Market Analysis & Stock News: January 2nd 2025

American markets closed the day lower, although they managed to recover somewhat from earlier lows. U.S. stocks had started the day with gains but reversed sharply in afternoon trading as sentiment shifted negatively. The abrupt sell-off was attributed to mixed economic signals and investor caution as traders recalibrated their outlook for the year ahead.

European Markets

European markets marked a robust start to 2025, with strong gains during their first trading session. Energy stocks led the charge, fueled by optimism about stabilizing global energy prices and renewed interest in the sector.

The UK’s FTSE 100 started the year on a strong note, rising 1.07% to its highest level in over two weeks and posting its best daily performance since November 22. Gains were led by precious metals miners, which surged 4.6% as gold prices climbed on safe-haven demand and falling U.S. Treasury yields..

Chinese markets ended the day sharply lower, marking their weakest start to a new year since 2016. The drop was driven by disappointing factory activity data, which raised concerns about the health of the world’s second-largest economy. Investors are increasingly looking for more robust policy support from the Chinese government to stabilize growth and support struggling sectors.

Corporate Stock News

Alibaba Group Holding Ltd:

• Agreed to sell its 78.7% stake in Sun Art Retail Group to DCP Capital for $1.58 billion.
• Originally acquired for $3.6 billion in 2020, Sun Art shares have risen 85% in the past year.

Apple Inc:

• Offering discounts of up to $68.50 on iPhone 16 models in China from Jan. 4-7.
• Move aims to defend market share amid rising competition from domestic rivals like Huawei.

AP Moller-Maersk:

• Urged customers to collect laden containers and return empties at U.S. East and Gulf Coast ports by Jan. 15 to prevent disruptions due to a potential strike.

Bank of America Corp & Citigroup Inc:

• Exited the Net-Zero Banking Alliance, citing progress on individual net-zero goals and avoiding conflicts with U.S. Republican policymakers.

BCE Inc:

• JPMorgan lowered its target price to C$35 from C$41, citing slowing immigration growth and its impact on Q4 mobile phone volumes.

Biogen Inc:

• Piper Sandler downgraded rating to neutral from overweight.
• Cited revenue dependence on shrinking multiple sclerosis treatments and slow progress in Alzheimer’s research.

BP Plc:

• Announced first gas production from the GTA offshore project in Senegal and Mauritania.
• Expected to produce 2.3 million tonnes of LNG annually in its first phase.

Eastgroup Properties Inc:

• Jefferies upgraded rating to buy from hold.
• Highlighted exposure to onshoring trends and strong leasing strategy.

Rio Tinto Plc:

• Reported a deck fitter missing from a bulk carrier en route from China to Western Australia.
• Philippine Coast Guard leading the search and rescue operation.

Simon Property Group Inc:

• Jefferies raised target price to $198 from $179.
• Cited strong net operating income growth despite e-commerce competition.

Softchoice Corporation:

• Canada raised its target price to C$24.50 from C$23.
• Reflects acquisition by World Wide Technology Holding.

Sofi Technologies Inc:

• KBW downgraded Sofi’s rating to underperform from market perform.
• Highlighted challenges in achieving long-term business outlook despite near-term catalysts.

Telus Corp:

• JPMorgan cut its target price to C$22 from C$23 due to lower Q4 phone net additions linked to population growth slowdown.

Tesla Inc:

• Cybertruck explosion outside Trump International Hotel in Las Vegas killed one and injured seven.
• FBI investigating potential terrorism; Musk confirmed explosion unrelated to the vehicle.
• Stock fall in trading, down 6 percent as a result.

Vodafone Group Plc:

• Swisscom completed an €8 billion acquisition of Vodafone Italia.
• Merger with Fastweb expected, with up to $207.2 million costs impacting 2024 financials.