>>> Barrons Week-ends Summary

Cover:
-The 2025 Barron's Roundtable includes a divided group of bearish and optimistic panelists. The bears expect 2025 to be more challenging for markets than 2024, due to levitating bond yields, inflation fears, and levitated equity valuations. The pessimists worry about the growth of government debt and policy uncertainty in Washington DC, especially with the incoming President Trump's sea change. On the other hand, optimists expect stocks to continue rising due to a strong economy, double-digit earnings growth, government deregulation, mergers and acquisitions, and the widespread adoption of artificial intelligence. Despite the negativity, most investment pros offered up more stock picks than usual, suggesting that the market may be overpriced but many stocks are cheap.

Interview:
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Tech Trader:
-Nvidia's shares fell 6% on Tuesday (Dec. 7) after no new details about its next-generation AI data center processors were revealed at CES. The rumors were silly, as Nvidia traditionally reveals information on its data center products during its annual GTC developer conference. Huang announced Nvidia's new line of RTX 50 Series gaming graphics cards, which include the latest version of Deep Learning Super Sampling. He also announced Project Digits, a desktop computer with a new GB10 Grace Blackwell Superchip and a Nvidia-designed Arm-based processor capable of delivering up to one petaflop of AI performance. Digits will be available in May, starting at $3,000. The computer uses a scaled-down version of Nvidia's Grace AI server CPU and is packaged in a Mac Mini-sized form factor with Taiwan-based MediaTek.

The Trader:
-The bond market is currently in control, leading to a sharp drop in major stock indexes on Friday. The monthly jobs report, which came in hotter than expected, sent bond yields soaring, causing investors to fear that the Federal Reserve will keep interest rates high or raise them to prevent inflation. The 30-year Treasury note yield briefly rose above 5%, its highest level since November 2023. The Dow Jones Industrial Average fell by 1.6%, the S&P 500 index closed down by 1.9%, and the NASDAQ Composite fell by 2.3%. This move erased all of the market's 2025 gains. However, good economic news is still good news, as more Americans with jobs will be able to spend more money, as 70% of the US economy relies on consumer spending. Although inflation remains above the Fed's long-term goals, there are few signs that it will start raging again.
-Jefferies Financial Group reported its earnings, indicating a strong earnings season for US financial institutions. Profits rose by 212% to $205.7M, missing analysts' forecasts for $245M and 97 cents, respectively. Revenue jumped 63% to $1.96B, surpassing analyst estimates for $1.8B. Jefferies' investment banking business saw a record quarterly revenue of $596.7M from advisory work for clients. Overall investment banking revenue reached $3.4B in 2024, its second-highest annual figure. Jefferies' CEO Richard Handler and President Brian Friedman expressed satisfaction with the firm's position in 2025. However, the stock dropped 11% on Friday, its largest drop in five years, likely due to a stronger-than-expected payrolls report suggesting the Fed may be done cutting interest rates. Despite this, shares have nearly doubled over the past year, surpassing the S&P 500's 24% rise.

Features:
-Investors are betting that the Supreme Court will uphold a law that would ban TikTok by late next week. The video-sharing social-media app delivered oral arguments in its defense before the Supreme Court on Friday. Shares of Meta and Snap jumped as the Supreme Court began to hear arguments from TikTok lawyers and the US government. Lawmakers on both sides of the political spectrum have criticized TikTok, citing national security concerns and worries about its Chinese parent company, ByteDance. The consensus after the arguments ended seems to be that the Court won't. TikTok attorney Noel Francisco argued that the Supreme Court needed to convince the Supreme Court that the company doesn't pose a risk to national security and banning it would be a violation of users' free-speech. TikTok wouldn't be banned in the US if it divested from Chinese parent company ByteDance.
-The incoming Trump administration has been warned that the economy is healthy, despite some inflation. The biggest concerns are not from the economy itself but from concerns about government policy. The employment report showed 256,000 jobs created in December, above expectations, which sent the S&P 500 and other major stock indexes down and the 10-year Treasury yield up. This good-news-is-bad-news reaction came as investors and traders were reconsidering the possibility of the Federal Reserve lowering its main policy rate this year. The economy looks set for 3% growth and 3% inflation. Trump has assailed Fed Chair Jerome Powell over current rate levels, stating that interest rates are far too high. The high interest rates on consumer debt are more due to bond traders' assessments of future growth and inflation than the Fed.

