The Overnight News Roundup

Jan 16, 2025

PiQ and Zack Eiseman provide you with a consolidated roundup of the overnight news that matters most to markets.

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MACRO:

ES and NQ futures saw strength after Taiwan Semiconductor Manufacturing Co reported a strong quarter and guidance, particularly due to AI spending.
U.S. President Biden warned in his farewell address that an American oligarchy is taking shape among a few tech billionaires who have amassed a "dangerous concentration of power." (RTRS)
Incoming Treasury Sec Scott Bessent, in prepared remarks for Congress, vowed to ensure that the dollar remains the world's reserve currency. Said the new administration must prioritize productive investment that grows the economy over "wasteful spending that drives inflation." (RTRS)
Outgoing Treasury Sec Janet Yellen said Trump's plan to set up a new government agency to collect tariffs would duplicate an existing agency and was unlikely to save money. (RTRS)
The Bank of Japan is likely to hike rates next week unless there is a "major rout in markets" following Trump's inauguration, according to Bloomberg citing several, unnamed sources. (BBG)
BoJ Governor Ueda reiterated his comments from Wednesday saying that the policy rate will be raised this year if economic and price conditions continue to improve and tat the bank will debate at next week's meeting whether to hike rates. (RTRS)
The BoJ will raise interest rates again at one of the two meetings this quarter to 0.50%, an overwhelming majority of economists surveyed by Reuters said, with most leaning toward a January move. Majority expect currency intervention when USD/JPY rises to 165. (RTRS)
Japan's annual wholesale inflation held steady at 3.8% in December on stubbornly high food costs, highlighting persistent price pressures that may prod the central bank to raise interest rates next week. (RTRS)
Two-thirds of Japanese companies are experiencing a serious business impact from a shortage of workers, a Reuters survey showed, as the country's population continues to shrink and age rapidly. (RTRS)
Australian employment sped past forecasts in December although the jobless rate ticked higher as many more people went looking for work - the combination of trends signalling a healthy labour market that leaves alive the chance of a near-term cut in rates. (RTRS)
South Korea's central bank unexpectedly left its policy interest rate unchanged, weighing the impact of its back-to-back cuts last year while supporting the won which recently weakened to a 15-year low versus the U.S. dollar. (RTRS)
PBoC might cut RRR before the Lunar New Year this month (Jan 29th), according to analysts cited by Shanghai Securities News. (Shanghai Securities News)
China’s cash squeeze extended with some signs of disruption to trading, as a liquidity infusion from Beijing failed to counteract a spike in demand for funds. Late Wednesday there were some failed trades and a 10 minute delay to the official close of a clearing system. (BBG)
Chinese officials and automakers are eyeing German factories slated for closure and are particularly interested in Volkswagen's sites in efforts to build influence in Germany's prized auto industry. China hopes Germany will have an "open mind". (RTRS)
Vanke, the Chinese property developer, saw more acute selling pressure in its bonds on Thursday. There were also reports that the Co. had told investors it had no plan to extend its bonds, according to REDD cited by Reuters. (RTRS)
Vanke later announced it will make every effort to raise funds for public debt due in 2025. The company plans to accelerate the exit from non-core businesses and focus on asset disposals. (RTRS)
Chinese citizens are increasingly skeptical about the government’s official economic growth figures. (FT)
Canada has drawn up an initial list of C$150 billion ($105 billion) of US-manufactured items that it would hit with tariffs only if/once Trump decides to levy tariffs against Canadian goods. (BBG)
Outgoing Canadian PM Trudeau said all options were on the table as to how Canada might respond if Trump goes ahead with a threat to impose 25% tariffs on Canadian imports. (RTRS)
New Zealand, Australian and US dairy companies are accusing Canada of dumping low-priced milk products on world markets and have asking their governments to intervene. (BBG)
GBP was pressured after data showed the U.K. economy grew at a lackluster pace of 0.1% in November. This compares with the 0.2% month-on-month growth expected by economists polled by Reuters. (CNBC)
UK estate agents expect house prices and property sales to rise in 2025 despite concerns over the impact of borrowing costs on mortgage holders, according to the latest RICS survey. (FT)
Pension funds are increasingly dipping their toes into buying bitcoin, in a sign that even typically staid corners of finance are finding it hard to ignore the potential outsized returns from cryptocurrencies. (FT)
ECB's Centeno said the ECB should continue to lower interest rates to about 2% as inflation in the euro zone was generally under control. (RTRS)

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GEOPOLITICAL:

The Biden administration is exploring ways to keep TikTok accessible in the US even as a ban is set to take effect on Sunday. (NBC)
Trump is considering an executive order once in office that would suspend enforcement of the TikTok ban-or-sale law for 60 to 90 days, buying the administration time to negotiate a sale or alternative solution. (WaPo)
TikTok CEO plans to attend Trump's inauguration. (NYT)
UK PM Starmer will sign a “100-year partnership” treaty between Britain and Ukraine, in a show of support for Volodymyr Zelenskyy ahead of Donald Trump’s inauguration as US president next week. (FT)

EQUITIES:

TSMC logged record quarterly profit on Thursday and said it expects hefty first-quarter revenue growth as demand surges for chips used in AI processing. (RTRS)
Apple's smartphone shipments in China plunged 25% in Q4, data from research firm Canalys showed, where Huawei took market share. (RTRS)
Apple is in talks with Barclays to replace Goldman Sachs as the tech giant's credit card partner. Synchrony Financial is also in discussions with Apple about the card partnership. (RTRS)
Nvidia plans to unveil optical switches for co-packaged optics at its GTC conference in March, as part of measures to reduce power consumption and heat in AI servers, with mass production of the Switch ASIC chip set for August at TSMC. (CTEE)
Tesla started offering discounts on new Cybertruck vehicles in its inventory this week, according to listings on the company’s website. (CNBC)
Jeff Bezos’ space company launched its massive new rocket for the first time, aiming to advance the Amazon founder’s lifelong space-exploration ambitions. (WSJ)
Goldman Sachs CEO Solomon said there’s an end in sight to the multi-year IPO drought. (CNBC)
If TikTok does indeed go dark on Sunday for Americans, VPNs are expected to see a surge in demand to continue providing access. (CNBC)
Hindenburg Research founder Nate Anderson said he has made the decision to disband Hindenburg Research. (Newsquawk)
Drake has sued Universal Music Group NV for defamation in US federal court, accusing the company of putting his life in danger by releasing and promoting a song by his rival and labelmate Kendrick Lamar. (BBG)
Rio Tinto reported its lowest annual iron ore shipments in two years, partly as heavy rains in Western Australia impacted output in the December quarter, but said the global economy was showing signs of strength, including signs of stabilisation in the Chinese property market. (RTRS/FT)
Antofagasta reported a modest 1% rise in its 2024 copper production to 664,000 metric tons, below its guidance, as higher production at its flagship projects was offset by lower grades. (RTRS)
Richemont said it saw an improvement across all business areas and reported better-than-expected sales for its fiscal third quarter. (WSJ)
Renault said it plans to launch seven new models this year after global sales increased in 2024. (WSJ)
TotalEnergies expects fourth-quarter 2024 downstream results to have benefited from a slight increase in refining margins. (RTRS)