Notable market news this past week (17-Mar-24)
Here is the Skeptivest roundup of the latest market headlines for the week
🇮🇳 India undergoing a major infrastructure overhaul under Modi
India’s Travel Boom: Over the past 3 years, domestic flights within India have more than doubled. The country is investing $12b into building more than 72 new airports by 2025 including a $2.1b Navi Mumbai airport project.
India’s Infrastructure Overhaul: The project reflects a broader initiative to positionIndia as a global aviation player, with capacity for 90m passengers by 2032. The airport's strategic location and ambitious design aim to establish it as a major international transit hub. Authorities are also building new bridges and roads to provide critical connectivity to the new airport.
Modi’s ambition for India to be a developed nation by 2047: The infrastructure overhaul aims to boost foreign investment and spur economic growth. However, India may be up against stiff competition from the likes of Singapore’s Changi Airport orLondon’s Heathrow. The new facility will also need to solve logistical issues and have ample flights slotted in to compete
☕️ Quick fire happenings to note
🌏 Global macro
- US core inflation beats forecast: Core CPI increased to 0.4% from Jan, unwelcome news for the Fed but underlying components still indicate a promising trend in inflation. The market does not expect February’s CPI report to alter the Fed’s plans to keep interest rates higher for longer to slow inflation, but the Fed needs to see more compelling evidence that inflation is slowing in upcoming data releases before beginning to cut interest rates.
- Japan’s wage results may spur BOJ to end the world’s last negative rate: Japan workers secured the largest pay hike in more than 30 years averaging at 5.28% compared to 3.58% in 2023. While yen strengthened after the news was released, the currency reversed gains amid broad strength in the dollar. This shows market players are not entirely convinced how BOJ will react for its monetary policy next week
- PE firms are buying up collateralised debt: Asset-based finance can be repackaged into complex instruments with investment-grade credit ratings that can then be sold to major institutional investors like pensions and endowments, offering private equity a new channel of growth. By the end of2022, private fund managers had already raised around $1.5 trillion from clients to invest in private debt.
🏦 Individual stocks/companies
- Nvidia rallies for 10th consecutive week: Nvidia gained about 80% over the 10-week rally. The streak is an example of how investors have continually bid up the company amid sky-high demand for chips used in artificial intelligence
- Apple buys Canadian AI startup: Canada’s DarwinAI was quietly acquired earlier this year as Apple looks to add features to its iOS 18software that rely on generative AI. An announcement is expected in June during the company’s worldwide developers conference.
- US house passes Bill possibly forcing TikTok ban: US House of Representatives passed a bill to ban TikTok in the US unless Bytedance sells the video-sharing app. The Bill still needs to pass in theSenate and get a presidential signature before it becomes a law. TikTok plans on fighting the bill’s passage through the Senate and exhausting every legal option first as Divestiture is the company’s last resort.
- Ikea plans to spend $327m in South Korea to win market share: To do so, Ikea is seeking to increase consumers’ access to stores. The company believes that Korea has one of the highest quality of last-mile deliveries and has in recent years invested on improving automation of its shipping service, which can lead to lower prices. The brand is planning to cut prices globally, and is looking at 10% to 20% reductions for key products inSouth Korea.
🇸🇬 Singapore related
- CPF interest rate dips: Interest rate for CPF Special, MediSave and Retirement accounts will dip to 4.05% for Q22024. This is down from 4.08% in the previous quarter and marks the first decrease in the interest rate for Special and MediSave accounts after three consecutive increases. The Ordinary Account interest rate will remain at 2.5%.
