Five International Developments to Know Before the Market Opens This Week
U.S. stock futures rose on Monday, with S&P 500 futures reversing earlier losses to climb 0.2%, while Brent crude fell 0.7%. More than 70 S&P 500 companies—including Tesla and Meta—are set to report earnings this week, a crucial test of whether massive investments in artificial intelligence (AI) will yield sufficient returns. Here are five key international and cross-strait developments to watch as the week begins:
PHLX Semiconductor Index Falls for Eighth Consecutive Session; TSMC ADRs Slide; Focus Turns to Meta and Tesla Earnings
U.S. stocks declined last Friday, with international oil prices nearing $110 per barrel, intensifying concerns over inflation and interest rates. The PHLX Semiconductor Index (SOX) plunged 3.8%, marking its eighth straight day of losses and an 11% drop for the week. TSMC’s American Depositary Receipts (ADRs) fell 2.2% on the day—their third consecutive daily decline—and ended the week down nearly 9%. For the week, the Nasdaq fell 4.5% and the S&P 500 dropped 1.9%—the latter marking its worst weekly performance since June—while the Dow Jones Industrial Average managed a 0.7% gain.
Rising oil prices and growing concerns regarding the debt levels of AI-focused companies have fueled fears that high borrowing costs could slow down AI-related investments. TSMC’s earnings report failed to stem the sell-off, as investors remain focused on whether the company’s clients can continue to secure funding. This week’s earnings from Meta, various chipmakers, and Tesla will serve as a litmus test for whether corporate profits can sustain the AI boom.
Meanwhile, the Federal Reserve has entered its “blackout period” ahead of the policy decision on the 28th, and deteriorating U.S.-Ukraine relations have added further risk. Analysts suggest that Asia—highly sensitive to shifts in chip demand, energy prices, and interest rates—could face a more significant impact.
P/E Ratios Have Fallen—So Why the Fear of an AI Bubble? Howard Marks Points to Warning Signs in Widespread Market Exuberance
An increasing number of professional investors worry that the AI frenzy is pushing the stock market toward a bubble; the 5.5% drop in the Nasdaq 100 index last week reflects this growing market unease. Unlike the dot-com bubble era, strong earnings growth projections have actually caused the forward price-to-earnings (P/E) ratios for the S&P 500 and Nasdaq 100 to decline this year. The average forward P/E for the five largest tech stocks currently sits at approximately 23x—well below the ~65x seen in the month leading up to the market peak in 2000.
Market concerns center on high debt levels, potentially unsustainable earnings expectations, and investment mania. Howard Marks, co-chairman of Oaktree Capital—a firm renowned for its analysis of market cycles and investment risk—notes that one hallmark of a bubble is when investing becomes a widespread craze, leaving those on the sidelines with a sense of regret, while the appetite for risk and overall market sentiment become detached from reality.
Anthropic’s Debt-Financing Push: Higher Borrowing Costs Reflect Investor Demand for a Larger Risk Premium
Anthropic is planning to raise $60 billion in debt financing through “Project North Star” to procure Tensor Processing Units (TPUs) developed by Google—totaling roughly 1.5 gigawatts (GW) of computing capacity—in what is expected to be the largest chip-related financing deal to date.
According to the Financial Times, citing people familiar with the matter, a fund managed by Blackstone will invest $9 billion—half of the subordinated debt—at a yield exceeding 10%. The loan will be repaid using the rental payments Anthropic makes for the chips over the next five years. The high cost of borrowing reflects investors’ demand for a larger risk premium given the massive capital requirements of the tech sector; the deal serves as a key litmus test for the intensity of AI-related financing.
Zelenskyy Accuses Trump of Pressuring Ukraine to Surrender; Cites Starlink Throttling and Delayed Missile Deliveries
In an interview with Bloomberg on Sunday, Ukrainian President Volodymyr Zelenskyy accused the U.S. of intentionally throttling Starlink internet speeds and delaying the delivery of Patriot interceptor missiles—moves he claims are intended to pressure Ukraine into surrendering to Russia. Zelenskyy stated that he had proposed halting attacks on Russian oil refineries in exchange for more Patriot missiles to protect Ukraine’s energy infrastructure, but alleged that the U.S. side merely demanded a cessation of the strikes.
Meanwhile, Donald Trump recently agreed to refrain from further tightening sanctions against Russia in exchange for an increase in Russian diesel supplies—a move aimed at lowering oil prices that has sparked backlash within the Republican Party. He argued that this move was intended to prevent Putin from withdrawing from peace talks, while conversely accusing Zelenskyy of seeking to prolong the war. Zelenskyy, for his part, hopes that relations between the two sides might ease following the U.S. midterm elections.
Violent Clashes Erupt as 500,000 Protest in France; Century-Old City Hall Set Ablaze; Macron Calls for Restoration of Order
On Saturday, more than 500,000 people took to the streets across France to protest poor conditions in education and healthcare, as well as the soaring cost of living. The demonstrations descended into clashes between protesters and police, accompanied by looting and arson. A total of 2,397 individuals were arrested, and approximately 1,000 police officers and firefighters sustained injuries. In Limoges, a 143-year-old city hall building was destroyed by fire.
发送反馈