Garfield Reynolds, Bloomberg's MLIV Asia Team Lead, teams up with Katy Kaminski, Chief Research Strategist at AlphaSimplex, to delve into the latest shifts in the tech market. They discuss the Nasdaq 100's remarkable rise fueled by AI enthusiasm and Nvidia's stock hitting record highs. Key topics include the Federal Reserve's ongoing challenges and Hong Kong's currency intervention to stabilize its dollar peg. The duo also analyzes the implications of geopolitical tensions on market dynamics and seeks to unravel complex currency relationships.
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insights INSIGHT
AI Tech Optimism Drives Markets
Optimism in AI continues to drive narrow tech rallies despite broader market stasis.
Investors see tech growth as one of few bright spots amid mixed equity action.
insights INSIGHT
High Nasdaq Valuations Worry
The NASDAQ 100 trades at about 31 times earnings, raising sustainability concerns.
Such elevated valuations provoke skepticism about how long tech growth can last.
insights INSIGHT
Fed Waits for Tariff Inflation Data
Federal Reserve waits for concrete data on tariffs' inflation impact given lagging indicators.
Stable unemployment keeps policymakers cautious about immediate rate cuts.
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The US stock rally lost some steam Wednesday with the S&P 500 Index ending the day flat after Federal Reserve Chair Jerome Powell told lawmakers that officials are struggling to determine the toll of tariffs on inflation. The benchmark closed the session unchanged in New York after swinging between small gains and losses, while the technology heavy Nasdaq 100 Index edged up 0.2% to log another all-time closing high. The tech benchmark reached the milestone Tuesday for the first time since February as a combination of robust fundamentals and easing geopolitical tensions boosted the appeal of the growth-focused gauge. In individual stock moves, Nvidia shares closed at an all-time high, with the leader in artificial intelligence chips extending an advance that has cemented its position as one of the most valuable companies in the world. We get reaction to the day's price action from Katy Kaminski, Chief Research Strategist at AlphaSimplex.
Plus - Hong Kong's de facto central bank bought the local dollar to prop it up on Thursday, in a move to defend the city's currency peg to the greenback. The Hong Kong Monetary Authority purchased HK$9.42 billion ($1.2 billion) of local currency against the US dollar, after the exchange rate touched the weak end of the permitted 7.75-7.85 per greenback trading band. In addition to pushing the currency back into its permitted trading range, the move will also make bearish bets more costly. It does this by draining liquidity from the financial system and driving up borrowing costs. We get reaction from Garfield Reynolds, Bloomberg's MLIV Asia Team Lead. He speaks with Bloomberg's Haidi Stroud-Watts and Avril Hong.
Bloomberg Daybreak: Asia Edition