Anti-Clickbait News Summaries for October 20, 2024
Tech leaders in Silicon Valley shift focus to US elections as regulatory concerns grow
Hi, itโs Jack again.
You can find my main newsletter at:
Listen:
Read:
Tech leaders in Silicon Valley shift focus to US elections as regulatory concerns grow
Elon Musk's recent appearance with Donald Trump highlights the growing political influence of tech leaders as they respond to increased regulation under the Biden administration. Many in Silicon Valley now see Trump as a preferable alternative to stricter oversight.
The Department of Justice's recent antitrust victory against Google has alarmed the tech industry. This ruling confirmed Google's monopolistic practices, prompting discussions among tech moguls about supporting Trump to counteract regulatory pressures.
Additionally, cryptocurrency companies have invested over $100 million in SuperPACs to support candidates aligned with their interests. This shift indicates a new level of political engagement among tech firms, contrasting with their previous indifference to politics.
Semiconductor industry poised for growth with TSMC and Arm Holdings leading the way
The semiconductor industry is expected to grow significantly, driven by demand for chips in various sectors, including AI technology. Statista forecasts a 10% annual growth rate, reaching $980 billion by 2029.
Taiwan Semiconductor Manufacturing (TSMC) is a leading foundry with a market cap nearing $1 trillion. Analysts predict a 26% revenue increase this year, supported by strong demand for high-performance chips, particularly for AI applications.
Arm Holdings, valued at about $159 billion, focuses on chip design and licensing. Its revenue grew 39% recently, and analysts expect earnings to rise 27% annually. Arm's energy-efficient chips are increasingly sought after, especially in data centers.
Source: https://finance.yahoo.com/news/2-surefire-chip-stocks-buy-092000986.html
US economy enters new supercycle with higher growth and inflation
The U.S. economy is shifting into a new "economic supercycle," marked by higher growth, increased inflation, and geopolitical instability. This change ends a long period of low interest rates and weak demand that followed the Great Recession.
Experts predict that this new era will feature higher interest rates, which will reward savers but make borrowing more expensive. Additionally, inflationary pressures are expected to rise due to economic volatility and national security concerns influencing supply chains.
Foreign investment in U.S. securities is increasing, as the U.S. economy is seen as a safer option compared to slower-growing regions like Europe and China. This new supercycle will require businesses and investors to adapt to changing economic realities.
New book reveals Trump and Putin's secret communications after presidency
New revelations about the relationship between Donald Trump and Vladimir Putin have emerged from Bob Woodward's recent book. It claims Trump maintained secret contact with Putin seven times since leaving office in 2021, including discussions about military aid to Ukraine.
During his presidency, Trump often defended Putin, questioning U.S. intelligence on Russian election interference. He also took actions against Russia, such as expelling diplomats and approving military aid to Ukraine, while still expressing admiration for Putin.
Trump continues to mention Putin frequently on the campaign trail, asserting a strong relationship that he claims could help negotiate peace in Ukraine. Critics argue this could lead to pressure on Ukraine to concede territory to Russia.
Source: https://ca.news.yahoo.com/trump-putin-really-feel-other-093000399.html
Amazon and Alphabet could reach $3 trillion market cap in next two years
Nvidia has seen its stock surge over 820% since 2022, reaching a market cap of nearly $3.3 trillion. It is now second only to Apple, which has a market cap of $3.5 trillion.
Amazon's market cap stands at $2 trillion, with analysts predicting a potential 50% increase in stock value over the next two years. The company has improved delivery efficiencies and reduced costs, enhancing its competitive position in e-commerce.
Alphabet, also with a market cap around $2 trillion, has doubled its stock value in five years. The company is gaining ground in the cloud market, driven by strong demand for AI services, and could see its market cap reach $3 trillion within two years.
Qualcomm set to unveil Snapdragon 8 Gen 4 chip at upcoming summit
Qualcomm will unveil its Snapdragon 8 Gen 4 mobile chipset at the Snapdragon Summit starting October 21. This new chip aims to compete with Apple's A18, which has recently shown strong performance in benchmark tests.
The Snapdragon 8 Gen 4 will feature a new Oryon CPU, replacing the previous Kryo CPU. Leaked benchmarks suggest it may outperform the Snapdragon 8 Gen 3 and come close to the A18 in single-core performance, while exceeding it in multicore tests.
The Summit will also address Qualcomm's automotive and connected computing initiatives. While Samsung's plans for the Snapdragon 8 Gen 4 remain unclear, it is expected to appear in future devices like the Galaxy S25 and OnePlus 13.
Mastercard prepares to report third-quarter results as analysts compare performance with Visa
Mastercard will report its third-quarter results soon, following a year of slight underperformance compared to Visa. This upcoming report is important for assessing Mastercard's market position relative to Visa.
Analysts are closely watching how Mastercard's performance may affect its valuation compared to Visa. The results could influence investor sentiment and market dynamics in the payments sector.
Trump opens Pennsylvania rally with unexpected remarks about Arnold Palmer
Donald Trump held a rally in Latrobe, Pennsylvania, where he began by discussing golfer Arnold Palmer in detail, including personal anecdotes. This marked a shift from his campaign's intention to preview closing arguments ahead of the upcoming election.
While Trump eventually addressed his usual campaign themes, he did not provide new insights on his candidacy. He criticized Vice President Kamala Harris, calling her the "worst vice president" and referencing her past stance on hydraulic fracking.
Trump also mentioned a recent call from Israeli Prime Minister Benjamin Netanyahu amid ongoing conflict in Gaza. He noted increased security measures around him, referencing past assassination attempts, and made light of the situation by comparing security personnel to Arnold Palmer.
