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View detailsTrump supported investment, and the "Stargate" pulled hundreds of billions, and the US AI industry chain rose across the board.
Trump officially announced a major AI project, with a planned investment of 500 billion US dollars, and the shares of Oracle Bone Inscriptions, NVIDIA and Arm rose across the board. On Tuesday evening of 21st EST, Trump announced the "Stargate" project. After the news came out, U.S. technology stocks collectively rose overnight, and the stock prices of Oracle Bone Inscriptions, NVIDIA and other companies all rose significantly. As of the close of the day, Oracle Bone Inscriptions rose 7%, NVIDIA rose 2% and Arm rose 4%, outperforming the major technology ETF(XLK) and the S&P 500 index. Investment exceeds 100 billion, and giants merge to "let go" As mentioned on Wall Street, the Stargate project is planned by OpenAI, Softbank and Oracle Bone Inscriptions to establish a joint venture called Stargate to jointly invest heavily in AI infrastructure. It is estimated that the initial capital will be 100 billion US dollars, and the investment scale will increase to 500 billion US dollars within four years. According to media reports, on the eve of taking office, Trump publicly stated that he would pave the way for "people with a lot of money" to invest in "AI factories" in order to provide electricity for data centers; Meta CEO Zuckerberg, Amazon founder Bezos and other technology giants attended Trump's inauguration ceremony on Monday; One of Trump's first actions after taking office was to revoke the AI executive order of Biden. This means that, unlike Biden, Trump has a very positive attitude towards AI after taking office, which not only allows enterprises to "let go", but also greatly pulls investment. Sarah Friar, chief financial officer of OpenAI, said that in terms of technology and artificial intelligence, the Trump administration has shown "real will" and "is in a very leading position in the economy". Some analysts pointed out that the launch of the "Stargate" project may indicate that the Trump administration has begun to seek cooperation with technology companies. Demis Hassabis, CEO of Google DeepMind, said in an interview on Tuesday: "Obviously, the new government will encourage the development of science and technology." "The government is getting advice from people who really understand the frontier dynamics." What does it mean for the three companies? Some analysts believe that as the leading party of this project, OpenAI can obtain a large number of data center computing resources through cooperation, Oracle Bone Inscriptions is expected to become a key infrastructure provider and get more orders, while Softbank will get the "admission ticket" for this major project with its "financial resources". Larry Ellison, the founder of Oracle Bone Inscriptions, mentioned in his White House speech that Oracle Bone Inscriptions had been cooperating with OpenAI and Softbank before the Stargate project was officially announced. Mizuho analyst Siti Panigrahi said in a report to customers: "This is an important opportunity for Oracle Bone Inscriptions, which may become a key infrastructure provider for this large-scale investment." Speaking at the White House, Sun Zhengyi, CEO of Softbank, said that he had promised to invest $100 billion in the United States last month, and Trump suggested that he double his investment. Today, this figure has increased to $500 billion. Altman, founder and CEO of OpenAI, also said: "I am very happy that we can do this in the United States. I think this will be the most important project of this era. " Guangfa: "Stargate" has become a "national project" in the United States, highlighting the "extreme importance" of AI. GF Securities believes that Stargate has become a "national project" in the United States, which reflects the extreme importance of AI development. The average capital expenditure of $500 billion in four years is $125 billion per year ($100 billion in 2025). As an analogy, the sum of capital expenditures of Microsoft, Google, meta and Amazon in 2024 (including non-AI) is only about $220 billion. GF Securities believes that although the project is a great "political achievement" in the field of science and technology since Trump took office, it has a high probability of implementation. It is expected that Stargate will continue to expand the markets of light, copper, data center interconnection (DCI), local power resources/energy storage systems/small reactors in Texas, liquid cooling systems and server power supplies. As far as the combined enterprise structure is concerned, Guangfa expects that Softbank and OpenAI are Stargate's main partners, Softbank is responsible for finance and OpenAI is responsible for operation; Arm, Microsoft, NVIDIA, Oracle Bone Inscriptions and OpenAI are key initial technology partners. Risk warning and exemption clause The market is risky and investment needs to be cautious. This paper does not constitute personal investment advice, nor does it take into account the special investment objectives, financial situation or needs of individual users. Users should consider whether any opinions, viewpoints or conclusions in this article are in line with their specific situation. Invest accordingly at your own risk.
