An employee removes a silver bar for sale from the shelf at a Costco in Bayonne, New Jersey, U.S., on Friday, Oct. 4, 2024.
Clark Hodgin | Bloomberg | Getty Images
This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.
What you need to know today
Colombia to see first Trump tariffs
U.S. President Donald Trump wrote on his social media platform Truth Social he would immediately impose a 25% tariff — which will go up to 50% in a week — on goods from Colombia, as well as enact other punitive measures on the Colombian government. U.S. consumers might have to pay more for coffee, crude oil and cut flowers from Colombia.
Second winning week for U.S. stocks
Major U.S. indexes retreated on Friday, but still ended the week higher, their second consecutive week of gains. The pan-European Stoxx 600 edged down 0.05%, but ended the week more than 1% higher. Burberry jumped around 10% on a shallower-than-expected dip in sales in the fiscal third quarter, while Ericsson fell more than 12% after the company missed estimates for its fourth-quarter earnings.
New high for Alphabet
Alphabet shares closed on Friday at $200 for the first time on a split-adjusted basis. The company implemented a 20-for-1 stock split in 2022. At that time, the stock was trading at about $2,750, equivalent to $137.50 after the split. Morgan Stanley analysts highlighted on Friday opportunities presented by Alphabet’s artificial intelligence agent products.
Mega Meta investment
Meta CEO Mark Zuckerberg on Friday announced the company plans to invest around $60 billion to $65 billion in capital expenditures in 2025. Meta is also building an AI engineer that will contribute “increasing amounts of code to our R&D efforts,” Zuckerberg added. After the announcement, Meta shares closed at $647.49, a new all-time high.
Trump’s intentions with TikTok
Trump is making a deal to save TikTok’s operations in the U.S., Reuters reported, citing two people with knowledge of the discussions. The sources said the deal would involve Oracle. However, in comments made to reporters on Air Force One on Saturday, Trump denied Oracle’s participation, and said “very substantial people” are talking to him about buying TikTok. One of the parties could be Perplexity AI, which revived its proposal to ByteDance.
[PRO] Earnings dominate week
Meta Platforms, Microsoft and Tesla announce their earnings on Wednesday, followed by Apple on Thursday — analysts think the reports could determine the direction of markets. Meanwhile, the U.S. Federal Reserve concludes its meeting on Wednesday, when investors will scrutinize Chair Jerome Powell’s comments for hints on the path of interest rates.
The bottom line
The S&P 500 has been shuffling sideways since its post-election jump in November —in fact, it ended 2024 lower than where it was at in the beginning of December.
There are signs the markets are finally awakening from their hibernation. While some of the Magnificent Seven stock struggled on Friday, both Alphabet and Meta Platforms ended the day at all-time highs on optimism around their AI offerings.
And even though all major U.S. benchmarks slipped on Friday, they still ended the week higher for the second consecutive time. The S&P and Nasdaq Composite each rose around 1.7% last week, while the Dow Jones Industrial Average climbed 2.2%.
The S&P closed at a fresh high on Thursday and etched a new intraday peak during Friday’s session. Impressively, it only took eight sessions for the index to rally from a two-month low to a record high, noted Sundial Capital Research founder Jason Goepfert.
That rapid turnaround suggests that investors are growing convinced that the bull market is trotting back.
Some of that sentiment can be traced to Trump’s remarks at the World Economic Forum in Davos, Switzerland, such as his pledge to “demand that interest rates drop immediately” and comment that he would “ask Saudi Arabia and OPEC to bring down the cost of oil.”
Lower interest rates, in general, boost economic activity, while cheaper oil reduces costs for businesses.
But some analysts are worried investors might be cheering a mere phantom.
“So far, markets have reacted to every statement made by the President, even those that should not have any impact,” said Mark Malek, chief investment officer at Siebert. “This shows that traders have not yet settled into their pace.”
Indeed, perhaps a more realistic sentiment of the markets can be interpreted from gold prices. Spot gold prices rose on Friday to their highest levels in almost three months, signaling that some investors are turning to the precious metal for safety amid uncertainty.
For those chasing the bull market, it might pay to first listen to what the bullion has to say.
— CNBC’s Alex Harring, Yun Li and Sarah Min contributed to this report.