Europe:
-HSBC analyst Erwan Rambourg believes that LVMH Moët Hennessy Louis Vuitton could not see a real rebound in its sales figures, as the luxury sector has been struggling for so long. The company's share prices have sagged even as the broader market reaches new highs. However, Rambourg argues that 2025 may mark a turning point for luxury, and the market will react swiftly to any sign that sales have bottomed. If that's the case, it makes sense to buy the stock ahead of the results, leading him to reiterate a Buy rating and raise his price target by €20 to €747 (about $765). Rambourg is also not concerned about recent management changes at the firm, as CEO and controlling shareholder Bernard Arnault has a mandate to remain at the helm until he's 80, making succession a less urgent question. Meanwhile, Barron's has argued that LVMH finally looks like a buy, as Chinese sales could start to rebound, Arnault scooped up more than $100M in stock, and the shares look inexpensive following their 2024 slump. Analysts have gotten less pessimistic, with 71% rating it at Buy or the equivalent, up from 64% this summer.

Emerging Markets:
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Commodities:
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Streetwise:
-The US stock market is largely dependent on chip designer Nvidia, Taiwan Semiconductor Manufacturing, and Dutch company ASML Holding, which is the leader in lithography. All three companies have made significant contributions to investors over the past decade, with Nvidia shares returning 29,000%, Taiwan Semi's American depositary receipts 1,100%, and ASML's ADRs 800%. However, Nvidia and Taiwan Semi are trading close to their highs, while ASML is down by nearly a third from its peak last summer. This could be an early warning for chips and the US stock market, or ASML losing its monopoly on high-end lithography. ASML's machines can print 13-nm resolutions, which chip makers can turn into even smaller features to achieve their current 7-nm, 5-nm, and 3-nm "nodes." A nanometer is roughly how long a fingernail grows in a second, while a human hair is 80,000 to 100,000 nanometers wide.

FT : The utterly plausible case that climate change makes London much colder

The utterly plausible case that climate change makes London much colder
For some climate scientists, global warming threatens Britain with a more unexpected scenario

It’s a winter’s day late this century and London is engulfed in a December blizzard, its third of the season. The air is sharp with ice. Oxford Street is deserted. For nearly two days, Heathrow’s runways — all four of them — have stood empty. Visibility on the roads is near zero.

In the following months, many English football pitches will lie idle, the groundsmen having given up trying to protect the surfaces from the elements. Bookmakers no longer take bets on a white Christmas: the probabilities have shifted too far.

This future is so much colder — and indeed so much drier — that British farming has dramatically shrunk. The complaints of the 2020s, such as Brexit and farm taxation, turned out to be minor shocks compared to the rapid cooling of the following decades. A proposal for irrigation — piping water from Scotland southwards — was deemed too expensive. The land of the second agricultural revolution no longer grows crops at scale.

Restaurants do not boast of local produce. Nearly all the UK’s vegetables and fruits are imported, as are its wheat, oats and sugar. To make matters worse, fish stocks have collapsed in the north Atlantic.

This future Britain has adapted to some aspects of the cold and dry. After a hiatus in the early 21st century, the country did build new reservoirs. Even in summer, when rain doesn’t arrive, London does not run short of drinking water.

But infrastructure is not Britain’s strong point. Despite efforts to learn from Scandinavia, its rail network cannot withstand the cold. Disruption is constant. The wealthy insulated their houses but millions of homes and offices, not to mention schools and hospitals, remain suited only to the old, moderate winters that now rarely occur.

To predict the future, at least in any meaningful way, requires both science and imagination. For decades, the scientific advice has been that the world should brace for a warmer climate. By 2050, according to one study, London’s summers will resemble those of Barcelona. Already temperatures of 40C have led to the installation of air conditioning and water fountains. But for a growing group of scientists, another scenario is becoming increasingly plausible.

One day, possibly in our lifetimes, the temperature could start to drop in northern Europe. When this is forecast in isolation, without the offsetting warming effects of climate change, London would end up as much as 10C colder. Once climate change is taken into account, the scenario is for London’s average temperature to rise and then gradually fall, ending up perhaps 2-3C cooler than before industrial times. Such a shift may not sound dramatic. But the storms, wildfires and heatwaves of recent years have taken place on an average temperature shift of just over 1C. As averages move, the extremes become more extreme.