2025-01-22 -
View detailsNew Debt King: The Fed's "No Interest Rate Reduction in December" was Powell's worst decision.
Recently, Jeffrey Gundlach, CEO of DoubleLine, who is known as the "new debt king", sharply criticized the Fed's policy at a round table, and said that the decision of Federal Reserve Chairman Powell not to cut interest rates at the meeting last December was the "worst time" during his tenure. Gundlach pointed out at the meeting that the current Fed is in an embarrassing situation, that is, Powell has only one policy tool to carry out what he called "dual mission (the dual goal of the Fed to maintain price stability and maximize employment)" against the background of inflation above the target level and rising unemployment rate. Gundlach said: "Powell is now standing on the dock with one foot and the other foot in the canoe. When the two begin to separate, he is bound to get wet." Data in recent months show that the US CPI has risen for five consecutive months. Gundlach believes that the Fed seems to have returned to the state of over-correction. In particular, these data show that the Fed has paid too much attention to short-term fluctuations and neglected long-term trends in the past few months, which is also the reason for the birth of the "super core inflation indicator". He believes that there is a contradiction between Powell's two goals, inflation and unemployment rate. On the one hand, although the unemployment rate is not rising fast, it is still slightly higher than the 36-month moving average, which lights up the yellow warning of economic recession; On the other hand, inflation expectations may get out of control. But the balance between the two seems difficult to achieve, which also means that one party must make concessions. Gundlach said that the concession is unlikely to be the inflation rate, "because I don't think the inflation rate of 2.5% or even 2.75% is too big a challenge for the Fed, but what should we do if the unemployment rate continues to rise and the inflation rate remains at 2.5%, 2.75% or even 3%?" He pointed out that if Powell wants to prevent the unemployment rate from rising excessively, the United States will continue to face a sharp and steep yield curve, and the yield spread of 2-year and 10-year US Treasury bonds has shifted from -100 basis points to +40 basis points now. Gundlach stressed that from all the periods when the Fed turned to easing policy in history, he saw for the first time that the long-term yield increased significantly from the previous rate hike, suspension to interest rate cut. He criticized: "The Federal Reserve (which did not cut interest rates last December) was the worst experience." Risk warning and exemption clause The market is risky and investment needs to be cautious. This paper does not constitute personal investment advice, nor does it take into account the special investment objectives, financial situation or needs of individual users. Users should consider whether any opinions, viewpoints or conclusions in this article are in line with their specific situation. Invest accordingly at your own risk.
2025-01-21 -
View detailsThe Trump couple "issued coins", which shocked not only American politics, but also the currency circle.
On the occasion of returning to the White House, Trump and his wife successively launched personal MeMe coins-Trump coins and Melania coins. This move not only caused a shock in American politics, but also caused a huge wave in the field of cryptocurrency. This is not good news for practitioners and investors in the encryption industry. Many people worry that this behavior of the Trump family may provide new ammunition for those critics who accuse the cryptocurrency market of fraud and posing risks to consumers. After all, this high-profile and political token issuance may further aggravate market volatility and even attract more attention from the regulatory level. The Trump family, the biggest beneficiary of Trump coins According to reports, the Trump family holds 80% of the total supply of Trump coins through its company. Once the Trump coin was launched, it quickly became the 24th most valuable cryptocurrency in the world, and its market value once exceeded $80 billion, making the Trump family the biggest beneficiary of this round of skyrocketing. This also means that once the Trump family has any selling behavior, countless investors will lose their money. Nic Carter, the founding partner of cryptocurrency investment company Castle Island Ventures, bluntly criticized the move as "ridiculous" and warned that if investors suffered losses, it would have a negative impact on Trump himself and the entire cryptocurrency industry. Although Trump promised not to make new transactions during his term of office before his first term, his eldest son Donald Trump Jr and his second son Eric Trump have started to set