James Ooi: Tech Rallied on Trump’s Win: Here’s Why
Key Insights:Trump is likely to prioritize supporting the tech industry to strengthen the U.S.'s competitive edge and preserve its position as the global technological leader.A key focus for the incoming Trump administration will likely be securing American dominance in the global AI race, with particular emphasis on outpacing China.While antitrust lawsuits may continue to dampen investor sentiment, these legal battles are expected to drag on for years due to prolonged appeals.If Trump implements tariffs of 60% or more on Chinese imports, it could provoke retaliatory measures from China, potentially targeting U.S. companies that manufacture there.I remain constructive on tech companies, especially those involved in AI. Big tech companies that are involved in antitrust lawsuits, pursu
What You Need to Know About the US Presidential Election?
US betting sites currently show different forecasts: Polymarket: Trump wins the presidency, Republicans win the Senate, Democrats win the House. PredictIt: Harris wins the presidency, Republicans win the Senate, Democrats win the House. Trump vs. Harris: The US presidential election will be decided by the Electoral College. Kamala Harris, 60, the Democratic nominee, or Donald Trump, 78, the Republican nominee, needs to win 270 electoral votes to secure the presidency. Senate: The U.S. Senate currently comprises 51 Democrats and 49 Republicans, with Democrats in control. 34 out of 100 seats (one-third of the Senate) are up for election. Of these, Democrats and allied Independents hold 23 seats, while Republicans hold 11. Some analysts predict that Republicans are likely to win
Chip Area Special| If You Missed Nvidia, Don’t Overlook These Custom Chip Makers!
Key Insights The AI inferencing market is smaller than the AI training market, but it remains an exciting growth area for investors. I am constructive nearly all the players in the custom chip market, including $Broadcom(AVGO)$ , $ARM Holdings Ltd(ARM)$ , $Microsoft(MSFT)$ , $Alphabet(GOOG)$ , $Amazon.com(AMZN)$ and $Taiwan Semiconductor Manufacturing(TSM)$ While Nvidia is expected to dominate the AI training market with over 90% market share in the coming years, I believe the AI inferencing market will be largely captured by hyperscalers
Goldman Warns the Party Is Over, Forecasts Just a 3% Annual Return for the S&P 500 Over the Next 10 Years
Last week, investors were taken by surprise by Goldman Sachs’ bleak S&P 500 outlook. Goldman Sachs expects only a 3% annual return for the S&P 500 over the next 10 years. In comparison, the S&P 500 has boasted a 14% annualized return over the past decade. JP Morgan, on the other hand, expects a 5.7% annual return over the next 10 years. Both firms cited high valuations and high concentration as the main reasons for future tepid returns. Goldman noted that the S&P 500 is now overly reliant on a few companies (e.g., the Magnificent Seven) for outsized return contributions, making it extremely difficult for any firm to maintain high levels of sales growth and profit margins over sustained periods. However, Goldman also acknowledged that its model has failed on multiple occasio
The TLT ETF Has Crashed 9% from Its Recent High. Here’s Why.
Despite the iShares 20+ Year Treasury Bond ETF ( $iShares 20+ Year Treasury Bond ETF(TLT)$ ) seeing a net inflow of $1.868 billion in October, the ETF has declined 1.84% so far this month.While Fed rate cuts over the next year should trigger a bond market rally, the TLT has dropped approximately 9% since the Fed cut rates during the September FOMC meeting.Source: Bloomberg, 27 Oct 2024Trump Win Raises Inflation Risks:Traders are now pricing in higher odds of a Trump victory, which could lead to soaring inflation due to his expansionary and trade policies. Consequently, FOMC rates may remain elevated for longer than expected. Soft Landing/No Landing:Economic data, including labor market metrics, retail sales, and PMI, indicate that the US econo
4 Tech Stocks to Watch Closely:TSLA, ARM, NVDA, TSM
Here’s a recap of the weekly gains and key highlights for the top stocks that were in focus last week.Tesla $Tesla Motors(TSLA)$ (+21.97%)Tesla's stock rose 21.97% last week on earnings beat.However, its year-to-date return of 8.33% remains the worst among the Magnificent Seven.While the earnings surprise is encouraging, it is not a game-changer; the main investment thesis is that Tesla will launch new car models in the first half of 2025.Currently, Tesla is my least favorite stock among the Magnificent Seven. I believe much of the optimism is already priced in, and there will be better accumulation opportunities ahead.ARM $ARM Holdings Ltd(ARM)$ (-6.06%)ARM's stock fell 6%
U.S. Presidential Election: What Does It Mean for Stocks?
The Impact of Different Possible U.S. Presidential Election Outcomes:1) While Trump and Harris’s policies differ widely, they would not significantly affect the stock market in the event of a split Congress.Regardless of the U.S. presidential election outcome, extreme policies that could disrupt the business cycle and change the trajectory of the economy are less likely to be enacted in the case of a split Congress, such as when the House is controlled by Democrats and the Senate by Republicans.As a result, the U.S. stock market could rise further after the election if a split Congress occurs.Some investors argue that Trump’s plan will stoke inflation risk. However, I reckon investors would priced in a stronger economy and corporate earnings under trump and would have worried inflation ris