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Wednesday, January 8

Some of the largest macro moves in the market today: US Dollar Index +0.5%. GBP/USD -1.2%. Noteworthy US mega-cap moves today: Alphabet Inc (GOOGL) -1.8%. Alphabet Inc (GOOG) -1.7%. Exxon Mobil Corp (XOM) -1.1%. 

Recent developments in the financial markets have been significantly influenced by U.S. President-elect Donald Trump's consideration of declaring a national economic emergency to implement new tariffs. This has led to an increase in the value of the U.S. Dollar and negatively impacted risk assets such as stocks and commodities. This news coincided with rising Treasury yields, particularly for 10-year notes reaching above 4.7%, reflecting market concerns about prolonged inflationary pressures following strong employment data.

In Europe, mixed economic signals are emerging from key indicators; while Eurozone services sentiment improved slightly beyond expectations, the overall Economic Sentiment Indicator (ESI) fell sharply to its lowest level since November 2020 due primarily to declines among industrials and consumers across major economies like Germany and France. Additionally, German factory orders unexpectedly plunged by 5.4% month-on-month in November compared to previous estimates suggesting stability.

Market participants are also closely monitoring upcoming labor market reports including ADP Employment Change figures expected later today along with initial jobless claims data that could further influence Federal Reserve policy outlook amid ongoing discussions regarding interest rate adjustments throughout this year based on recent robust economic performance metrics.

iShares 20+ Year Treasury Bond ETF (TLT) [-0.5%]
The iShares 20+ Year Treasury Bond ETF (TLT) has seen a decline of 0.5% since the previous close. This movement coincides with a rise in the 10-year Treasury yield, which has reached new highs at 4.725%, following a broader market downturn. The U.S. 30-Year Treasury Bond has also declined, reflecting the upward trend in yields. Recent social media discussions highlighted that TLT has dropped significantly since early December, contrasting with gains in other assets. Additionally, the US 5-Year Treasury Bond has decreased slightly, which may further influence TLT's performance given their historical correlation. These developments suggest a challenging environment for long-duration bond investments amid rising borrowing costs and shifting market sentiment.

EUR/USD (EUR/USD) [-0.5%]
The EUR/USD is currently trading around 1.0320, reflecting a decline after being rejected above the 1.0400 level earlier in the week. This movement follows disappointing German factory orders data for November, which showed a significant contraction. Eurozone economic sentiment has also dropped to its lowest level since November 2020, indicating worsening confidence among industrials and consumers amid ongoing recessionary pressures. Additionally, social media highlights the unexpected 5.4% drop in German industrial orders and a 0.6% decline in retail sales for November. French consumer confidence remained stable at 89, while Germany's 10-year bund auction yielded a higher interest rate. Notably, GBP/USD has declined, reflecting broader market sentiment that may influence EUR/USD's recent movement.

NVO | +3.1% | +9.0B
Novo Nordisk A/S | Pharmaceuticals
Novo Nordisk A/S has announced an expanded collaboration with Valo Health, Inc. to develop treatments for obesity, type 2 diabetes, and cardiovascular disease. This new agreement allows for the development of up to 20 novel drug programs, a significant increase from the previous 11. Valo will receive an upfront payment and milestone payments totaling $190 million, with potential additional payments of approximately $4.6 billion. This partnership builds on their initial collaboration from September 2023 and aims to leverage Valo's AI-driven capabilities alongside Novo Nordisk's expertise. Concurrently, social media discussions reflect optimism about the company's future, with posts expressing excitement for 2025 and highlighting connections with Eli Lilly. Analysts have given Novo Nordisk a consensus recommendation of "Moderate Buy," with recent upgrades from several brokerages, contributing to a generally positive outlook on the stock's performance.

BSX | +2.7% | +3.8B
Boston Scientific Corp | Health Care Equipment
Boston Scientific Corporation has entered into a definitive agreement to acquire Bolt Medical, Inc., which specializes in an advanced laser-based platform for intravascular lithotripsy targeting coronary and peripheral artery disease. The acquisition involves an upfront payment of approximately 443 million for the 74% stake not already owned, with additional potential payments of up to 221 million contingent on regulatory milestones. Boston Scientific currently holds a 26% equity stake in Bolt Medical, having initially developed the concept for the Bolt IVL system in 2019. The transaction is expected to close in the first half of 2025 and is projected to be slightly dilutive to adjusted earnings per share in that year. The stock price has increased by 2.7% since Tuesday.

NVDA | +1.2%| +41.1B
NVIDIA Corp | Semiconductors
NVIDIA Corp's CEO, Jensen Huang, delivered a keynote at CES 2025, unveiling plans for automation and driverless vehicles. The company launched the RTX 5090D, a graphics card designed for China, which features a significant reduction in AI performance due to U.S. trade sanctions. Despite this setback, the RTX 5090D maintains most specifications of its global counterpart and is priced at CN¥ 16,499 ($2,250) for a January 30 release. Huang also introduced the "Mega Omniverse Blueprint," aimed at improving warehouse operations through AI-driven simulations. Following these announcements, NVIDIA's stock dropped significantly on Tuesday but showed signs of recovery in after-hours trading. Social media discussions highlighted Huang's remarks on AI chip advancements exceeding Moore’s Law and hinted at plans for a desktop CPU. Additionally, Huang confirmed Samsung's ongoing work on High Bandwidth Memory (HBM) for NVIDIA's AI chips.

EBAY | +6.2% | +2.1B
eBay Inc | Broadline Retail
eBay Inc. shares have increased significantly, coinciding with Meta Platforms' announcement of a test integration allowing users in Germany, France, and the United States to browse eBay listings directly on Facebook Marketplace. This initiative aims to enhance visibility for eBay sellers while enabling Marketplace users to discover a broader range of listings. Although transactions will still be completed on eBay, this strategic collaboration is expected to benefit both platforms' user bases. The positive market sentiment surrounding this news has contributed to the notable rise in eBay's stock price.

AMD | -1.8%| -3.7B
Advanced Micro Devices Inc | Semiconductors
Advanced Micro Devices Inc (AMD) has seen its shares decline by approximately 1.7% in premarket trading following a downgrade from HSBC, which shifted its rating from Buy to Reduce and set a new price target of $110. This downgrade aligns with a broader market sentiment reflected in a slight decrease in the S&P 500 Index. Concurrently, AMD announced a $20 million investment in Absci Corporation, a drug-discovery startup, aimed at leveraging AMD's AI technology for drug discovery applications. This partnership has resulted in a notable surge in Absci's stock price. Social media discussions indicate that despite the current negative sentiment around AMD, there is optimism regarding its future performance, particularly in light of its data center revenue growth since 2020.

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