What’s more, recently published modelling estimates that the cooling could start in the next couple of decades, although it would take perhaps a century to play out in full.


One of the most alarming — and uncertain — fields of climate research, the explanation lies in the oceans. Today, currents known as the Atlantic Meridional Overturning Circulation (Amoc) bring vast amounts of water from the tropics to the northern regions. The Amoc is a conveyor belt or perhaps a central heating system. The warmth that it transfers from south to north is about 50 times all the energy that humans use.

In places, the Amoc forms part of the Gulf Stream. It represents about one-fifth of the water that the Gulf Stream transports, but most of the heat. It keeps London several degrees warmer than places at similar latitudes, for example on the Pacific coast of Canada. In recent decades, however, those currents have been weakening. A point may come when they no longer circulate. They may pass a tipping point, beyond which there is no return.

A full collapse of the Amoc would be a “massive, planetary-scale disaster”, says Stefan Rahmstorf, a climate scientist at Germany’s Potsdam Institute and one of the world’s leading experts on the system. “It is quite difficult to know exactly what the impacts will be, but my feeling is that they will be quite devastating.”

They would certainly be global. An Amoc collapse would push the band of rainfall around the equator southwards, damaging some of the Earth’s most vital ecosystems and the food security of billions of people in Africa and Asia. Heatwaves in mainland Europe would worsen: as the north Atlantic cooled, hot air from the south would be stuck there.

As for the UK, “in simple terms, [it would be] fundamentally less habitable than it is at the moment”, says Tim Lenton, a professor of climate change at the University of Exeter.

The IPCC, the intergovernmental body whose reports on climate change are taken as gold standard, has long downplayed the risk of Amoc collapse. Rahmstorf once agreed. The possibility of passing the tipping point in the next century was below 10 per cent. But new research changed his mind. Last August, he told CNN that the risk was “probably even greater than 50 per cent”. He and Lenton are part of a network of scientists who complain that an existential threat is being overlooked. If they are right, then climate change could be even more disruptive than we are currently planning for.

A tidy, bespectacled 64-year-old, Rahmstorf started studying the Amoc in the 1990s. His focus was on the distant past. Sediment samples and Greenland ice cores revealed that the climate underwent abrupt changes more than 25 times in the last ice age, which ended some 11,000 years ago. Northern Europe had seen dramatic changes in vegetation, in periods that North America had not. Antarctica had warmed by between 8C and 16C in just 50 years, while the northern hemisphere had cooled. Both pointed towards the Amoc as the likely culprit.

In 1987, Wally Broecker, a pioneering geochemist and a key influence on Rahmstorf, warned that global warming could lead to an Amoc collapse. “We play Russian roulette with climate, hoping that the future will hold no unpleasant surprises,” he wrote. “No one knows what lies in the active chamber of the gun, but I am less optimistic about its contents than many.”

Experts largely agreed with Broecker’s suggestion. They also agreed that global warming increased the chances of it happening. This is because the saltier water is, the heavier it is. Today the Amoc brings warm, salty water from the subtropics northwards at the surface. Some of the warm water evaporates as it meets cold air over the north Atlantic; the remaining water is so salty that it sinks to a depth of 2,000-3,000 metres. (It has also cooled, making it heavier again.) The downwards flow is equivalent to 6,000 Olympic swimming pools, every second.

The water returns southwards at this depth for thousands of miles, past Brazil. But if the north Atlantic changes — with more freshwater from rainfall or from melting ice — then the flow no longer becomes so salty and heavy. The conveyor belt slows down. At some point, the system passes a tipping point. The Amoc shuts off completely. The question was how likely was a collapse, and when might it happen?

In 2004, the disaster movie The Day After Tomorrow imagined an Amoc collapse. In it, much of the northern hemisphere is gripped by a new ice age. The filmmakers played loose with the science. In the movie, the Amoc collapses within days (in reality, scientists estimate it will take up to a century for the effects to play out) and a tsunami hits Manhattan (an Amoc collapse would have no such effect). Rahmstorf wrote a review of the film on his blog, urging scientists not to dismiss it despite the artistic licence taken. He also spoke to the screenwriter, Jeffrey Nachmanoff, at a preview of the film. “He told me, ‘If we were making films for a few million people, we would stick to the law of physics, but we are making films for a few hundred million people, and there we stick to the law of Hollywood.’”

