Market Highlights 💡 - 20 March 2025

US Stocks Rise After Fed Policy Decision

🇺🇸 S&P 500 Index: +1.08% 📈

🇺🇸 Nasdaq Index: +1.41% 📈

🇪🇺 STOXX 600 Index: +0.19% 📈

🇯🇵 Nikkei 225 Index: -0.25% 📉

🇭🇰 Hang Seng Index: +0.12% 📈

🇨🇳 CSI 300 Index: +0.06% 📈

🇸🇬 Straits Times Index: +0.34% 📈

Wall Street surged, with the S&P 500 and Nasdaq rising 1.1% and 1.4%, respectively, after the Federal Reserve kept interest rates unchanged and reaffirmed expectations of two rate cuts this year, despite acknowledging that inflation remains resilient.

The Federal Reserve maintained the federal funds rate at 4.25% to 4.5%, as expected. Fed Chair Jerome Powell stated that "uncertainty in the economic outlook has increased," but the risk of a recession remains low.

The Bank of Japan (BOJ) kept rates at 0.5%, citing moderate economic recovery, while also considering global risks and Trump's tariff threats, as inflation risks increase.

Japan's February exports grew 11.4% year-over-year (expected 12.1%), up from 7.3% in January, as businesses rushed orders due to rising tariff concerns.

Asia-Pacific markets saw modest gains, with the Hang Seng Index and CSI 300 Index both rising 0.1%, as investors awaited Tencent's earnings report and the Fed meeting outcome.

Upcoming Events:

Thursday: China's 1-year and 5-year Loan Prime Rate (LPR) announcements and U.S. initial jobless claims data.

Friday: Release of Japan's inflation rate data.

Key Takeaways:

1. “We do recognize that market sentiment has declined significantly, but economic activity has not been significantly impacted. I want to reassure everyone that the economy remains healthy.” — Jerome Powell

Jerome Powell

2. Nvidia $NVIDIA Corp(NVDA)$ and Elon Musk's xAI have joined Microsoft $Microsoft(MSFT)$ and BlackRock's $BlackRock(BLK)$   AI infrastructure partnership, committing over $30 billion to AI data centers and energy projects in the U.S.

AL Infrastructure Partnership

3. Samsung has vowed to regain leadership in the AI storage market, planning to launch an upgraded 12-layer HBM3E chip in Q2, to meet surging AI-driven demand and boost the memory market recovery.

Samsung HBM

4. Tencent's $TENCENT(00700)$ Q4 profit surged 90% to $7.1 billion, driven by gaming, AI-powered advertising, and cloud computing growth. The company plans to increase 2025 capital expenditure to over $10 billion, focusing on AI infrastructure.

Tencent

5. Foxconn, $Foxconn Technology Co., Ltd.(FXCOF)$  the main manufacturer of Nvidia's GB200 and GB300 AI systems, expects server revenue to surpass iPhone revenue within two years, benefiting from explosive AI demand.

Foxconn

Summary:

Despite the Fed lowering its economic growth forecast and raising its inflation outlook, the market has largely priced in the downside risks after weeks of volatility. Powell's dovish remarks reassured investors, fueling a stock market rebound.

@Daily_Discussion  @TigerStars  @Tiger_comments