Market Highlights 💡 - 17 January 2025

Wall Street closes lower due to tech sector sell-off

🇺🇸 S&P 500 Index: -0.21% 📉

🇺🇸 Nasdaq: -0.89% 📉

🇪🇺 STOXX 600 Index: 0.99% 📈

🇯🇵 Nikkei 225 Index: 0.33% 📈

🇭🇰 Hang Seng Index: 1.23% 📈

🇨🇳 CSI 300 Index: 0.11% 📈

🇸🇬 Straits Times Index: 0.76% 📈

U.S. Stock Market Stalls: The S&P 500 and Nasdaq Composite both dropped by -0.2% and -0.9%, respectively, dragged down by a tech sector sell-off, while dovish comments from Federal Reserve officials boosted the bond market.

U.S. Retail Sales in December 2024 rose by 0.4% month-over-month, the smallest increase in four months, below the 0.6% forecast, though the data still shows strong consumer spending.

U.S. Jobless Claims increased to 217,000, exceeding expectations, but remained below the average levels seen in the second half of 2024, reflecting the resilience of the labor market, which supports the Fed's hawkish stance.

Asia-Pacific stocks soared on Thursday, with the Hang Seng Index rising 1.2% to a two-week high, following a slowdown in U.S. core inflation. The market had optimistic expectations of interest rate cuts, while the CSI 300 Index rose by 0.1%.

Future Events:

On Friday, China will release a series of data, including GDP quarterly growth, industrial production year-over-year, retail sales year-over-year, and unemployment rate.

Things to Know Today:

1. Federal Reserve Governor Christopher Waller: “As long as inflation data is good or continues to show that trend, I can fully foresee interest rates being lowered sooner than the market expects.”

Christopher Waller

2. U.S. President-elect Donald Trump's pick for Treasury Secretary, Scott Bessent: “I believe the U.S. has no need to launch a central bank digital currency. In my view, central bank digital currencies are intended for countries with no other investment options.”

Scott Bessent

3. TikTok's prospects have improved, as U.S. officials, including President Trump's soon-to-be National Security Advisor and Senate Democrat Chuck Schumer, advocate for extending the sale deadline to avoid a ban, ensuring the app continues to serve 170 million Americans.

TikTok ban in US

4. UnitedHealth's $UnitedHealth(UNH)$  Q4 2024 revenue fell short of expectations due to weak insurance business and higher-than-expected healthcare costs. The annual medical loss ratio rose to 85.5%, higher than the expected 84.96%. The stock dropped -6.0% on Thursday.

UnitedHealth

5. China announced an investigation into U.S. semiconductor subsidies, claiming they harm mature-node chip manufacturers, which produce cost-effective chips used in household appliances and communication systems for simple tasks.

CHINA - US Chip war

Key Takeaways:

The upcoming Q4 2024 U.S. earnings season will shift investor focus from macro data to micro-level performance. The market's reaction to earnings surprises will be closely watched, as high valuation environments make the market more sensitive to underperforming results.

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