AP.
He specified that the tariffs would apply to imports of metals from all countries, but did not indicate the exact date they would come into effect.
• BP (BP) shares rose 7% after activist investor Elliott Management announced it had acquired a stake.
Elliott aims to drive strategic change to maximise shareholder value, potentially transforming BP's core oil and gas operations.
• ON Semiconductor (ON) shares fell 8% after forecasting weaker-than-expected results for the current quarter.
The company expects global semiconductor sales to slow and its revenue forecasts to miss Wall Street estimates.
• NXP Semiconductors (NXPI) announced it has acquired Kinara, a provider of neural processing units, for $307 million.
The acquisition is expected to strengthen NXP's artificial intelligence platform capabilities in the industrial and automotive sectors.
• Taiwan Semiconductor Manufacturing (TSM) expects first-quarter revenue to be below forecast due to earthquake-related disruptions. Despite this, the company is maintaining its full-year outlook, reporting no structural damage.
• T-Mobile (TMUS) has launched a public beta of its space mobile network powered by SpaceX's Starlink.
The service aims to provide text messaging via satellite, followed by data and voice.
• Labor costs and inflation will weigh on gold miners' results - Reuters
But the rapid rise in the yellow metal's price will still help boost free cash flow.
• McDonald's (MCD) misses fourth-quarter earnings target as it seeks to boost perceptions of value in 2025. It was a quarter filled with an E. coli outbreak and challenging weather; now McDonald's is looking to move the narrative forward.
MCD shares are up 5%.
• Musk suggests closer scrutiny of the Fed as Powell prepares to meet with Congress. He has suggested in a series of social media posts that the Fed should be subject to greater scrutiny.
Salesforce (CRM) plans to invest $500 million in AI development in Saudi Arabia.
As part of this investment, Salesforce will introduce the Hyperforce platform architecture, developed through a strategic partnership with Amazon Web Services, to the country.
• Hyatt (H) is betting on the growth of the all-inclusive industry with the $2.6 billion acquisition of Playa Hotels and Resorts.
• Financial services company FactSet (FDS) is acquiring LiquidityBook for $246.5 million. The deal will integrate FactSet's existing workflow with LiquidityBook's cloud-based trading solutions, increasing efficiency and strengthening FactSet's position in the financial services platform market, the company said.
• Saudi Arabia's NEOM, an urban and industrial complex on the Red Sea, has signed a deal with DataVolt - Reuters. The agreement is to develop a 1.5 gigawatt (GW) AI project in the Oksagon Industrial Zone in the Saudi Arabian state.
• Moody's warns of triple jeopardy if Trump ends World Bank support. The triple-A ratings of the World Bank and other leading multilateral lenders would be at risk if the United States stopped supporting them following a review ordered by the US president.
• Google CEO: The main risk is to miss out on AI, to fall behind in the AI race.
• Musk: "Tesla is still on track to launch autonomous ride-hailing in Austin in June and in many cities across America by the end of this year. The threshold is to achieve safety far beyond the average human driver. Eventually, autonomous cars will be >1000% safer than human-driven cars."
• GME shares rose 10% yesterday, sparked by a photo of the GME CEO posing with Michael Saylor, executive chairman of Strategy (MSTR), prompting speculation that GME could begin to copy MSTR's strategy of buying bitcoin with its $5 billion in cash.
• Analyst Tom Lee (Fundstrat) on Bitcoin: There has never been a case in the history of finance where something reached $2 trillion and disappeared.
• TSLA reports increase in its Bitcoin holdings to 11509, worth over $1 billion.
• El Salvador bought more bitcoin for its strategic BTC reserve.
• BTC Mining Difficulty Reaches New All-Time High. Bitcoin mining difficulty has reached 114.7 trillion, up 5.6%, and the Hash Ribbon metric is indicating miner capitulation. Historically, such signals have heralded a local bottom in BTC price. According to Glassnode, the capitulation began in early February. If the trend continues, BTC could bottom around $91K. A similar signal preceded a 50% rally in October 2024.
Co-Founder Glassnode: Macro Dashes Could Be Key Trigger for BTC
• FOMC members and the Fed chief will speak on Tuesday, followed by U.S. inflation data midweek - two key macroeconomic events that could significantly impact markets.
• MicroCloud Hologram (HOLO) plans to invest up to $200 million in Bitcoin and other digital currencies as part of its capital reserve strategy. The move is intended to diversify the company's asset portfolio and improve risk tolerance.
Key events that could impact markets on Tuesday:
- Earnings: BP, Banco BPM
- Speeches: Bank of England's Mann and Bailey
- Jerome Powell testifies before the Senate Banking, Housing and Urban Affairs Committee
Fundamental news
• Official China has released a video about its preparations for a nuclear war. In it, it showed 5,000 km of tunnels designed to protect intercontinental ballistic missiles from a nuclear strike. Beijing is telling the US through many channels that it is ready to escalate the confrontation. And it will not give Russia into the sphere of American influence.
Perhaps the White House has realized that the attempt to flirt with the Kremlin in order to prevent Russia from entering into a strong alliance with China has failed. And it has failed a long time ago. But let's see how Trump will actually behave.
• CNN: 70% of Americans say Trump is doing exactly what he said he would do. And his approval rating is at an all-time high.
• Elon Musk and Coinbase CEO have proposed transferring $6.9 trillion in US government spending to the blockchain - this will ensure transparency, protection from hacking and immediate detection of fraud.
• The Pentagon cannot account for 63% of its assets.
• Musk: "OMG, the deficit is even worse than expected!!! Fraud and waste have accelerated significantly under the Biden administration"
In response to the post: "The first four months of FY25 have produced a deficit of $838 billion. That's $306 billion more than the deficit recorded in the same period last fiscal year. We have an annual deficit of $2.5 TRILLION." The battle over the US budget is escalating. But the beneficiaries of the budget trough will desperately resist. Including by throwing mud at Musk.
• CNBC: The CEO of a real estate company that leases properties to the federal government said the government's construction costs are 3 times higher than his (the private sector's). For the same building. Corruption at the public trough is a total problem. Will blockchain rule?
• Democrats may use government shutdown to extract concessions from US President Donald Trump - CNN
Democratic Senator Cory Booker said Democrats would use a government shutdown or a default on the national debt to counter Donald Trump's actions.
• Trump has ordered the Treasury Department to stop minting pennies. For too long, the U.S. has been issuing pennies that cost us more than 2 cents apiece. It's a colossal waste of money!
• Trump said he was going to "buy Gaza" and hand over control to Middle Eastern countries. He believes that the United States must own and maintain control over the territory to prevent Hamas from returning.
And the return of Palestinians to the Gaza Strip after the end of the conflict with Israel would be a mistake.
Erdogan responded to this by saying that the people of the Gaza Strip would continue to live in the enclave.
The proposals of the new American administration on Gaza are complete nonsense,
- Turkish President Recep Tayyip Erdogan.
• The EU is preparing for a large-scale operation in the Baltic Sea to seize tankers used to export Russian oil - Politico. The possibility of using international law to seize Russian ships for alleged environmental reasons or suspicions of piracy is being considered.
If we have to respond to customs measures from the United States, we will do so without hesitation, - French Foreign Minister Jean-Noël Barrot.
• Romanian President Klaus Iohannis will resign on February 12. New presidential elections will not be held until May - Juridice. He made this decision against the backdrop of attempts by the opposition in parliament to impeach him.
• Macron announced that France will invest €109 billion in AI over the next few years.
Saudi Arabia has committed $14.9 billion to developing artificial intelligence,
forming global partnerships with tech giants like Google, Lenovo and Alibaba.