foot in the field of cryptocurrency and set up their own company, World Liberty Financial. However, according to the analysis of blockchain analysis company Arkham, the Trump family did not sell Trump coins worth 500 million US dollars, but held a liquidity pool of about 500 million US dollars in the blockchain. The Trump family withdrew $20 million in USDC (a stable currency) from the liquidity pool and sent $92 million worth of Trump coins to the exchange. At present, there are about 370 million USDC in the liquidity pool, which means that the Trump family still holds most of the funds in the liquidity pool. Using the presidency to collect money? In addition, this move by the Trump family has also raised questions about whether it will use the incoming presidency to serve its own commercial interests. Anthony Scaramucci, founder of Tianqiao Capital, believes that the Trump couple's behavior is extremely unfavorable to the cryptocurrency industry, saying that this behavior is "self-deception" and suggesting that there may be deeper corruption behind it. Nick Tomaino, the founder of 1confirmation, criticized that this is predatory and many people may be hurt. Trump should airdrop to the people, instead of using this to make himself or his team rich. Ben Meiselas, co-founder of Meidas Touch, believes that Trump should focus on more urgent matters instead of focusing on launching Meme coins. Qiao Wang, co-founder of AllianceDAO, believes that Trump can announce the use of tokens for some fiscal policy, such as purchasing Greenland, assisting Los Angeles or upgrading the power grid. If we choose this road, cryptocurrency will be given more positive significance, regarded as the greatest capital formation mechanism in history, and its use will be widely recognized as a measure to benefit society, thus opening the golden age of cryptocurrency. However, if Trump chooses to do nothing and just use tokens to continue to accumulate wealth for himself, then this behavior will be regarded as a crime. Risk warning and exemption clause The market is risky and investment needs to be cautious. This paper does not constitute personal investment advice, nor does it take into account the special investment objectives, financial situation or needs of individual users. Users should consider whether any opinions, viewpoints or conclusions in this article are in line with their specific situation. Invest accordingly at your own risk.
2025-01-20 -
View detailsThe "bond market storm" triggered global panic, but the pain may have just begun.
The yield of US Treasury bonds has soared, and the yield of 10-year Treasury bonds has soared by more than 100 basis points in four months, which is now approaching the psychological threshold of 5%. This is a rare scene since the global financial crisis in 2008. The economic policy pursued by Trump after his return to the White House further pushed up the demand for loans. Its growth-oriented policy direction, including tax cuts and deregulation, has worried the market about the risks brought by soaring government debt. Kathy Jones, chief fixed income strategist of Charles Schwab & Co Inc, said in an interview with Bloomberg on Friday: In addition to monetary policy, fiscal policy has become an important factor affecting the bond market. The Trump administration's policies such as tax cuts and increased infrastructure spending may further expand the fiscal deficit, causing investors to worry about the sustainability of US debt. The "bond market police" has once again become the focus of discussion. Albert Edwards, global strategist at Societe Generale, said: 4.5% is just the beginning? Analyst: The era of high interest rates will be fully opened. Peters of PGIM Fixed Income said that if the 10-year yield rose above 5% in this environment, he "wouldn't be completely shocked". JPMorgan Chase pointed out that factors such as de-globalization, aging population and increased expenditure on climate change will push the yield of 10-year treasury bonds to remain above 4.5% for a long time. Bank of America believes that the bond market has entered the third "big bear market" in 240 years. "The steepening of the curve is also more in line with the historical relationship between the huge deficit and the rising deficit." In any case, this wave of adjustment in the global bond market has profoundly changed the investment environment. For investors and policy makers, adapting to the new normal may be the only option at present. The market is risky and investment needs to be cautious. This paper does not constitute personal investment advice, nor does it take into account the special investment objectives, financial situation or needs of individual users. Users should consider whether any opinions, viewpoints or conclusions in this article are in line with their specific situation. Invest accordingly at your own risk.
