The “key” economic figures are all more or less out. We know the name of the new American President and the broad outlines of his program which is taking shape at full speed (and which is sometimes very scary). We know that customs tariffs will cost money and that tax measures will cost even more. But we also know that it will give Tesla a huge boost and put Uber into panic. And then we know that inflation remains very “touchy” and that the FED can no longer sleep, while knowing that “perhaps” it would no longer lower rates. So, with this mass of knowledge and skills, we sit on a chair while waiting for NVIDIA.
The Audio of November 19, 2024
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Nvidia
The quarterly publications of the king of artificial intelligence are scheduled for this Wednesday after the close. You know that because I’ve been talking to you about it for two weeks. But waiting for Wednesday’s releases and in the absence of economic releases or major speeches from people who matter, we spend most of the day sitting in a chair waiting for something to happen. The performance of the indices yesterday is clear proof: no one dares to do anything since Nvidia has the power to send the market in one direction or the other. Yesterday there were even announcements that the FAMOUS Blackwell chip – which is a bit the equivalent, in terms of revenue, of the iPhone at Apple – could have two or three technical problems, starting with the fact that it would overheat more than reason.
On the news, Nvidia fell 1.29%. No one dares to sell the title just in case the CEO of the Californian company found new superlatives to explain how fantastic, extraordinary, even wonderful their results are. No, the market is hanging on Wednesday’s numbers and in the meantime, no one is doing anything. Or not much. So yes, yesterday there was the Super Micro sketch; during the session Nvidia’s third largest customer announced that they were going to propose a recovery plan in order to be able to remain in the Nasdaq – on the announcement the stock gained 16% – and on the announcement of the details of the plan, after close, Super Micro exploded by 38%. These days, when I talk about Super Micro, we no longer talk about an investment, but rather a very, very high level “Muppet Show”.
Super Micro
So the company has found an audit firm that is willing to take the position with immediate effect. This is BDO taking the risk of taking up the job that no one wants because the ultra-family business is practically unmanageable and ethically “borderline”. However, this new actor in season 4 and episode eight of the fabulous story of Super Micro could allow the company to overcome the pitfall of Nasdaq regulations. The company also asked for more time to present its accounts – time for them to understand what is in them themselves and they could very soon present them to the authorities and investors.
Once again, in American finance, we were inspired by the greatest masterpieces of the house of Disney to present us with an almost perfect Happy Ending. All that remains is that the accounts in question hold up and that the people at BDO do not resign after three days of work discovering the abysmal number of problems that there are internally. In any case, Super Micro explodes after close and is now trading around $30. We are already looking forward to season 5.
Here and elsewhere
Yesterday’s session does not deserve to be included in the “Hall of Fame” of sessions of the decade. We can still talk about Telsa which ended up 5% after the announcement of the future Trump government which will favor autonomous vehicles as soon as it takes power. Telsa which is also up 40% since Kamala Harris was kicked by voters. We’re not going to go over the fact that Elon Musk’s accumulation of mandates is becoming a little bit weird, because at the moment that’s of no interest to anyone. On the other hand, we will still remember that with the announcement of robotaxis, Uber and Lyft were hit on the mere idea of seeing the competition arrive.
In other events of the day, there is Spirit Airlines which has completed the documents and is officially in “Chapter Eleven” and then there is also Microstrategy which announced that they bought 4.6 billion worth of Bitcoin at the average price approximately $88,627. Which represents a gain – on this purchase – of 3.8% at this morning’s price. The stock gained more than 10% on yesterday’s announcement and is up 50% since the election of Donald Trump, while Bitcoin itself is “only” up 38%. All this to tell you that all in all, the market does nothing while waiting for Nvidia’s figures – unless the European CPI figures change our lives this morning – but that inside the indices , there’s still a lot going on. We can even still talk about Palantir which asks to exit the Nasdaq to be listed on the NYSE and which loses 8% in the process, but apart from that, I would not venture to say that we are focusing on other than Wednesday evening, what worries me the most is knowing what we are going to do AFTER Wednesday evening. But in the meantime, let’s talk about Asia.
