December 9th Market Overview

Happy Monday everyone.

Markets are down today from last week's record highs. Mainly due to pressure in the tech sector and profit taking. Chinese regulators probed $NVDA for antitrust issues.

The timing of $NVDA's Chinese antitrust probe comes amid heightened U.S.-China trade tensions…seems odd?

China eases monetary policy stance for the first time in 14 years, and names like $BABA, $JD, etc. are ripping.

Let's dig in...

Executive Summary

• Chinese regulators launch antitrust investigation into $NVDA, threatening its 15% data center revenue from the region
  

• China announces first shift to “moderately loose” monetary policy since 2011, sparking rally in Asian markets and commodities
  

• Gold hits two-week highs on renewed Chinese central bank buying and geopolitical tensions
  

• Oppenheimer sets bullish 7,100 SPX target for 2025, citing 10% earnings growth and AI-driven productivity gains

Market Overview

All major indices posting solid gains today.

Key Market Drivers

1. Chinese Policy Shift: First “moderately loose” stance since 2011, promising proactive fiscal stimulus for 2025
   

2. Technology Sector Pressure: $NVDA investigation sparks broader tech selloff
   

3. Geopolitical Tensions: Syrian leadership crisis drives gold higher
   

4. Corporate Earnings: Multiple analyst upgrades and downgrades shaping sector movements

Stock Spotlight

• $NVDA ▼ 2.75%: Chinese regulators investigate potential antimonopoly violations; company generates $4.5B in Q3 China data center revenue
  

• $HSHY ▲ 13%: Shares heading for best day since June 2016 on potential
  
  $MDLZ acquisition interest
  

• $AMD ▼: Bank of America downgrades to neutral, cuts PT to $155 from $180 citing AI competitive risks
  

• $PLTR ▲ 6%: Expands U.S. Special Operations Command contract valued at $37 million

Big Name Updates

• $TSLA: Announces Model Q for 2025, targeting sub-$30,000 price point; Deutsche Bank raises PT to $370
  

• $AAPL: Plans in-house modem chip rollout starting with iPhone SE in 2025
  

• $MSFT: Secures UAE export clearance for advanced AI chips
  

• $AMZN: Reports insufficient demand for $AMD AI chips in AWS cloud offerings

Other Notable Company News

• $RDDT ▲ 5%: Morgan Stanley upgrades to overweight, raises PT to $200 from $70
  

• $HOOD ▲: Barclays upgrades to overweight, triples PT to $49
  

• $JD: Bernstein upgrade cites improving user engagement metrics
  

• $OMC: Advanced discussions to acquire $IPG in all-stock deal valued at $13-14B

Sector Watch

Bond Market

Treasury yields show cautious positioning ahead of Wednesday’s CPI report and next week’s Fed meeting.

Policy Watch

• Fed’s Daly emphasizes readiness to raise rates if inflation resurges
  

• Trump confirms no plans to replace Powell through 2026 term
  

• Citigroup revises December rate cut expectation to 25bps from 50bps

What to Watch

1. November CPI Report (Wednesday):

• Economists expect 0.3% MoM increase

• YoY forecast at 2.7%, up from October’s 2.6%

• Core inflation figures crucial for Fed policy path

2. Chinese Regulatory Actions:

• Impact on $NVDA's market position

• Potential spillover effects on other tech companies

• Policy implications for U.S.-China trade relations

3. Federal Reserve Meeting (Next Week):

• Updated dot plot projections

• 2025 rate cut trajectory

• Commentary on inflation trends
  
  
  Thanks for reading 🙂
  
  - John