2025-01-13 -
View detailsMigrant workers' canteen sprints Hong Kong stock IPO
In the past few years, Chinese fast food restaurants opened on the first floor of office buildings and major shopping malls are becoming canteens for many migrant workers, and Hometown Chicken is one of them. Recently, LXJ International Holdings Limited, the holding company of Anhui Laoxiang Chicken Catering Co., Ltd., submitted a prospectus to the Hong Kong Stock Exchange, intending to be listed on the main board of the Hong Kong Stock Exchange, with CICC and haitong international as co-sponsors. Nowadays, the hometown chicken with thousands of stores has a relatively grassroots entrepreneurial story. The earliest story has to start from forty years ago. In 1982, 20-year-old Shu Congxuan retired and returned to his hometown of Feixi County, Hefei, Anhui Province, and began to invest in chicken raising. After raising chickens for 20 years, combined with the delicious Feixi old hen soup from his hometown, Shu Congxuan began to enter the catering industry, focusing on his own chickens. And this Feixi old hen soup is still the signature item of old country chicken today. In 2003, the first store of Feixi Old Chicken, the predecessor of the hometown family, opened in Shucheng Road, Hefei; Eight years later, it has grown into a hundred-store brand in Anhui. But the old country chicken is not satisfied with this. In 2012, with the tide of rising restaurant chain rate in China, "Feixi old hen" also planned to go out of Anhui and officially changed its name to "hometown chicken". Since then, the stores of Laoxiang Chicken have spread all over East China, and they started to join in 2020. It was the opening and expansion of Zhang Zhilu that made the stores grow even faster. According to the data published in the prospectus, as of September 30, 2024, Laoxiang Chicken had 1,404 stores in 53 cities in China, including 949 direct stores and 455 franchise stores, serving more than 189 million customers. At the key point of capitalization, Laoxiang Chicken has a bigger story, namely "the biggest Chinese fast food brand in China". If we only look at the transaction volume, its transaction volume in 2023 will reach 6.2 billion, which really ranks first in the Chinese fast food industry in China. From its financial point of view, its volume is not small. In terms of revenue, in 2022, 2023 and the first three quarters of 2024, the revenue of Laoxiang Chicken was 4.528 billion yuan, 5.651 billion yuan and 4.678 billion yuan respectively; In terms of net profit, the net profit of the above three periods was 252 million yuan, 375 million yuan and 367 million yuan respectively. Moreover, as a thousand-store brand from chicken breeding, its prospectus shows that Laoxiang Chicken has three chicken farms in Anhui with a total area of about 920,700 square meters, two central kitchens in Hefei and Shanghai, and eight distribution centers that support the operation of restaurants. Although it has been regarded as the seed player of Chinese fast food track in the past two years, there are still many hidden concerns about its performance. First of all, from the perspective of growth rate, the growth rate of revenue and profit of Laoxiang Chicken has slowed down. In 2023, the revenue growth rate of hometown chicken was 24.80%, and in the first three quarters of this year, the growth rate was only in the early 10%; In terms of profit, the year-on-year increase in 2023 was 9%, and it dropped by 1 percentage point in the first three quarters of 2024. And such an increase, in the case of a single store, can only be regarded as a slight increase. In addition, starting from 2022, the hometown chicken, which has reached the scale of thousands of stores, began to plan IPO. However, three sprints to the A-share IPO ended in failure. During that time, various compliance problems in the operation of hometown chicken also surfaced. According to the inquiry of Shanghai Stock Exchange, the problem of hometown chicken is more than a half-star, involving 45 aspects, such as employee social security, food safety, leasing collective land, bribery of actual controllers, asset transfer and the reasons for the difference in gross profit margin with comparable companies. As a Chinese restaurant head brand with a valuation of about 18 billion yuan in the Pre-IPO round at that time, each of these problems is a fatal blow. So at the end of August, 2023, the hometown chicken, who had already arrived in front of the IPO, took the initiative to withdraw the A-share listing application, which also meant that the last sprint in the A-share market officially failed. Judging from the current situation, the old country chicken has not given up. This time, the hometown chicken responded that listing on the Hong Kong Stock Exchange would give it global recognition and provide the hometown chicken with direct access to overseas investors and foreign capital. The raised funds will be used to strengthen the integrated supply chain layout; Expand the store network to expand the geographical coverage and deepen market penetration; Improve information technology capabilities and upgrade intelligent equipment and digital systems. However, it is not easy for hometown chickens to switch to Hong Kong stocks. On the one hand, it is hard to say whether the matters inquired by the Shanghai Stock Exchange have been solved or will become a constraint when the above-mentioned A-shares are rushed. From the financial point of view, Laoxiang Chicken does not have the scenery of "the largest Chinese fast food brand in China". Among them, increasing income without increasing profit is its biggest contradiction. Hometown Chicken has more than 1,400 stores, and its profit in the first three quarters of this year was 367 million yuan. However, last year, there were less than 1,000 other Huizhou catering small vegetable gardens, but by August 31, 2024, the income for the eight months was 3.544 billion yuan, and the net profit was 400 million yuan, which was much higher than that of hometown chickens. In today's business world, there are many grassroots entrepreneurial stories, especially in the catering industry. However, when it comes to the key nodes of the capital market, all families also need more standardized management and more modern management methods. It seems that it is always difficult to get through the "declaration of illness" and "getting lucky". The previous sprint story of Laoxiang Chicken is the best example. Now that the IPO of Hong Kong stocks is under attack, the hometown chicken should learn from the previous lessons, and it is possible to realize the dream of IPO and become the "first Chinese fast food". Risk warning and exemption clause The market is risky and investment needs to be cautious. This paper does not constitute personal investment advice, nor does it take into account the special investment objectives, financial situation or needs of individual users. Users should consider whether any opinions, viewpoints or conclusions in this article are in line with their specific situation. Invest accordingly at your own risk.
