13/03/2025 Daily Reports
Asian Shares Stay Calm as Wall Street Lowers US Projections; Hong Kong Beats
- Asian shares bobbed in a narrow range on Thursday after months of market nervousness led Wall Street strategists to lower forecasts for US shares. Goldman Sachs, Citigroup, and HSBC have all warned of worse US equity performance with Citi moving China up to overweight as investors seek out substitutes in the Asia-Pacific market.
- Hong Kong’s Hang Seng Index has gained 21% since President Donald Trump took office, the world’s top-performing major index. The city’s stock exchange is now considering lowering investment thresholds to further boost trading activity.
- Meanwhile, trade tensions continue to escalate, with Trump warning reprisals against the European Union’s retaliatory tariffs to his new 25% tariffs on steel and aluminum. Canada further slapped new tariffs on $20.8 billion of US goods in retaliation.
- In Washington politics, Senate Democrats filibustered a Republican spending bill, putting the threat of a government shutdown on the table. But JPMorgan strategists note that the worst of the US stock market correction may be in the rearview mirror, with still-prevailing ETF inflows and soothing credit fears.
- Other places, Japan’s yen flirted with weakness as Bank of Japan officials remained absent from the markets even as bond yields rose to their 2008 high.
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Tech Stock Turmoil: Sell-Off Extends Beyond the 'Magnificent 7'
- The recent market downturn has hit tech stocks hard, not just the “Magnificent 7” (NVDA, TSLA, GOOG, AMZN, META, AAPL, MSFT), but also other high-flying names.
- Stocks like Netflix (NFLX), AMD (AMD), Micron (MU), Dell (DELL), and Palantir (PLTR) have suffered significant losses in recent weeks.
- Netflix has dropped 15% from its recent highs, while Palantir is down 30% from its record close in February. Dell has tumbled nearly 50% from its peak.
- Chipmakers, including AMD, Micron, Super Micro (SMCI), Intel (INTC), and ON Semiconductor (ON), have all plunged over 40% from their 52-week highs.
- The AI boom that fueled these stocks is facing increasing skepticism, with rising competition and concerns over demand for AI chips. AMD’s weaker-than-expected growth forecast for its data center business has been a key disappointment.
- Tesla has been the biggest loser among the “Magnificent 7,” down nearly 50% from its peak. Even market giants Apple and Nvidia have seen losses between 16% and 25%.
- The sell-off highlights a possible market shift—Wall Street analysts are questioning whether tech stocks can continue to lead the way, or if other sectors will take over.
- What’s Next?: The market seems to be in a transition phase, where past winners may not continue to dominate. Investors should focus on quality companies with solid fundamentals rather than simply chasing past momentum.
AI and tech stocks might still offer long-term potential, but volatility will likely remain high in the near future.
