Week Ahead: DeepSeek's Impact on Capex, US Tariffs, and Tech Earnings in Focus

Week Ahead: 3 Feb 2025

DeepSeek Impact: DeepSeek disrupted the AI scene with Nvidia Corp (NVDA), market leader in the current AI rally, breaking its key technical levels. We remain cautious on Nvidia moving forward and have outlined both bullish and bearish scenarios for the stock.

US Tariff Impact: US tariffs have begun, leading to a stronger dollar—a development the markets dislike. As a result, ETFs tracking both developed and emerging markets fell between 0.50% and 1.12%.

Precious Metals: Among the headlines, precious metals such as gold emerged as winners for the week, gaining around +1.00% and trading at an all-time high, near US$2,800/oz.

Medium Term:

S&P 500 (SPX): The S&P 500 is holding steady, consolidating this week as it encounters resistance again around 6,100. Our outlook remains neutral for now. The key level to watch is the 5,780-5,832 support zone. As long as the index stays above this, further consolidation and a potential move upwards are possible.

Big Tech earnings and any developments regarding Trump's policies could be catalysts for a directional shift in the market. We'll be closely monitoring these events for clearer signals.

Straits Times Index (STI): The STI's move above its previous trading range is a potentially bullish development. Sustained support above 3,765, would increase the probability of trading towards the 4,000 level.

Hang Seng Index (HSI): The China A50 Index (grey line) is still trending upwards. The Hang Seng Index (candlestick) is holding above its 19,000 support zone. The reopening of the Hong Kong Exchange (HKEX) this week could provide directional cues for the Hong Kong market.

Long Term:

S&P 500 (SPX) trend remains upward

Hang Seng Index (HSI) trend remains upward

Straits Times Index (STI) trend neutral to upward trend.

Headlines Next Week:

- US Corp Earnings: Amazon, Alphabet, Palantir Tech, Merck, PepsiCo, AMD, Pfizer, Walt Disney, Qualcomm and Uber.

- SG Corp Earnings: SG REITs, CICT, Keppel, SGX,

- US Jobs Report, ISM surveys

- China/HK markets reopen, Econ reports,

- SG PMI Survey, Retail Sales

Disclaimers apply

Historical Stock Market Performance During the Year of the Snake (2025)

Historical Stock Market Performance During the Year of the Snake (2025) Introduction: The Chinese zodiac plays a fascinating role in shaping cultural beliefs and behaviors. Among the 12 zodiac animals, the Year of the Snake is often associated with intelligence, caution, and financial shrewdness. We take a simply review of three key indices, S&P 500, Hang Seng Index (HSI), and Straits Times Index (STI), annual performance during the Year of the Snake. Key Observations from the Data: S&P 500 Performance: Average annual return: 0.47% . Win/Loss ratio: 37.5% (3 years of gains vs. 5 years of losses). Notable years: 1989 marked a robust gain of 27.25% , while 1941 saw a steep decline of -20.22% , coinciding with global tensions during World War II. HSI Performance: Average annual return: -5.36% . Win/Loss ratio: 66.67% (2 years of gains vs. 1 year of losses). Notable years: The index's strongest year was 1989, with a return of 5.55% , while 2001 suffered a severe decli...

Week Ahead: Trump Trade and the Resilient US Economy

Week Ahead, 9 Dec 2024 Macro News: U.S. markets continued their record-breaking streak this week following a reassuring speech by U.S. Federal Reserve Chair Jerome Powell, highlighting Fed's cautious yet comfortable stance on rate cuts. Beneficiaries of the "Trump Trade" also saw significant gains, with Tesla Inc. rising by +12.77% and Bitcoin up +2.24% for the week. The U.S. technology sector, represented by the QQQ ETF, also performed strongly, boosted by Friday's jobs report, which indicated a resilient economy. Meanwhile, the Hang Seng Index (2800 ETF) experienced a technical turnaround, gaining +2.28% this week. The rally was fuelled by speculation that Beijing might introduce additional lending and mortgage rate cuts to stimulate the economy. Medium Term: • S&P 500 (SPX): Index remains above the 6,000 level and could trend towards the 6,180 zone. • Straits Times Index (STI): STI reversed near our 3,860 resistance zone. We are neutral and is looking out for...

BYD Co (1211:HK) Witnessing Signs of Strength

BYD Co (1211:HK) Witnessing Signs of Strength On Friday, we observed strong buying within a wide trading range, with the stock closing near the day’s high and good volume recorded. The previous two days of selling showed relatively low volume, indicating potential supply exhaustion. The stock price is currently at a key resistance level, constrained by a downward trendline and a horizontal support-turned-resistance line. A breakout above this level could signal a potential trend reversal , with an initial technical price target of HK$300.00. The stock is outperforming the broader market, indicating strong market demand, as evidenced by our proprietary Relative Strength Indicator (RSI), which is above zero. Additionally, the volume momentum indicator (FFI) is improving, further supporting the possibility of supply exhaustion. The Stochastic indicator also continues to trend higher, reinforcing a bullish outlook. A stop-loss price is set below HK$248.40 . If the price falls below this l...

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