2025-01-09 -
View detailsHoward marks: is there a bubble in the us stock market now?
At present, Wall Street is full of arguments about the "bubble of US stocks". Howard Marks, a well-known investment guru, thinks that the valuation may be a little bubble but it doesn't seem crazy. On Tuesday, Howard Marks, the founder of Oak Capital, published a column in the Financial Times to explore whether the current US stock market has fallen into a bubble. Max thinks: Although the expected P/E ratio of the S&P 500 index is high, it is not crazy, at 23.6 times. I haven't heard people say "there is no unattainable price", and the market is not crazy in my opinion, although the price is high and there may be some bubbles. Marx pointed out in the article that the exact symbol of the bubble is irrational bubble thinking: Compared with the valuation parameters, the more effective way to judge the bubble is psychological diagnosis. The highly irrational prosperity-the complete worship of a group of companies or assets leads people to be extremely afraid of missing the opportunity to participate in the bubble, and firmly believe that these stocks "have no unattainable price", especially when the latter is the exact sign that the bubble is brewing. Max also said that bubbles are often related to "new things", and excessive optimism about new things will lead to pricing errors: Because bubble participants can't imagine any negative effects, they usually give a valuation of hypothetical success. In fact, only a few newcomers may flourish or even survive. An excellent newcomer may be replaced, and subversive may also be subverted. The following is the full text of the column: Nowadays, many investors are on high alert to asset price bubbles, fearing that past booms and busts will repeat themselves. Therefore, I am often asked whether there is a bubble around the few stocks that lead the Standard & Poor's 500 Index. The so-called "seven giants" of science and technology have dominated the index in recent years and contributed a disproportionate increase. You can identify bubbles by valuation parameters, but I always think psychological diagnosis is more effective. What I am looking for is a highly irrational prosperity-the complete worship of a group of companies or assets, which leads people to be extremely afraid of missing the opportunity to participate in the bubble and firmly believe that there is "no unattainable price" for these stocks. Especially when I hear the latter, I think it is a definite sign that a bubble is brewing. In short, bubbles are marked by bubble thinking. If bubble thinking is irrational, what makes investors deviate from rational thinking? The answer is simple: new things. This phenomenon depends on another time-honored investment motto "This time is different". Bubbles are always associated with new mistakes, from the Dutch enthusiasm for newly introduced tulips in the 1630 s to the Internet and telecommunications stocks in the late 1990 s. Since there are no historical indicators to measure the proper valuation of new things, nothing can anchor them on a solid foundation. All the bubbles I have experienced involve innovation, many of which are either overvalued or not fully understood. The attraction of new products or new business models is usually obvious, but the potential risks and loopholes are often hidden. A new company may completely surpass its predecessors, but investors often fail to realize that even a promising newcomer may be replaced, and disruptors may be subverted, whether by highly skilled competitors or updated technologies. In the 1990s, investors were convinced that "the Internet will change the world". It did seem so at the time, and this assumption led to a great increase in demand for everything related to the Internet. E-commerce stocks went public at a seemingly high price, and then tripled on the first day. There is usually a trace of truth behind every craze and bubble, but some of them are exaggerated. The Internet did change the world, but most Internet companies that soared in the bubble in the late 1990s were ultimately worthless. Excessive optimism about new things leads to wrong pricing. Because bubble participants can't imagine any downside risks, they often give a hypothetical successful valuation. In fact, only a few newcomers may thrive or even survive. Stocks are sold at multiples of the next year's earnings, reflecting the expectation that they will continue to make profits for many years to come. When you buy a stock, you buy the company's share of future annual income. When buying stocks at above-average P/E ratio, investors are paying for the company's profits in the coming decades, even considering the significant growth. Today, the companies leading the S&P 500 index are much better than the best companies in the past in many ways. They enjoy great technological advantages and scale, but their persistence is not easy to achieve, especially in high-tech fields that are easily subverted. In the bubble, investors treat leading companies as if they were sure to stay ahead for decades. Some did, some didn't, but change seems to be more common than persistence. Is the US stock market too high? It is