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Wednesday, January 22

Some of the largest macro moves in the market today: NVIDIA Corp (NVDA) +3.1%. Broadcom Inc (AVGO) +2.5%. Microsoft Corp (MSFT) +2.0%.

European stock markets are experiencing broad gains, with the DAX 30 Index rising by approximately 1.3% and reaching record highs amid expectations of interest rate cuts from the European Central Bank (ECB). ECB officials have indicated that a reduction in rates is likely at their upcoming meetings to support economic growth, which has contributed to positive sentiment across equity indices.

In political developments, U.S. President Donald Trump reiterated plans for potential tariffs on imports from China as well as Canada and Mexico starting February 1st. This announcement has created volatility in market sentiments but also led to some relief among investors who were initially concerned about immediate tariff implementations following his inauguration.

Economic data releases show mixed results; while Canadian raw materials prices rose more than expected due primarily to increases in metal ore prices driven by supply constraints related to China's export policies, industrial producer prices fell short of forecasts despite showing an overall increase year-on-year. In the United States, mortgage applications saw only a slight uptick after significant previous surges attributed partly to easing long-term Treasury yields influenced by inflation trends.

SPDR S&P 500 ETF Trust (SPY) [+0.5%]
The SPDR S&P 500 ETF Trust (SPY) has seen a premarket increase of approximately 0.42%. This movement coincides with positive headlines surrounding advancements in artificial intelligence and strong earnings from Netflix. Notably, Netflix reported robust Q4 2024 earnings, surpassing expectations and adding nearly 19 million new streaming users. Additionally, recent remarks from JPMorgan CEO Jamie Dimon highlighted the potential benefits of a slight inflation increase for national security, while trade tariff discussions from the Trump administration may also influence market dynamics. In terms of SPY's holdings, significant contributions came from NVIDIA, Microsoft, and Oracle, reflecting strong market interest in technology and AI ventures.

iShares China Large-Cap ETF (FXI) [-0.6%]
The iShares China Large-Cap ETF (FXI) has seen a price decline of 0.6% since Tuesday. The Shanghai Composite Index fell by 0.89%, while the Shenzhen CSI 300 dropped by 0.93%. Hong Kong's Hang Seng Index decreased by 1.63%. These declines reflect ongoing concerns regarding trade policy amid President Trump's initial tariff actions. Social media discussions highlighted China's plans to enhance investments in the A-share market through state insurers and funds, as well as to offer equal treatment for foreign financial institutions in free trade zones. However, concerns remain regarding potential tariffs on Chinese imports, as Trump considers a 10% tariff related to fentanyl issues. Notably, FXI had experienced six consecutive days of gains prior to these recent developments. Among its holdings, LI and TCOM contributed negatively to the ETF's performance, while JD showed a positive return.

NFLX | +14.7% | +63.6B
Netflix Inc | Movies & Entertainment
Netflix reported robust Q4 2024 earnings, with adjusted earnings per share of 4.27, exceeding estimates, and revenue of 10.25 billion, surpassing forecasts. The company added 18.91 million net paid streaming users, significantly above the expected 9.18 million, raising total memberships to 301.63 million, a year-over-year increase of 15.9%. Netflix also raised its FY25 revenue guidance to between 43.5 billion and 44.5 billion, reflecting anticipated growth of 12-14%. A 16% price increase for its standard plan, now priced at 17.99, coincided with this performance. Following these announcements, Netflix shares surged, reaching an all-time high after the introduction of a new $15 billion share buyback program and the launch of an ad-supported membership option in ten countries.

ORCL | +10.7%| +56.3B
Oracle Corp | Systems Software
Oracle Corp has launched new generative AI and intelligent agents within Oracle Fusion Cloud Sales, aimed at enhancing customer engagement and streamlining sales processes. This announcement was made during the Oracle CloudWorld Tour and includes features for automating communication and maintaining updated records. Additionally, Oracle is collaborating with SoftBank and OpenAI on the $500 billion Stargate project, which plans to establish extensive AI data centers across the U.S., starting with a facility in Abilene, Texas. These developments were underscored by a recent visit from CEO Larry Ellison to the White House. Social media discussions have noted a significant rally in Oracle shares following these announcements, with reports indicating a substantial increase in stock price after the unveiling of the Stargate project, which aims to create significant AI computing systems in partnership with Nvidia and OpenAI.

SFTBY | +15.0% | +7.7B
SoftBank Group Corp | Wireless Telecommunication Services
SoftBank Group Corp's stock has surged following news that CEO Masayoshi Son has pledged a substantial $100 billion investment in artificial intelligence within the United States. This commitment has garnered attention on social media, with discussions highlighting both SoftBank and NVIDIA as key tickers of interest. The significant price movement reflects this heightened focus on SoftBank's strategic direction in the AI sector.

PG | +3.3%| +12.8B
Procter & Gamble Co | Household Products
Procter & Gamble Co. reported its fiscal Q2 results, revealing net sales of $21.88 billion, exceeding the estimate of $21.54 billion. Core earnings per share (EPS) reached $1.88, surpassing the consensus of $1.86. Organic revenue growth was 3%, outpacing the expected 2.35%. The company reaffirmed its fiscal 2025 guidance, projecting core EPS growth of 5% to 7% and all-in sales growth of 2% to 4%. Operating cash flow for the quarter was $4.8 billion. Despite challenges from foreign exchange and commodity costs, Procter & Gamble expressed confidence in meeting its financial targets for the fiscal year. Discussions on social media highlighted a year-over-year increase in net sales and the company's ongoing commitment to innovation within its product segments.

TRV | +5.4% | +3.1B
Travelers Companies Inc | Property & Casualty Insurance
Travelers Companies Inc. reported strong Q4 results, with total revenues reaching $12.008 billion, an increase from $10.927 billion year-over-year. The core earnings per share (EPS) stood at $9.15, significantly higher than the previous year's $7.01 and surpassing analyst expectations of $6.65. Net written premiums rose to $10.742 billion, reflecting a 7% increase compared to last year. Net income surged 28% to $2.082 billion, up from $1.626 billion in the prior year. Additionally, adjusted book value per share increased to $139.04, marking a 13% rise year-over-year. The strong performance was driven by higher insurance premiums and a 23% increase in investment income, which reached $955 million. Following the earnings announcement, Travelers saw a price movement of approximately 10%.

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