Rahmstorf was pleasantly surprised by Nachmanoff’s grasp of climate politics. The film conveyed basic truths. At one point a politician tells a scientist, “Maybe you should stick to science and leave policy to us.” The scientist responds, “Well, we tried that approach.” (The scientist works at the National Oceanic and Atmospheric Administration, the same institution where Rahmstorf held a post.) Like other climate scientists, Rahmstorf was used to being ignored.

By 2013, IPCC reports showed a map of the world with rising surface temperatures indicated by shades of orange and red. Global warming was happening fast. But, amid all the red, there was a surprising blob of blue, representing not rising but cooling temperatures. The blob was located around the Irminger Sea, in the north Atlantic, exactly where the Amoc should be transporting heat. The models used by the IPCC mostly did not predict the cold blob. Since the 19th century, the northern Atlantic was the only region in the world to have become colder. “I thought this must be Amoc, why doesn’t the IPCC discuss this? It was really staring into my eyes, but nobody seemed to make a big deal out of this,” recalls Rahmstorf.

Rahmstorf’s research had moved on to other aspects of climate change, but now he turned back to the Amoc. In 2015, he published a paper with the US climate scientist Michael Mann and others, which catalysed the idea that an Amoc slowdown was not a future possibility but a present-day reality. It concluded the Amoc had weakened and called it “an unprecedented event in the past millennium”. If Greenland’s ice sheet continued to melt, the Amoc would diminish further. Mann describes Rahmstorf as “a fiercely independent scientist and thinker, who has often proved ahead of his time”. A common theme in his research is that “key climate impacts are being observed earlier than predicted by most climate models”.

The problem with studying the Amoc is a lack of direct evidence. Precise measurements of the current, via a series of moorings with instruments stretching down thousands of metres, date back only to 2004. This is not long enough for scientists to disentangle any slowdown from short-term variation. (After 2012, for example, the Amoc strengthened.)

Instead scientists must look for indirect evidence, or “fingerprints”. One is sea surface temperatures, such as the cold blob. Temperatures were once measured by sailors dipping buckets over the side of their boats while crossing the Atlantic; this method continued well into the 20th century. Now satellites help. Using climate models, Rahmstorf and co-authors estimated that the Amoc had weakened about 15 per cent since the mid-20th century. Another fingerprint is the declining salinity of the Amoc. Salt concentrations are at their lowest for 120 years.

Think of a boxer losing a fight. Every time he gets knocked down, it takes a little longer for him to get back to his feet. Similarly, as natural systems near collapse, they often lose their resilience and take longer to return from short-term fluctuations to their previous equilibrium. One of Rahmstorf’s colleagues at the Potsdam Institute showed that the Amoc was exhibiting such a lack of resilience. The results helped to convince Rahmstorf that a collapse was more likely than had been assumed.

In 2023, two Danish scientists, the brother and sister team of Peter and Susanne Ditlevsen, identified increasing fluctuations in the sea surface temperature of the North Atlantic as evidence of a pending Amoc collapse. Their model concluded that the Amoc was likely to pass the tipping point, after which collapse is inevitable, between 2025 and 2095. The most likely year was 2057.

Another group, based at Utrecht University in the Netherlands, showed that a good indicator of potential Amoc collapse was the freshwater transported at the circulation’s southern boundary in the Atlantic. The modelling was gruelling. It “took us six months or so on a substantial chunk of the supercomputer in Amsterdam”, says Henk Dijkstra, the team’s leader. Their conclusion, published in February 2024, was that the Amoc “is on route to tipping”. Such stark findings caused headlines globally, including in the FT. For Rahmstorf, different modelling was now pointing to the same alarming conclusion.

In another paper, still undergoing peer review, the Utrecht group used salinity changes to put the start of collapse between 2037 and 2064. This study is currently undergoing a major revision, following critiques.