extremely rare for the S&P 500 index to return 20% or more for two consecutive years. This has happened in the past two years. In 2023, the S&P 500 index rose by 24.2%, in 2024 it rose by 23.3%, and now we are in 2025. What will happen in the future? Today's warning signs include the optimism that has prevailed in the market since the end of 2022, the enthusiasm for the new thing of artificial intelligence, and the assumption that the top seven companies will continue to succeed. On the other hand, although the expected P/E ratio of the S&P 500 index is high, it is not crazy, at 23.6 times. I haven't heard people say "there is no unattainable price", and the market is not crazy in my opinion, although the price is high and there may be some bubbles. Risk warning and exemption clause The market is risky and investment needs to be cautious. This paper does not constitute personal investment advice, nor does it take into account the special investment objectives, financial situation or needs of individual users. Users should consider whether any opinions, viewpoints or conclusions in this article are in line with their specific situation. Invest accordingly at your own risk.
2025-01-08 -
View detailsRare! Federal Reserve officials directly commented on the US market: the valuation is too high and it is easy to fall sharply.
Former Federal Reserve Chairman Alan Greenspan warned of "irrational exuberance" in 1996. Now Federal Reserve Governor Lisa Cook has come forward to warn that "the valuation of US stocks is too high", and it is very rare for Fed officials to directly warn the market risks. According to MarketWatch, on Monday, Federal Reserve Governor Lisa Cook issued a rare direct warning to the stock market. She said: Many asset classes are at high valuations, including the stock and corporate bond markets, and the risk premiums in these markets are expected to be close to the bottom of the historical distribution. This means that the market may be perfectly priced, so it is prone to a sharp decline, which may be caused by bad economic news or changes in investor sentiment. This remark is reminiscent of the "irrational prosperity" warning put forward by former Federal Reserve Chairman Alan Greenspan in 1996, but unlike Greenspan's remarks that immediately affected the stock market, Cook's warning seems to be ignored by the market. On the same day, the S&P 500 index stood at 6000 points again, which was close to a record high. Although the increase later narrowed, it still closed at 0.6%. Undeniably, measured by historical standards, the market valuation is indeed at a historical high from a number of indicators: According to Goldman Sachs, the ratio of the S&P 500 index to its book value and sales is two standard deviations higher than the average of the past 10 years. Economist Robert Shiller's cyclically adjusted price-earnings ratio (CAPE) is about 37, which is close to the highest level since the bursting of the Internet bubble. The Standard & Poor's 500 Index rose by at least 20% for the second year in a row last year. However, high valuation does not necessarily mean that the market is about to collapse. Just as Greenspan's warning occurred four years before the peak of the internet bubble, the high valuation state may last for a long time. Art Hogan, chief market strategist of B. Riley Wealth, said: Greenspan was not wrong, but he made the decision four years in advance, and since then officials seem to have been trying to avoid commenting on the valuation. At the same time, five of the 11 sectors of the S&P 500 index outperformed the broader market index at the end of 2024, indicating that the rally has begun to expand from the seven giants of science and technology. If this is the case, it may help alleviate valuation concerns. Almost every Wall Street strategist expects the stock market to rise. Even a few analysts who expect the stock market to fall, such as Barry Bannister of Stifel, say that besides valuation, other factors (such as economic deterioration) are needed to make the stock market pull back. At the same time, if the fundamentals begin to deteriorate, overvaluation may make the market fragile. Kevin Simpson, CEO of Capital Wealth Planning, said in a report on Monday: The fourth quarter earnings season will start next week, and we expect that (earnings) will become the focus. Investors will seek earnings growth to support the current valuation and analyze how the company responds to the Fed's interest rate cut. The market generally expects the growth rate of earnings per share to be close to 15% in 2025, which is more than twice the historical average. If the earnings season has any impact on expectations, especially those from large technology companies, it will aggravate people's concerns about valuation. Risk warning and exemption clause The market is risky and investment needs to be cautious. This paper does not constitute personal investment advice, nor does it take into account the special investment objectives, financial situation or needs of individual users. Users should consider whether any opinions, viewpoints or conclusions in this article are in line with their specific situation. Invest accordingly at your own risk.
