US Stock Forecast | Futures of the three major stock indexes have mixed ups and downs, and the “Science and Technology Spring Festival Gala” is boiling! Hwang In-hoon makes a big debut with a variety of new products

1. Before the US stock market on January 7 (Tuesday), futures for the three major US stock indexes had mixed ups and downs. As of press release, Dow futures were up 0.08%, S&P 500 futures were up 0.05%, and NASDAQ futures were down 0.01%.

2. As of press release, the German DAX index rose 0.32%, the UK FTSE 100 index fell 0.24%, the French CAC40 index rose 0.70%, and the European Stoxx 50 index rose 0.58%.

3. As of press release, WTI crude oil rose 0.49% to $73.92 per barrel. Brent crude oil rose 0.68% to $76.82 per barrel.

Market news

The Federal Reserve issued a rare direct warning against US stocks. Director Cook said that market valuations are too high or are facing a sharp correction. Federal Reserve Governor Lisa Cook issued a rare direct warning to the stock market on Monday. Cook said, “Many asset classes are overvalued, including the stock and corporate bond markets. Risk premium valuations are close to the low point of historical distribution, which indicates that the market may have reached the extreme. As a result, these markets may be at risk of a sharp decline due to negative economic news or changes in investor sentiment.” Federal Reserve Chairman Powell rarely spoke so bluntly about the market, and Cook's remarks are reminiscent of former Federal Reserve Chairman Alan Greenspan's warning of “irrational prosperity” in 1996. However, unlike Greenspan's remarks back then, which triggered market fluctuations, Cook's warning was not taken seriously by the market. The S&P 500 index regained 6,000 points on Monday and is close to its all-time high.

The foreign exchange market “turned upside down” within 24 hours, just because of Trump! In 2025, “high volatility” will be the key word in the foreign exchange market. On Monday, the foreign exchange options market of more than 300 billion US dollars began peacefully until political headlines in Canada and the US triggered the busiest foreign exchange options trading day in the past two months — the scale of foreign exchange options trading rapidly heated up, indicating that political factors in 2025, especially all political news relating to Trump himself, will influence the trading trend of the foreign exchange market.

The threat of tariffs is compounded by concerns about a strike, and container freight rates between Asia and the US have soared again. Spot container freight rates for goods shipped from Asia to the US soared over the past month as companies wanted to avoid higher tariffs and replenish stocks before the strike could result in the closure of ports that account for about half of the US shipping trade volume. According to data from Oslo-based shipping platform Xeneta, as of January 1, the price of booking a 40-foot container from Asia to the west coast of the United States was $6,000, up 50% from $4004 a month earlier. Shipping costs on the east coast were $7,100, an increase of 31%. Emily Stausbøll, senior shipping analyst at Xeneta, said the market is tightening due to “a lot of uncertainty.” “2024 is an extremely challenging year for shippers, and life won't get any easier as we enter 2025”.

In 2024, the financing of American AI startups hit rock bottom, drawing a record $97 billion. Last year, venture capitalists' investment in artificial intelligence startups in the US soared to a record $97 billion, with companies such as Elon Musk's XAI, OpenAI, and Anthropic receiving huge investments of billions of dollars. According to the latest data released by PitchBook on Tuesday, the boom has caused artificial intelligence investment to continue to rise as a share of all startup investments, accounting for almost half of the total US$209 billion raised by US startups last year. Although the total amount of financing for startups increased slightly this year, an increase of about one-third compared to 2023, there is a clear trend of differentiation within the venture capital industry. Specifically, large established companies and some of the biggest and hottest startups are finding it easier to raise capital.

Wall Street Bond Short: The 10-year US Treasury yield will rise to 5.5% by the end of the year. One of Wall Street's biggest bond bears had a good start to the year, as US bond yields are approaching his predictions. Padhraic Garvey, head of global debt and interest rate strategy at Dutch International Group, predicts that the 10-year US Treasury yield will rise to 5.5% by the end of 2025, and the yield will close at around 4.63% on Monday. His forecast for ten-year US Treasury yields was about 40 basis points higher than the second-most pessimistic forecast. Padhraic Garvey's forecast is based on the expectation that the Federal Reserve will keep interest rates limited to offset the risk that US President-elect Trump's tariffs and tax cuts will cause price pressure, as well as the risk that investors will continue to discourage the Union.