Indeed, within the scientific community, the most alarming warnings about the Amoc are fiercely contested. Niklas Boers, Rahmstorf’s colleague who authored pioneering studies into the Amoc’s loss of resilience, says that tipping time estimates don’t factor in uncertainties in the data records, or uncertainties about future emissions and how these affect the climate. It matters, for example, not just how fast Greenland’s ice sheet melts, but how much of the meltwater flows to the areas south of Greenland where the Amoc sinking happens. “I really don’t think we can make any safe estimates on this tipping time,” says Boers. When data uncertainties are factored in, he adds, the Ditlevsens’ model results in a tipping point that could be imminent — or as far as 6,000 years away.

Other scientists question how Rahmstorf and others use sea surface temperature in the north Atlantic as a proxy for the strength of the Amoc. How warm the water is may not accurately represent the flow, especially over short time periods. Denis Volkov, an oceanographer at the University of Miami, has studied the Florida current, part of the Amoc, through its effect on the voltage in underwater telecoms cables. He concluded that, at least over a short time period, the Amoc was slightly more stable than previously thought. The likelihood of a complete Amoc collapse is “still uncertain”, says Volkov, calling for more research.

The IPCC, which effectively sets the scientific climate consensus, remains conservative. It has warned that a weaker Amoc could “cause a decrease in marine productivity in the North Atlantic (medium confidence), and more storms in Northern Europe (medium confidence)…” among other effects. But its last big report professed only “low confidence” that the Amoc had declined last century. Although it was “very likely” that the circulation would now decline, the panel had “medium confidence” that there would be no abrupt collapse by 2100.

Rahmstorf blames the IPCC process: the lack of Amoc experts involved and the inbuilt biases in major climate models. Anecdotally, he heard that, when several climate models were first designed, “the Amoc collapsed even in present-day climate . . . What do you do as a climate scientist, when you compare your model result for present-day climate with observations [which contradict it]? You conclude it’s wrong, we must change this model. However, if by design your model has an Amoc that is too stable, everything looks fine. So there is asymmetry there — which model errors get fixed, and which model errors don’t get fixed.”


The models relied on by the IPCC do not include the effect of meltwater from Greenland changing the salinity of the North Atlantic. In November, a study by scientists in Sydney estimated that meltwater would be responsible for 40-50 per cent of the Amoc’s future slowdown, if the world did not dramatically reduce greenhouse gas emissions. And this was under an “optimistic” scenario, in which the Greenland ice sheet did not itself become rapidly more unstable. Greenland is the “big gorilla”, says Rahmstorf. “It’s not contributing a huge amount [today], but the share of meltwater from Greenland will increase as the world warms further.”

The IPCC concedes that climate models have such biases, which produce “unrealistic stability”, but says that this is taken into account in its conclusions. As a result, the panel “does not underplay the risk of Amoc collapse”, says Robert Vautard, a climate scientist and lead IPCC author. Nonetheless, its last major report only covered studies up to 2020; new research means the next report is likely to devote “significant space” to Amoc, he adds.

Rahmstorf has responded to some critics, but he also seems tired by resistance to the idea of looming Amoc collapse. “I have encountered a reluctance among colleagues to speak about uncertain risks, for fear of sounding alarmist.” He compares the risk of Amoc collapsing to the risk of a plane crashing. “You’re not going to ask, are you 99 per cent sure that it crashes . . . Even if the possibility of a shutdown happening is only 10 per cent, that is far too high to accept. And I now think it’s larger than 10 per cent.”

Lenton, of the University of Exeter, argues that scientists need to warn more about risks, given how the climate is already defying their expectations. “We sit after the end of more than 12 months of unprecedented sea surface temperatures and global average temperatures, and there isn’t a consensus in the scientific community as to why this is happening. Everyone’s got to have a bit of humility, and say, ‘Oh dear.’” Very unlikely scenarios are occurring. In 2021, the UK government’s climate risk assessment said the chance of Britain experiencing 40C heat by 2040 was “less than 0.02%”. That temperature was hit the following year.

In October, Rahmstorf, Lenton and 41 other experts signed an open letter, highlighting the possibility of an Amoc collapse this century. (Boers, who argues we can’t accurately predict when any tipping point will occur, also signed.) The letter also noted that the bigger possibility is that the Amoc passes the point of no return this century — and the effects fully unfold in the 2100s. The impact would be “catastrophic”, impacting “the entire world for centuries to come”. Rahmstorf presented the letter to Iceland’s climate minister. But is society capable of processing long-term, uncertain risks?