2025-01-07 -
View detailsGoldman Sachs changed its mind! Reduce the target price of gold, and no longer expect to hit $3,000 at the end of the year.
The Fed's interest rate cut is slowing down, and the rise in gold prices is also slowing down? In their latest report, Goldman Sachs analysts Lina Thomas and Daan Struyven adjusted their gold price forecasts, pointing out that the slowdown of US monetary policy relaxation in 2025 will curb the demand for gold ETFs. Therefore, Goldman Sachs expects the gold price to reach $2,910 per ounce by the end of this year, instead of the previously expected $3,000 per ounce. Goldman Sachs also expects that as the Fed continues to cut interest rates, the price of gold will reach $3,000 per ounce in mid-2026. Considering that inflation in the United States will continue to decline, Goldman Sachs expects the Federal Reserve to cut interest rates by 75 basis points this year, which is lower than the previous forecast of 100 basis points-however, this is still more dovish than the current market pricing. Goldman Sachs pointed out that the inflow of gold ETF funds in December last year was lower than expected, mainly due to the reduced uncertainty after the US election, which also led to the low starting point of gold prices at the beginning of this year. Analysts said: "The weakening of speculative demand and the structural increase of the central bank offset each other, making the price of gold fluctuate within a range in recent months." Goldman Sachs analysts also stressed that the central bank's willingness to buy gold will continue to be a key driver of the long-term price of gold. It is estimated that by mid-2026, the average monthly gold purchase will remain at 38 tons. Previously, in mid-November, the Struyven team had issued a document predicting that the price of gold would rise to $3,000/ounce by the end of 2025. The structural driving factor for the price increase came from the central bank's demand, the cyclical driving factor came from the Fed's interest rate cut, and the main downside risks came from the upward interest rate and the strengthening of the US dollar. In 2024, the price of gold rose by 27%, hitting a record high. This wave of gains is supported by factors such as the relaxation of US monetary policy, the increasing demand for safe haven and the continuous purchase of gold by global central banks. However, since the beginning of November last year, the gold rally has slowed down, mainly due to the impact of Trump's victory in boosting the dollar. Recently, as Fed officials stressed the need to cut interest rates more cautiously this year to deal with inflation concerns, gold prices began to come under pressure. Risk warning and exemption clause The market is risky and investment needs to be cautious. This paper does not constitute personal investment advice, nor does it take into account the special investment objectives, financial situation or needs of individual users. Users should consider whether any opinions, viewpoints or conclusions in this article are in line with their specific situation. Invest accordingly at your own risk.
2025-01-06 -
View detailsBe alert! Bank of America's important indicators of US stocks are only one step away from triggering the
Since the end of 2022, the S&P 500 index has risen by about 60%. Bank of America's indicator of tracking Wall Street's views on the US stock market is gradually approaching a "reverse sell" signal. Bank of America strategist Savita Subramanian and her team pointed out in a report to customers on Thursday: Bank of America's "Sell-Side Indicator SSI" rose by 33 basis points to 57% in December, the highest level since the beginning of 2022. The indicator is still in the "neutral" range, but it is only 1 percentage point away from triggering the "sell" signal. It should be noted that the last time SSI was so close to sending a "sell" signal was in February 2021, and then US stocks peaked 10 months later. This indicator has not declined for eight consecutive months, which is the longest continuous increase record since 2021. Subramanian also said: "Although more and more bullish voices will increase the risk of market complacency, our data show that bullish sentiment may remain at a high level for a long time before the bull market ends." SSI is a reverse indicator, which tracks the advice of Wall Street sellers' strategists on the average allocation ratio of stocks in balanced funds. When Wall Street is extremely bearish, it means that the stock market can be bullish in the future, and vice versa. According to the previous article of the Wall Street News website, according to the prediction of 16 Wall Street investment banks counted by Opening Bell Daily, each investment bank predicted that US stocks would continue to rise in 2025, and the cumulative increase of the S&P 500 index is expected to be 7%-19%. This also includes Bank of America. The bank's end-of-year target price for the S&P 500 index in 2025 is 6666 points, which means that there is still about 13% upside compared with the closing on December 31. On Thursday, January 2nd, on the first trading day of US stocks in 2025, the market performance was quite unsettled. Although the stock index opened higher before the session, it went down and pulled up several times in the session, and the long-short game was fierce. Risk warning and exemption clause The market is risky and investment needs to be cautious. This paper does not constitute personal investment advice, nor does it take into account the special investment objectives, financial situation or needs of individual users. Users should consider whether any opinions, viewpoints or conclusions in this article are in line with their specific situation. Invest accordingly at your own risk.