Individual stock news

The “Science and Technology Spring Festival Gala” is boiling! Hwang In-hoon made a big debut with a number of new products to decode Nvidia's (NVDA.US) AI strategic ambitions. On Tuesday, Beijing time, Nvidia (NVDA.US) CEO Huang Renxun delivered a keynote speech at the International Consumer Electronics Show (CES) known as the “Technology Spring Festival Gala”. He unveiled a range of new products, including a new GeForce graphics processor (GPU) for gaming computers, which uses the same Blackwell design as Nvidia's artificial intelligence (AI) accelerators. Nvidia first became famous as a video game graphics card manufacturer. But now, these products are overshadowed by their accelerator chips for data centers. Still, gamers are eager to own GeForce-equipped machines, and the division's annual revenue is around $10 billion. Nvidia has also launched the Cosmos World Basic Model Platform, which covers generating basic models of the world, to accelerate the development of physical AI systems such as autonomous vehicles and robots.

Qualcomm (QCOM.US) brought a new AI chip to the “Technology Spring Festival Gala”, and the price of a PC with it was as low as 600 US dollars. Qualcomm (QCOM.US) has launched a new chip designed to power personal computers (PCs) capable of running the latest artificial intelligence (AI) software, and PCs equipped with the new chip are expected to cost as low as $600. Qualcomm announced at the International Consumer Electronics Show (CES 2025) known as the “Spring Festival Gala of Technology” that the Snapdragon X platform consists of an 8-core Oryon central processor, graphics components, and a dedicated AI chip, and will run Microsoft (MSFT.US) Copilot+ software. Qualcomm also said that PC manufacturers such as Dell (DELL.US) will launch laptops based on this new product “in early 2025.”

Aurora (AUR.US), Nvidia, and Continental join forces to develop driverless trucks. Autonomous driving technology company Aurora, automotive supplier Continental, and Nvidia have reached a long-term strategic partnership to deploy driverless trucks on a large scale. The partnership will utilize Nvidia's next-generation DRIVE Thor system-on-chip and DriveOS, which will be integrated into the SAE Level 4 autonomous driving system Aurora Driver. Mass production of these driverless trucks is scheduled for 2027, and initial service is scheduled to be launched in Texas in April 2025.

Indonesian officials will discuss the $1 billion investment with Apple (AAPL.US), which may affect whether the iPhone 16 can be launched in Indonesia. The Indonesian Ministry of Industry is scheduled to hold a key meeting with Apple this Tuesday. The core topics will revolve around Apple's investment plans in Indonesia. This move is seen as a necessary step for Apple to launch the new iPhone 16 in the Indonesian market. Looking back at last year, Apple faced a ban on sales of its iPhone 16 in Indonesia because it did not meet the Indonesian government's threshold of at least 40% of the local smartphone component content. Although Apple has yet to establish a production plant in Indonesia — a country with a population base of 280 million — Apple has set up an application developer academy in Indonesia since 2018, showing its intention to develop in the region for a long time.

American Steel (X.US) and Nippon Steel are suing Biden, and they may be able to get more time to negotiate with Trump. US Steel and Nippon Steel are unlikely to persuade the court to reverse President Biden's decision to block their $14.9 billion merger, but their lawsuit may give them more time to reach an agreement with incoming President Trump. In a lawsuit announced on Monday, the two companies argued that Biden blocked the merger through false national security reviews, denied the two companies the right to fair procedures and violated the Constitution. Although the lawsuit itself may be doomed to failure, if the two companies can persuade Trump to change their opposition, it could give new life to the deal.

Toyota (TM.US) will invest more than $44 million in Japanese space startup Interstellar. Interstellar Technologies, a Japanese space startup that develops satellite launch vehicles, announced on Tuesday that Toyota will invest 7 billion yen (approximately US$44.4 million) through its mobile technology subsidiary Woven by Toyota. According to reports, Interstellar Technologies' goal is to produce light rockets on a large scale and one day compete with large companies for part of the growing commercial space industry. Toyota said the company hopes to use its experience in mass production of automobiles to cooperate with Interstellar Technologies to produce rockets.

Key economic data and event forecasts

21:30 Beijing time: US trade balance for November (100 million US dollars).

21:55 Beijing time: The annual rate of commercial retail sales of the Red Book in the US for the week ending December 30 (%).

23:00 Beijing time: US ISM non-manufacturing PMI for December, US JoLTS vacancies for November (10,000).

5:30 a.m. Beijing time the next day: Changes in US API crude oil inventories for the week ending January 3 (10,000 barrels)

21:00 Beijing time: 2027 FOMC voting committee and Richmond Federal Reserve Chairman Barkin delivered a speech.