“In the long run, we are all dead,” said John Maynard Keynes. He wasn’t being flippant. Indeed, he was pushing back at economists’ tendency to downplay short-term suffering. The idea that society thinks too long-term is now almost funny. Companies fixate on their share prices. Politics works to the beat of the next election, in which future generations have no say. Economists’ accounting gives much less importance to future costs, thereby making long-term harm seem palatable. Scientific climate forecasts end at 2100, even though a baby born today in the west is expected to live beyond that date. Last September, in response to a parliamentary question, the UK government said it had not “assessed the effect of any slowing or collapse of the Atlantic Meridional Overturning Circulation (Amoc) on economic planning.”

The long-term thinking that does exist often doesn’t age well. Germany’s debt brake, justified as a way of stopping financial burdens being placed on future generations, has meant years of under-investment that the current generation is having to mop up. The Oxford philosopher William MacAskill, who championed long-term thinking, soon found his message tarnished by his close association with crypto entrepreneur Sam Bankman-Fried, now a convicted fraudster.

The warnings of catastrophic climate tipping points have not gone entirely unheeded. In September, the Advanced Research and Invention Agency, a new UK research agency, announced £81mn in funding for research into tipping points — including the Greenland ice sheet and the north Atlantic subpolar gyre, a system of currents that connects with the Amoc. The subpolar gyre is thought to be more vulnerable to collapse than the Amoc. Its effects would also hit Europe quicker.

The winning teams, to be announced in March, will be expected to develop new sensing systems, along with physical and statistical models. The hope is that the methods could then be extended to the Amoc and other tipping systems, like the West Antarctic Ice Sheet, whose melting could increase sea levels by more than three metres. Rahmstorf is involved in one group of bidders. Their theory is that, as the Amoc weakens, deep convection will slow — water will stop plunging thousands of metres deep in the north Atlantic, perhaps only plunging hundreds of metres. That would show the Amoc is doomed. There would be no way back on human timescales. But as the Amoc slowly wound down, society could begin a race to adapt. Whether the climate in northern Europe gets warmer or colder, it will get drier. That means investments in water storage should be worthwhile. So too insulation, which helps buildings both in hot and cold weather.

For now, unable to say with precision if or when the Amoc will collapse, scientists can merely flag the possibility and are unable to rule out a different scenario. Some environmentalists are wary of even talking about the Amoc collapse and other catastrophe risks. The public can already hear the alarm about climate change, argues Alex Evans, a former climate official in the UK government and the UN. “It makes them feel overwhelmed, so they tune it out.” Instead of pushing people into a “fight-or-flight state”, environmentalists need “a story of rebirth — of how we make it through”.

We implicitly assume that our society is smarter than the ones that have gone before — that it is building things that will last for longer. In London, St Paul’s Cathedral is now more than 300 years old. If the worst projections of future extreme events are correct, many things that we build now will not last half as long.


In his own field, Rahmstorf had hoped to be able to say, with precision, where the Amoc’s tipping point lay. Despite the recent advances, he concedes that question is unresolved. He is due to retire in 2026, before any tipping point project completes. “Data uncertainty is substantial. But uncertainty is not our friend. Uncertainty could mean the tipping point is passed early,” he says.

There is something even more important than more climate research: stopping emissions to reduce the risk of Amoc collapse. In a study awaiting peer review, Rahmstorf and other scientists have extended the IPCC’s models beyond 2100, and found that, in all scenarios where society fails to cut emissions sharply, the Amoc collapses. Even with dramatic emissions cuts, some models show an Amoc collapse.

“Would any great leaders in the late Middle Ages have taken decisions that, for example through sea level rise, wiped London and other great cities off the map? How would we look back at them?” he says, quietly, urgently. “My children are expected to live past the year 2100, and what about my grandchildren? They will really very strongly see the consequences of what we decide now.”

After the re-election of Donald Trump as US president, I asked him whether he can escape the implications of his work. “I try my best to not let the bad news about the escalating climate crisis take over my life, although this is increasingly hard,” he replied.