2025-01-03 -
View detailsHong Kong's IPO this year is expected to be 150 billion, the top three in the world.
Figure: Overview of potential large-scale new shares and fund-raising amount this year. In 2024, the new stock market began to recover, and in the second half of the year, many large-scale new stock listings were recorded continuously, which greatly improved the market atmosphere. In its annual review, HKEx concluded that there were 66 IPOs in Japan as of December 20, raising a total of 83 billion yuan, making it one of the four largest IPO markets in the world. Based on the data of many accounting firms, the number of new shares will further rise to 80 in 2025, and the amount of funds raised can reach 100 to 150 billion yuan, which is expected to hit the top three in the world. Last year, the trend of "A before H" rose and added vitality to the IPO market. In April, the China Securities Regulatory Commission issued five measures for capital market cooperation with Hong Kong, and mentioned that it supported leading mainland enterprises to go public in Hong Kong. Subsequently, Midea Group (00300), a leading domestic appliance company, which was listed on the A-share market, successfully went public in September. After fully exercising its over-allotment rights, it raised a total of 35.7 billion yuan, which was the largest IPO in Hong Kong after 2021. Statistics show that after Midea's listing, the number of "A+H" shares in Hong Kong reached 149. The market is booming. Last year, many cases were overbought thousands of times. Apart from Midea, Hong Kong also recorded three new shares that raised over 5 billion yuan last year, namely SF Holdings (06936), China Resources Beverage (02460) and Horizon Robot (09660). According to Deloitte, the accounting firm, the top five IPOs raised 56 billion yuan last year, up 227% year-on-year. In 2024, the new wave picked up. Based on the data of Deloitte and HKEx, Caoji Group (02593) became the "overbought king" last year with 6082.6 times of oversubscription, followed by Jingke Electronics (02551) with an oversubscription multiple of 5676.8 times, followed by Youbo Holdings (08529), Yuanxu Technology (08637) and carote (08637). In contrast, in 2023, Zhongxu Future (09890), the "overbought king", was only oversubscribed by 103 times, reflecting that the new share subscription mood was greatly improved in 2024. It is not only the market atmosphere that has improved, but also the issuance of 18C and Special Purpose Acquisition Company (SPAC) has made progress. In 2024, three 18C new shares were ushered in, namely Jingtai Holdings (02228), Black Sesame Intelligence (02533) and Yuejiang (02432). In addition, Xidi Zhijia, which has submitted a prospectus, also applied for listing under 18C regulations; The acquisition of Huide initiated by Chen Delin, former president of HKMA, became the first SPAC company to complete the De-SPAC transaction, and it was renamed Shi Teng Holdings (02562). Optimize the increment of listing application approval During the period, a number of IPO market reforms were ushered in. The mechanism of treasury shares officially implemented in June last year helps issuers to repurchase shares and resell treasury shares, providing issuers with greater flexibility in capital management; Subsequently, in August, the CSRC and the Hong Kong Stock Exchange announced a three-year short-term revision of the new listing rules for 18C and SPAC, in which the revision involving 18C lowered the minimum market value requirements of commercial and non-commercial specialized technology companies by 2 billion yuan respectively. In addition, in October last year, the CSRC and HKEx optimized the timetable for the approval process of new listing applications, including speeding up the approval of qualified A-share companies and providing greater certainty and transparency for prospective applicants and their consultants in formulating listing plans; In December, HKEx also conducted a three-month consultation on optimizing IPO pricing and open market regulations, which involved adjusting the existing six-month lock-up period of cornerstone investors to 50% every three months.
2025-01-02