World Street takes a view of the market from across the world.
Stocks linked to cryptocurrencies are aiming to extend their November gains after bitcoin touched a fresh high for the year. Gold prices, too, have scaled a record high, driven by a weaker dollar and strengthening hopes of an end of the interest rate hike cycle. Music streaming app Spotify is likely to lay off 17 percent of its workforce as a cost-cutting measure. Tech start-ups are attempting to transform the way rare earths are refined to create a niche in the sector that China dominates. All this and more in World Street today.
Cryptocurrency-related stocks listed in the US surged on Monday, looking to extend their November gains, as bitcoin topped $42,000 to hit a fresh high for the year. Bitcoin climbed 4 percent, riding a wave of enthusiasm about potential interest rate cuts in the US as well as traders betting on the imminent approval of US stock market-traded bitcoin funds.
Gold and glory
Gold shines the brightest ever, boosted by a decline in the dollar as traders wager on the Federal Reserve cutting the interest rates next year. The safe-haven asset rallied 2 percent to $2,111 per troy ounce on Monday, a fresh all-time high, before slipping to $2,064, according to Refinitiv data.
End of the party
Music streaming giant Spotify said it will lay off around 1,500 employees, or 17 percent of its workforce, to bring down costs, after letting off 600 in January, and 200 more in June. After a round of job-cuts at the start of the year by tech companies, some have again started trimming down the manpower, with announcements coming from Amazon to Microsoft-owned LinkedIn.
Rare-ing to go
Tech start-ups are racing to transform the way rare earths are refined for clean energy transition, a push aimed at turbocharging the West’s expansion into the niche sector currently dominated by China. The existing standard to refine these strategic minerals, known as solvent extraction, is an expensive and dirty process that China has spent the past 30 years mastering. MP Materials, Lynas Rare Earths and other Western rare earth companies have struggled at times to deploy it due to technical complexities and pollution concerns, reports Reuters.
Bill Gates’ advanced nuclear reactor company TerraPower LLC and the United Arab Emirates-owned nuclear company ENEC signed a pact to study the potential development of advanced reactors in the UAE and abroad. This comes amid a push by the Kingdom to expand its nuclear energy capacity, and a pledge by over 20 nations at the COP28 climate conference in Dubai to triple nuclear deployment this decade to fight climate change.
Sales of Tesla’s China-made electric vehicles skidded 17.8 percent in November from a year earlier to 82,432 cars. Chinese rival BYD, with its Dynasty and Ocean series of EVs and petrol-electric hybrid models, saw passenger vehicle deliveries set another record at 301,378 vehicles, up 31 percent from a year earlier.
S&P 500’s new entrants
After ride-sharing company Uber Technologies was added to the US major average – S&P 500 index on reporting two straight quarters of operating profits, Jabil Inc and Builders First Source Inc are set to join too. These companies are expected to replace Alaska Air Group Inc and SolarEdge Technologies. The new additions will join the index prior to market opening on December 18, 2023. One must note that companies must be highly liquid with a market capitalisation of at least $14.5 billion and meet profitability, liquidity, and share-float standards in order to qualify for the world’s most watched S&P 500 index.
No IPO frenzy
Hong Kong’s primary markets continue to remain a dull dud in the second half of this year as well. The initial public offering (IPO) market in Hong Kong is at a 20-year low as funds raised by IPOs declined by 63 percent year-on-year to HK$31.7 billion in the first ten months of this year. Hong Kong’s biggest IPO of the year – ZJLD Group, for instance, debuted markets on a disappointing note. Thereafter, the second-largest listing J&T also cut its issue size on the back of weak investor sentiment.
Winds of change
There has been an ongoing evidence of a change in Japanese corporate behaviour. In a recent Jefferies Greed & Fear note, analysts first referred to the recent news of Panasonic selling a stake in subsidiary – Panasonic Automotive Systems that makes auto parts to funds managed by Apollo Global Management. Toyota and two affiliates – Toyota Industries and Aisin – are also expected to sell about 10 percent stake in auto parts supplier Denso. If all this is positive, analysts believe that export-oriented stocks will be highly vulnerable in a world where the US enters a recession and yen appreciates.
The White House has issued a blunt warning that the US is likely to run out of funds to aid Ukraine by the end of this year, saying that a failure by Congress to approve new support would ‘kneecap’ Kyiv. “No magical plot available, we are out of money and nearly out of time,” wrote Shalanda Young, White House budget director, in a letter to congressional leaders. Ukraine desperately is in need of economic support and if funds stop, it is feared that at some point Ukraine’s economy will collapse and they will not able to keep fighting.