LVMH reports first revenue decline since pandemic raising concerns for luxury sector
LVMH reported disappointing third-quarter earnings, with a 3% revenue decline and a significant drop in sales from its fashion and leather goods sector. This marks the first decline since the pandemic, raising concerns for the luxury market.
Sales in China fell 16% year-over-year, reflecting low consumer confidence. Analysts expect a challenging environment for luxury consumption, with upcoming earnings reports from other major brands like Kering and Hermรจs likely to reveal similar struggles.
Despite the downturn, some sectors, like jewelry and watches, showed resilience, with only a 4% decline in sales. Brands that innovate and adapt may perform better as the luxury market navigates these challenges.
Source: https://ca.finance.yahoo.com/news/lvmh-had-rough-week-thats-004102726.html
America's low-cost airlines compete for budget travelers with unique offerings
Seven leading low-cost airlines in the U.S. cater to budget travelers, each with unique operational models. Allegiant Air focuses on smaller, underserved destinations and recently added Boeing 737 MAX aircraft to its fleet.
Avelo Airlines, a newer entrant, has expanded its route network and will open a new base in Connecticut next month. Breeze Airways, also established in 2021, operates a mix of aircraft and plans to transition to the Airbus A220-300.
Frontier Airlines and Spirit Airlines are major competitors, both operating all-Airbus fleets. Southwest Airlines, a pioneer in low-cost travel, has expanded its services to the Caribbean and Hawaii. Sun Country Airlines serves over 100 destinations, primarily from its hub in Minneapolis.
Source: https://simpleflying.com/main-us-low-cost-airlines-guide/
China's shift to electric vehicles dampens oil demand, OPEC revises forecasts
China's oil demand is declining as electric vehicle (EV) sales rise and diesel use falls. OPEC has revised its 2024 global oil demand forecast downward for the third consecutive month, reflecting lower-than-expected consumption in China.
The International Energy Agency (IEA) reports that the shift to electric mobility is impacting oil producers. OPEC now expects China's oil demand to grow by 580,000 barrels per day this year, down from 650,000 barrels per day previously estimated.
China's economic slowdown and increased use of liquefied natural gas (LNG) in trucking are contributing to this decline. Analysts suggest that China's dominance in global oil demand growth may be ending, with emerging markets like India expected to drive future demand.
Source: https://oilprice.com/Energy/Crude-Oil/Chinas-Energy-Transition-Is-Wrong-Footing-OPEC.html
Ford warns EV customers to stop using Tesla Supercharger adapters due to potential issues
Ford has advised some electric vehicle customers to stop using its free adapters for Tesla's Supercharger network. The company identified a potential issue that may lead to slower charging speeds or damage to the charge port.
Affected Ford EV owners are instructed to verify their address through a link in Ford's notice. If the address is correct, no further action is needed; otherwise, they must update it by October 24th.
Ford plans to ship replacement adapters during the week of October 28th. Only a specific recent batch of adapters is affected, and Rivian and General Motors have reported no similar problems with their adapters.
Meta announces layoffs across multiple teams including Reality Labs and Instagram
Meta has announced layoffs affecting multiple teams, including those in Reality Labs, Instagram, and WhatsApp. The company stated these changes are part of a resource reallocation but did not disclose the number of employees impacted.
This marks a shift in Meta's workforce strategy as the company continues to adjust its operations. Previously, Meta had focused on growth and expansion in these areas.
The layoffs come amid broader industry trends, with other tech companies also implementing workforce reductions. This reflects ongoing challenges in the tech sector as companies reassess their priorities and resources.
Source: https://techcrunch.com/2024/10/19/what-we-know-about-the-layoffs-at-meta/
Top economist warns of stock market bubble urges focus on defensive sectors
David Rosenberg, a prominent economist, warns that the stock market is in a bubble and may face a significant decline. He advises investors to adjust their portfolios by focusing on sectors like healthcare, consumer staples, utilities, and aerospace.
Rosenberg suggests that investors should prioritize stocks with strong fundamentals and consider adding "insurance" through gold, government bonds, and real estate investment trusts. He emphasizes caution, especially in the tech sector, where some stocks may be overvalued.
Despite Rosenberg's warnings, many Wall Street forecasters remain optimistic about the market's performance, raising year-end price targets for the S&P 500.
Source: https://finance.yahoo.com/news/heres-where-investors-worried-stock-201501580.html
Tesla, Boeing, IBM, and General Electric prepare to report earnings next week
Tesla, Boeing, IBM, and General Electric are set to report earnings next week, with a focus on industrials. Analysts expect Q3 earnings to reach a record $511.4 billion, but growth is projected to slow to 5.0% from 13.2% last quarter.
Investors will also review existing and new home sales reports, along with durable goods data, ahead of the Federal Reserve's meeting on November 7. Most market participants anticipate a 25 basis point interest rate cut.
The Bank of Canada is expected to reduce rates by 50 basis points due to a slowing economy. The energy sector may see significant cuts in earnings guidance during this reporting season.
Lower mortgage rates may ease pressure on US housing market
Mortgage rates have decreased from a peak of 7.8% in 2023 to about 6.3% recently. This change may provide some relief to home buyers, but it is not expected to significantly boost demand in the housing market.
Existing home sales have dropped to an annual pace of 3.86 million, as many homeowners with lower mortgage rates are hesitant to sell. While prices are expected to rise by 3% in 2024, this is slower than the growth seen during the pandemic.
Home builders are likely to remain active, as buyers turn to new homes due to limited existing inventory. Construction is expected to pick up next year, while multifamily construction may decline as rental demand stabilizes.
Source: https://www.kiplinger.com/real-estate/will-lower-mortgage-rates-help-housing-market