Back to the future. In a dramatically cooler Britain, when the winter storms come, higher sea levels mean that water surges in from the coast. The flooding is intense. The winds rip across roads, tearing down power lines. Those without battery storage are frequently cut off. Instead of the UK being a refuge for others escaping climate disruption, we might struggle to support even the population we have now.

In isolation, and in theory, many of the effects of climate change might seem manageable. The overarching problem is society. Humans can adapt to some disruption, but will they? Imagine a Britain where extreme weather bites deeper, food prices rise higher and young people choose to leave. If recent politics are any guide, that is a recipe for anger and nihilism, not co-operation and science. Radical politicians would mock the idea of global warming, arguing that Britain should burn more fossil fuels to stay warm and spray as much fertiliser as possible to eke out cropland.

A smart, resilient society could react in lots of ways to an Amoc collapse. If we were such a society, wouldn’t we already be doing a lot more to lessen the risk of it happening in the first place?

Barron's : ASML Is the Chip-Equipment Leader. Its Stock Is Poised to Bounce Back

ASML Is the Chip-Equipment Leader. Its Stock Is Poised to Bounce Back.

The U.S. stock market wouldn’t be riding so high without chip designer Nvidia, which is at the center of a flood of spending on artificial intelligence. Nvidia, in turn, is deeply dependent on Taiwan Semiconductor Manufacturing, which runs the world’s most sophisticated chip factories. And Taiwan Semi would be lost in cutting-edge chips without a Dutch company called ASML Holding, the leader in lithography, or using lasers and mirrors to print impossibly dense patterns on silicon wafers.

All three companies have done wonders for investors over the past decade: Nvidia shares have returned 29,000%; Taiwan Semi’s American depositary receipts, 1,100%; and ASML’s ADRs (which trade under the ticker ASML), 800%. But Nvidia and Taiwan Semi are trading close to their highs. ASML, after slashing its revenue guidance in October, is down by nearly a third from its peak last summer.

Is this an early warning for chips, and by extension, the U.S. stock market? Or is ASML losing its monopoly hold on high-end lithography? Bet neither—and that ASML will bounce back.

For background, start with Roy G. Biv, the old grade-school anagram for the colors of the rainbow, from red to violet. Colors are determined by wavelengths, and these are the ones that human eyes are tuned to see, from 700 nanometers down to 380, but there are others. For example, beyond red is the infrared used by remote controls, and beyond that are broadcast signals, because long waves travel far. Old-fashioned television, and now cellphones, can use waves as long as meatball heroes, and AM radio waves can be the size of football fields.

In the other direction, past violet, are extremely small waves that are handy for passing through solids, like the ultraviolet used in tanning beds, and below 10 nm, the X-rays that can reveal broken bones. This is the neighborhood where ASML plays. Its current extreme ultraviolet, or EUV, machines can print 13-nm resolutions, which chip makers can turn into even smaller features to achieve their current 7-nm, 5-nm, and 3-nm “nodes,” or generations. A nanometer is roughly how long a fingernail grows in a second; a human hair is 80,000 to 100,000 nanometers wide.

Transistor density tends to double every two years or so with a minimal increase in cost, making computers ever more powerful—a trend known as Moore’s law, and kept alive today by ASML. Its room-size machines are the most complex thing humanity has ever created, says Didier Scemama, who has studied ASML for decades and covers it for BofA Securities. For example, they fire lasers at molten tin droplets falling at a rate of 40,000 to 50,000 a second—two hits per droplet, without a miss. A stray particle could ruin a wafer, or take down the machine.

That technology took decades to develop. The first EUV test chips were made at SUNY Albany in 2008. The first commercial product to use EUV-enabled chips was Samsung Electronics’ family of Galaxy Note 10 smartphones in 2019. China, which is banned from buying ASML’s most sophisticated machines, would surely like to make its own. “I think the odds of them being very successful in EUV over the course of the next 10, 15, 20 years are fairly low,” says Scemama. Beyond complexity, there are ASML’s supply deals with Germany’s Carl Zeiss, which makes the world’s flattest mirrors, and Trumpf, which makes the world’s most powerful pulsed industrial lasers.

