CNBC Daily Open: A Trump post drowns out positive developments for markets

U.S. stocks had a rocky day of trading, swinging from highs to lows like the quality of Game of Thrones across its eight seasons.

At its lowest during the session, the S&P 500 fell as much as 1.5%, but recovered and traded positively for most of the day after U.S. Trade Representative Jamieson Greer hinted that China’s next trade move could influence how President Donald Trump’s tariffs are implemented.

The optimism in markets fizzled, however, when Trump said he was considering “terminating business with China having to do with Cooking Oil” and other forms of punitive measures, citing Beijing’s halt of U.S. soybean purchases since May. Investors seemed to take that threat seriously, sending the S&P 500 down 0.2% for the day.

Developments elsewhere, however, were more encouraging. Federal Reserve Chair Jerome Powell suggested that the central bank might stop tightening monetary policy concerning its bond holdings. Meanwhile, major banks — bellwethers for economic activity — such as JPMorgan Chase, Citi and Goldman Sachs, beat earnings expectations, suggesting that the economy’s fundamentals remain intact.

And while Oracle’s pivot to AMD’s artificial intelligence chips — a move away from Nvidia graphics processing units — may not thrill Jensen Huang, it reduces concentration risk and strengthens the case for investors banking on AI to continue the market rally.

Still, Trump’s rhetoric overshadowed everything else. The question, then, is whether his trade brinkmanship will derail the AI-fueled market — or if the Magnificent Seven kingdom will stand.

Trump threatens China with cooking oil embargo. That’s in response to Beijing halting its purchases of U.S. soybeans since May. Whether 100% tariffs on China come into effect depends on how the country reacts, U.S. Trade Representative Jamieson Greer said Tuesday.

Prices in China fall more than expected in September. The consumer price index declined 0.3% from a year earlier, steeper than the 0.2% drop forecast by economists. However, core CPI rose 1% year on year, the highest since February 2024, according to Wind Information.

ChatGPT will soon allow ‘erotica’ for adults. OpenAI CEO Sam Altman announced the major policy shift Tuesday, saying that it’s part of the company’s “treat adult users like adults” principle. The company previously prohibited most adult content on its chatbot.

U.S. stocks were mixed. On Tuesday, the S&P 500 and Nasdaq Composite fell but recovered from session lows. The Dow Jones Industrial Average, however, closed in the green. Asia-Pacific markets traded higher Wednesday. South Korea’s Kospi index jumped more than 2.5%.

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Chinese firms pull back from listing in the U.S. as Hong Kong IPOs see a surge

Chinese initial public offerings in the U.S. have slumped 4% year on year in terms of deal value so far this year, raising just $875.7 million from 23 deals. Meanwhile, Chinese IPOs in Hong Kong this year have surged 164% year on year, raising $18.4 billion from 56 listings, Dealogic data showed.

One major snarl for Chinese companies interested in U.S. listings is Beijing’s tight control of the IPO process. A growing number of U.S.-listed Chinese companies are also looking at Hong Kong amid rising delisting risks in the U.S., a trend that’s giving an extra boost to the city’s sizzling market.

— Anniek Bao