On the other side of the world
This morning the Asian markets are once again a little divided. On the one hand we have Japan which is up 0.6% while awaiting the CPI publications which are scheduled for the end of the week. The Japanese index is helped by the technology sector which is riding the American wave and also by the weakness of the yen which means that female exporters are well sought after. In China, Shanghai is down 0.6%, there we await the decision on interest rates. The goodwill of the People’s Bank of China which should decide on its reference rate during the week. Experts expect the rate to remain unchanged after a cut in October. The move comes as China’s recent stimulus measures have been largely disappointing and the economy has shown few signs of improvement. Inflation data for October showed that disinflation remained. At the same time, we will also note that Morgan Stanley and Goldman Sachs have turned their backs on China and returned to the bearish camp.
Analysts initially seemed optimistic after the first round of stimulus measures announced in September. Both bankers raised their recommendations on Chinese stocks in the weeks that followed, with Goldman Sachs moving to “overweight”, while Morgan Stanley, who were negative, became neutral. Well, it didn’t last long because in recent days, we are very cautious again and everyone is arguing about customs taxes which could further slow down a Chinese economy which is already in bad shape. While Shanghai is moving backwards this morning, Hong Kong is doing nothing, or not much. Bitcoin is at $91,500, gold has rebounded from $2,600 and is trading at $2,625. On the other hand, it’s a samba on the barrel side, since WTI rose by $2 and is now trading at $69 per barrel. It must be said that Joe Biden’s rantings about Ukraine have reignited international tensions.
We will note Zelensky who puffs out his chest saying that the “bombs will speak for themselves” and the Russians who scream aggression from NATO and who threaten reprisals which will hurt a lot. If you search carefully on the internet, you can already find simulations of a nuclear attack on kyiv which are very encouraging – but which raise the bar. And to be completely complete, we should also note that Norway’s largest oil field, located in the North Sea, was closed after an electrical incident. The Norwegian public company Equinor has indicated that its teams are working to restore power to the offshore platform, but have no idea when this will be repaired – which creates a lot of uncertainty and we don’t like uncertainty. The site produces around 755,000 barrels per day when operating.
The new news
As for the rest of the news to remember, there really isn’t much as everyone counts down the hours until Wednesday evening. But we will remember that Madame Lagarde spoke yesterday in Paris to encourage European leaders to fight in a united Europe, she declared:
“By acting as a union to increase our productivity growth and pooling our resources in areas where our priorities closely converge, such as defense and ecological transition, we can both achieve the results we want and effectively manage public expenditure.
Well good luck, already inside the countries of Europe it’s every man for himself, the German Chancellor is going to get fired, Meloni is riding for her, Spain is managing its floods and meanwhile, the King of France tours South America with his grandmother to give politics and economics lessons to everyone, while in his own country, farmers can no longer live properly. Not to mention that the unelected madwoman who runs Europe thinks she is the Queen of the World, we feel that the European Union is solid and that they are all fighting together… It should also be noted that in the framework of the anti-trust lawsuit against Google, there is talk of a Chrome spin-off, it seems that it will change everything. On the American employment side, one last bit of news for the road: The USA announces 55,597 job cuts in October, a jump of 51% compared to October 2023. This follows the 174,597 job cuts of jobs reported in the third quarter of 2024, i.e. 19% more than in the third quarter of 2023. Since the start of the year, announcements of job cuts jobs stand at 664,839, the highest number since the 2020 pandemic and apart from the COVID phase, planned layoffs have reached their highest level since the 2008 financial crisis. We want to know who is laying off workers in the USA, it’s tech, health and the manufacturing industry. Everything is going GREAT, as the stock indexes show, but Trump is going to have his work cut out!
Today’s numbers
Regarding today, we will first note that in 38 hours we will have the publication of Nvidia’s figures, that this morning there will be the European CPI and that this afternoon – in the USA – it There will be building permits. At the moment, futures are up 0.14% and everything seems very calm. Hopefully it lasts.
For my part, I wish you an excellent breakfast, a very good coffee and we will see you tomorrow for new adventures in which I will talk to you AGAIN about Nvidia. So: see you tomorrow, if you want!
Thomas Veillet
Investir.ch
“Without leaps of imagination or dreaming, we lose the excitement of possibilities. Dreaming, after all, is a form of planning.” ― Gloria Steinem
