Shoppers at a produce store in Chinatown in San Francisco, California, US, Monday, January 6, 2025.
David Paul Morris | Bloomberg | Getty Images
This report is from today's CNBC Daily Open, the international markets newsletter. CNBC Daily Open keeps investors informed 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
Inflation fears are dragging US markets lower
US stocks fell and Treasury yields rose On Tuesday, the ISM Services Index A Big jump in prices For the month of December. Asia Pacific markets It traded mixed on Wednesday. The KOSPI index in South Korea rose by 1.3%. It was boosted by shares of Samsung Electronics, which rose about 3.6% even with the company Climate prediction Fourth-quarter earnings will come in lower than LSEG's expectations.
Meta is ending its fact-checking program
dead Tuesday Announce It will Eliminate third-party validation software “to restore freedom of expression” and move to a “Community Feedback” form, similar to the system on Elon Musk’s X platform. Employees moved to their own internal forum and He criticized the company's decisionThis is two weeks before the inauguration of US President-elect Donald Trump.
Anthropic's potential valuation is $60 billion
Anthropic, the AI startup founded by former OpenAI executives, At a late stage in the talks CNBC confirmed to raise up to $2 billion at a $60 billion valuation. Lightspeed Venture Partners is leading the funding round, according to a person familiar with the matter. Anthropic, which has been strongly supported by Amazonis the creator of the chatbot Claude.
India could benefit from Trump, portfolio manager says
It appears that US President-elect Donald Trump's plans to impose hefty tariffs on China are still in place Geopolitical position of India “Favourable in this era of Trump 2.0,” according to GIB Asset Management Portfolio Manager Kunal Desai. Desai said India is an attractive investment destination due to its monetary sovereignty and improved return on equity.
(PRO) Warning signs in the stock market
Howard Marks, co-founder and co-president of Oaktree Capital Management, who predicted the dot-com bubble, attests: Five warning signs In the stock market. While Marks does not call it a bubble, he is concerned about signs of froth in stocks. Here's what investors should pay attention to, according to Marks.
Bottom line
In a sign of how concerned investors are currently about the return of inflation, Institute for Supply Management Services Indexan inflation reading usually secondary to more important data points such as the Consumer Price Index, sends shock waves through the market.
The December ISM report's price index jumped to 64.4% from 58.2% in November, representing an increase of more than 10%. Steve Miller, chair of the ISM Business Survey Committee, noted that this is the first time since January 2024 that the reading has exceeded 60%.
This may be just the beginning of an unwelcome upward trend. Miller attributes some of the expansion in services activity to “risk management of the effects of potential port strikes and tariffs” – both of which generate inflationary pressures.
In response, investors pushed higher 10-year Treasury bond yield To 4.699% during the American trading day, the highest level since April 26. They also lowered their expectations for a rate cut by 25 basis points at the US Federal Reserve's January meeting, pricing in a 4.8% chance of that happening, down from a previous forecast. 8.6% probability just one day ago, according to FedWatch from CME Group tool.
Stocks suffered. the Standard & Poor's 500 It decreased by 1.11% Dow Jones Industrial Average It decreased by 0.42% Nasdaq Composite The index fell 1.89%, affected by the decline in technology stocks. Nvidia It fell 6.2%, breaking its three-day winning streak.
“You're getting a recalibration of inflation expectations and Fed rate expectations,” said Tom Heinlein, chief investment strategist at U.S. Bank's Asset Management Group. “That has sparked a small sell-off in equity markets after previous enthusiasm.”
The strong ISM report also indicates that the U.S. economy remains in good shape, providing fertile ground for earnings growth, Heinlein said. As David Lefkowitz, head of U.S. equities IT at UBS, wrote in a note on Monday, “earnings growth matters more” than assessing returns over the next 12 months.
A single data point from a single measure of inflation does not determine the path of inflation or the health of businesses for the coming year. But it's worth treading carefully for now.
— CNBC's Jeff Cox, Sean Conlon, Piya Singh and Lisa Kailay Hahn contributed to this report.
