Last Week's Recap
The US Market - another volatile week
The stock market started and the week ended with Trump tariff fears hitting the indexes, offsetting gains in the middle of the week. Treasury yields hit 2025 lows, but rebounded somewhat, on Friday's mixed jobs report and hot inflation expectations.
President Donald Trump said on Friday he plans to announce reciprocal tariffs on many countries next week, a major escalation of his trade war. Trump did not identify which countries would be hit but suggested it would be a broad effort that could also help solve U.S. budget problems.
The January jobs report headline flashed lackluster hiring with 143,000 new jobs, including 111,000 private sector jobs. But winter weather and the Los Angeles fires may have been a factor. And the unemployment rate fell to 4%, the lowest since May.
The US Sectors & Stocks - 2/3 S&P 500 companies resulted in strong earnings
7 out of 11 sectors traded positive on the week. The consumer defensive and basic materials sectors closed out the week with more than a 1% gain. The consumer cyclical stocks were the worst-performing sector with a 2.7% weekly plunge, followed by the communication services sector, down 1.2%.
Nearly two-thirds of the companies in the S&P 500 have reported their quarterly earnings this cycle. Their results indicate a strong earnings picture and outlook.
Many post-earnings S&P 500 companies have notched fresh all-time highs. Among financial sectors, JPMorgan (JPM)、Goldman Sachs (GS)、Morgan Stanley (MS)、Citi group (C) and more banks traded at all-time-high levels. The consumer defensive stocks Walmart (WMT)、Costco (COST) and Philip Morris(PM) also hit new highs. Otherwise, Netflix (NFLX) and Meta platform (META) were the same.
Palantir Technologies (PLTR) skyrocketed 34% over the week, pushing its marketcap to over $250 billion. The AI player's Q4 revenue registered the sixth straight quarter of accelerating growth with strong U.S. commercial and government gains. The data analytics software maker guided solidly higher on 2025 revenue.
Google-parent Alphabet (GOOGL) sold off on a higher-than-expected 2025 capital spending outlook, despite its Q4 earnings beat. Ad revenue beat, but cloud revenue came in light. Alphabet forecast capital spending of $75 billion in 2025, up 43%, well above views for $59 billion.
Amazon (AMZN) fell on weak guidance. Both revenue and EPS beat the expectations. But its outlook for sales and operating income for Q1 2025 came in below expectations, with Amazon blaming a strong dollar. Like other tech titans, Amazon plans heavy capital spending in 2025.
Affirm (AFRM) soared 23% as the "buy now, pay later" company reported fiscal Q2 adjusted EPS of 23 cents, beating analysts' estimates that called for a loss of 16 cents. Revenue of $866 million also topped consensus of $807 million.
Uber Technologies (UBER) rebounded more than 10% after Bill Ackman disclosed on X that his hedge fund Pershing Square had built a position in the ride-hailing company and now holds 30.3 million shares, a stake valued at more than $2 billion.
Expedia (EXPE) reported Q4 results well above analysts' estimates and its shares rose 18%. The company said bookings rose in all three of its core consumer brands.
Cloudflare (NET) reported Q4 earnings and revenue that beat Wall Street forecasts and issued 2025 revenue guidance of $2.09 billion that met expectations. The cloud computing company stock jumped 20% higher.
Take-Two Interactive Software (TTWO) rose 12% after reporting a narrower-than-expected fiscal Q3 loss. CEO Zelnick stated that really excited for the rest of the year.
Doximity (DOCS) soared 34%. The maker of software for medical professionals posted fiscal third-quarter earnings that topped analysts' estimates and raised its fiscal-year outlook.
Pinterest (PINS) jumped 21% after the photo-sharing platform posted better-than-anticipated Q4 revenue of $1.15 billion, its first billion-dollar revenue quarter.
Spotify (SPOT) beat analyst estimates for subscribers and users in the fourth quarter, sending shares soaring. The music streamer added 11 million premium subscribers, ending 2024 with 263 million worldwide. The shares jumped 13.5%.
Hong Kong Market - HSTECH rallied into a technical bull market
Hong Kong stocks advanced as gains in tech companies propelled the city’s benchmark index to its best weekly performance in four months. The Hang Seng Index (HSI) rose 4.5% from a week ago.
Chinese tech stocks have reaped the AI theme stemming from the emergence of DeepSeek for a week, helping narrow the valuation gap against their US tech peers, according to some money managers. The Hang Seng Tech Index (HSTECH) gained 22% from a January low, putting the members in a technical bull market.
Xiaomi (1810.HK) rose 11% las week after announcing a new electric vehicle (EV) and phone line-up. HSBC raised Xiaomi’s price target to HK$49.90 from HK$37.90, saying that it has become the biggest beneficiary of China’s subsidy programme.
Singapore Market - SGX hit a record high
Singapore's stock market ended the week in green, with the STI up 0.15% weekly. Singapore's foreign exchange reserves grew to SG$510.6 billion in January 2025 from SG$506.7 billion in December 2024, according to preliminary data from the Monetary Authority of Singapore.
SGX surged 10% on Friday to S$13.99, hitting a record high. The company reported on Thursday its highest ever half-year profit since going public, driven by strong performance across all its business segments, particularly cash equities and equity derivatives.
Australian Market - ASX 200 lost 0.2%
Australian shares fell short of closing at a record high on Friday as traders awaited key US jobs data that will shed light on the scope for further interest rate cuts by the Federal Reserve. The ASX 200 ended the week with a 0.2% loss but came 21 points from hitting a new peak.
Banks retreated before hitting record highs. Commonwealth Bank (ASX: CBA) set a new closing record, and leading the other banks ANZ (ASX: ANZ), NAB (ASX: NAB) and Westpac (ASX: WBC) to marginal positive closes as well.
The Week Ahead
Macro Factors - Inflation check
On Wednesday, BLS will publish the consumer price index for January. With the Federal Reserve's interest-rate cuts on hold, all eyes will be searching for signs of renewed progress in slowing inflation.
Wall Street economists expect January's CPI to show headline inflation of 2.9% in January, flat from the month prior. Prices are anticipated to rise 0.3% on a month-over-month basis, below the 0.4% increase seen in December. On a "core" basis, which strips out food and energy prices, CPI is expected to have risen 3.1% over last year in January, below the 3.2% seen in December. Monthly core price increases are anticipated to clock in at 0.3%, above the 0.2% seen the month prior.
The BLS will release the producer price index (PPI) for January on Thursday. The consensus call is for a 3.2% year-over-year gain, while the core PPI is seen rising by 3.3%. This compares with increases of 3.3% and 3.5%, respectively, in December.
Earnings
This week promises to be another busy one for the season, with 75 companies in the S&P 500 set to report. Many names in the travel industry are on the docket, alongside more restaurant and semiconductor companies.
With more than 62% of S&P 500 companies done reporting earnings, the year-over-year growth rate for the index keeps moving higher. As of Friday, the S&P 500 was pacing for earnings growth of 16.4% compared to the year prior. This would mark the fastest pace of growth in three years and is well above the 11.8% earnings growth analysts had expected at the start of January.
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