Global Market News

Global equities make gains

Global equities made gains this week amid generally upbeat earnings, though trading was choppy given sticky inflation readings. The S&P 500 rose 2.67% while the Dow Jones increased 0.67% and the Nasdaq climbed 4.23%. The US 10-year Treasury note closed Friday at 4.66% but had traded as high as 4.735% on Thursday. The price of a barrel of West Texas Intermediate crude oil rose slightly, closing at $83.66. Volatility, as measured by the CBOE Volatility Index, declined over the week from over 18 to 15.03.

South Korea posts stronger-than-expected growth

South Korea’s economy expanded at a 3.4% year-over-year pace in the first quarter, accelerating from the previous quarter’s 2.2% growth. This growth rate for Asia’s fourth-largest economy exceeded expectations as exports maintained steady growth (driven by global demand for semiconductors), private consumption picked up, and construction investments expanded. According to the International Monetary Fund (IMF), Asia will contribute roughly 60% of global economic growth this year.

Updated Market Figures

International Developments

US begins construction on Gaza aid pier; Campus protests spread through country

The US military has begun the construction of a large floating pier off the coast of the Gaza Strip to facilitate the delivery of humanitarian aid. Officials estimate that the pier, which will allow for ships to transport supplies from Cyprus, will be operational by early May. The system will aim to deliver up to 150 trucks of aid per day, which would include around two million meals. Israel has pledged to provide security and logistical support during the construction. In the US, protests against Israel’s campaign in Gaza have spread throughout university campuses, including high-profile institutions such as Columbia, with students demanding that the schools cut financial ties to Israel. Incidents of both antisemitism and Islamophobia have increased since the beginning of the war, and school administrators have been called on to resign for failing to contain the protests.

Macron calls for ‘Strategic Autonomy’ from US

French President Emmanuel Macron has continued advocating for a stronger, more integrated Europe in the realms of defense and economics. He has called for increased investment and focus for higher production of European military equipment, military training, and enhancing Europe’s cybersecurity capabilities. On the economic side, he called for greater investment in advanced technologies such as artificial intelligence, quantum computing, biotechnologies, and renewable energy.

US troops leave Chad

A number of US special operation forces are being withdrawn from Chad, marking the second significant setback in recent days for US security and counterterrorism efforts for the volatile region of West and Central Africa. The announcement of withdrawal from Chad comes days after officials said that over 1,000 US military personnel will be withdrawn from Niger, as the Pentagon is responding to demands from African governments. The drawdown in US military forces comes amid an upswing in military partnerships between African governments and Russia, which often offers more flexible terms for security assistance.

US Social & Political Developments

Foreign aid bill signed into law

President Joe Biden signed a $95 billion foreign aid bill after the Senate approved it, following the bill’s approval in the House of Representatives. The bill, which had languished in the House due to conservative dissidents in the Republican caucus, includes over $60 billion in aid to Ukraine which consists of equipment such as anti-aircraft missiles, artillery, infantry fighting vehicles, and other weapons and ammunition. The US military had prepared much of the weaponry so that it can be quickly delivered to Ukrainian troops, who have faced shortages of equipment and ammunition while defending against Russian forces this year.

Blinken visits China

US Secretary of State Antony Blinken visited Shanghai, China, to discuss a myriad of issues related to bilateral diplomatic relations between the US and China. Blinken said he raised the issue of election interference from China on the upcoming US presidential elections, saying that the US has seen evidence of such attempts from China in the past. Other issues involve the bill to force TikTok parent, Chinese-based ByteDance, to divest from the app, economic relations between the two nations, and military concerns. He also met with business leaders, students, and traveled to Beijing to meet with his counterpart, Foreign Minister Wang Yi.

Corporate/Sector News

Big Tech’s AI investments mostly pay off

Big Tech firms recently released earnings reports that excited investors. Alphabet and Microsoft reported earnings that beat expectations, with the momentum driven by their investments in new technologies, especially artificial intelligence. Alphabet’s stock rose double digits on Thursday, also rewarding investors with the company’s first dividend. Microsoft rose more than 4% on Thursday, with earnings boosted by AI adoption in its cloud services. Not all Big Tech benefited from AI investment, however. Meta’s earnings, while mostly meeting expectations, caused a slip in stock prices given its massive investment in AI. Many analysts were not alarmed by the slip, with some believing that Meta’s slide was somewhat expected given its constant upward performance since October 2022.

Over half of EVs in 2023 were made in China

It has been reported that over half of all electric vehicles (EVs) made in 2023 were made by Chinese automakers, a development which further solidifies China’s dominance in the market. China-based BYD, for instance, manufactured over 3 million units in 2023, surpassing Tesla’s output for the second year in a row. Chinese brands have accelerated their exports, seeking growth outside of the country’s domestic market and making trouble for competitors abroad who are yet unable to manufacture EVs at scale with a comparative price point.

Construction begins on first high-speed railway in US

Brightline West has officially broken ground for a new high-speed rail system, connecting Las Vegas and Southern California. The project received $3 billion in funding from the Bipartisan Infrastructure Bill, and plans to connect cities that are too short to fly and too far to drive. The 218-mile rail system will be constructed within the median of I-15 in order to minimize crossings. The system, which would be fully electric, is expected to cut carbon emissions from driving by 800 pounds a year. Full operations could begin as soon as 2028, with the goal of opening before the 2028 Summer Olympics in Los Angeles.

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