Chinese tech stocks are both appetizing and terrifying [Video]
|The first day back after the long weekend brought traders back down to earth. A weak sale of US 2 and 5-year notes, and Federal Reserve’s (Fed) Neel Kashkari’s comments that the Fed cannot rule out hiking the interest rates as a next move sent the US treasuries lower yesterday. Stocks stagnated, except Nvidia - which jumped 7% on news that Elon Musk’s xAI would use its H100 chips!
In the FX, the broad-based recovery of the US dollar sent the EURUSD lower yesterday before it reached the 1.09 resistance. Inflation expectations in the Eurozone fell to the lowest levels since 2021. All eyes are on a series of Eurozone inflation updates that are due to hit the ground starting from today. The euro-sterling is testing the critical support of 0.85, while the sterling-yen hit the 200 psychological, the highest level in 16 years.
Elsewhere, the news that China set a $48 billion fund to support domestic chip-makers didn’t resonated well across the Chinese AI-related stocks – to my surprise. PDD tanked 5% yesterday, Tencent is down by more than 1% and Alibaba is down by almost 4% in Hong Kong this morning. Chinese AI stocks are both appetizing and terrifying.
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