ASML’s current top machines are estimated to cost more than $220 million. The next generation, called high numerical aperture, or NA EUV, can print 8-nm resolutions, supporting nodes starting at 2 nm. Intel is an early recipient. Broader uptake could start in a year or two, at prices estimated at $380 million to $400 million per machine. Apple, which first brought 3-nm chips to market in its top 2023 iPhone, could move to 2-nm production around next Christmas. It currently leads the miniaturization push; Nvidia is content to lag a nanometer or two behind, while differentiating its chips with software and other add-ons.

Back to our original question. Why is ASML slumping? Three reasons. First, China has rushed to stockpile lower-end ASML equipment ahead of what might be tighter trade restrictions starting soon. The shift back to lower demand from China will temporarily sap growth. Second, Intel made a bold push to expand in chip manufacturing, with little financial success so far. Intel and Samsung have delayed equipment orders for their foundries. Third, despite strong growth in AI, there is a slump in consumer devices and their chips. Two-thirds of the companies in the Philadelphia Semiconductor index have trailed behind the S&P 500 over the past year.

A return to growth for ASML seems likely. Timing will depend on demand for phones, personal computers, cars, and gaming machines—as well as whether Intel and Samsung are able to lure Taiwan Semi customers to their foundries. One bear case is that lithography intensity is rising more slowly than in the past. Taiwan Semi’s 5-nm node uses 10 to 12 EUV layers, and its 3-nm node, about 20. But with its 2-nm node, this is believed to rise to only 22 layers. On the other hand, older nodes will remain relevant for many years; the shift to high NA EUV is coming; and computer memory is following the same rising EUV demand path as processors, adding to growth.

BofA’s Scemama reckons that earnings for ASML will grow at a compounded average of 16% a year over the next five years. Shares trade at 37 times this year’s slashed earnings estimate—a premium, but one that is close to a 10-year low relative to U.S. chip-equipment companies, J.P. Morgan points out. My colleague Andrew Bary recently named ASML one of his top 10 stock picks for 2025. And Scemama’s price target for the ADRs implies 26% upside.

Barron's : Japan Is the Silicon Valley of the Robot Revolution. The Stocks Are C

Japan Is the Silicon Valley of the Robot Revolution. The Stocks Are Cheap.

Jensen Huang says robots are the next big thing, or one of them anyway. That’s good news for Japan, potentially.

“The ChatGPT moment for robotics is coming,” Nvidia’s chief executive declared while keynoting the monster CES tech fair on Jan. 6 in Las Vegas. His company will ramp up an array of software tools enabling the jump from today’s mechanical assembly-line arms to tomorrow’s intelligent “humanoids,” he promised.

Japan is the Silicon Valley of industrial robotics. Companies like Fanuc, Yaskawa Electric, and Nachi-Fujikoshi churn out nearly half of the global supply of robots, according to the International Federation of Robotics. U.S. producers barely figure, as yet.

Japanese robotics stocks have been laggards, too, because they’ve been linked to so-so demand from Chinese manufacturers, not global hype about artificial intelligence. Fanuc’s shares gained 3% over the past year.

The road to rerating is hardly smooth. Industrial robotics is a mature business, slated for 5% growth this year, predicts Susanne Bieller, general secretary at the IFR. Japan’s stalwarts aren’t investing much in a humanoid explosion they view as speculative.

“There’s a lot of money going into humanoid robots in the U.S. and China, not so much in Japan,” she says.

One particular American, Elon Musk, promises that Tesla’s anthropomorphic Optimus robot will “fundamentally transform civilization,” whenever it is ready.

Significant penetration for what Huang calls “physical AI” will wait till the 2030s, thinks Tejas Dessai, director of thematic research at Global X ETFs. Companies like Nvidia and the software giants need to build the necessary data centers first.

“We could see a $30,000 to $40,000 humanoid in every household,” he says. “But we have to temper expectations on the timeline.”

Intriguing pilot projects are popping up, particularly in Japan, where labor shortages driven by a shrinking population meet enthusiasm for advanced gadgets. Patrons at Tokyo’s DAWN Avatar Cafe are served by robots remotely controlled by disabled humans spread across the country.

“We aim to achieve a new form of social participation through technology,” operator OryLab says. Visitors to the capital can stay at the Henn na Hotel, where all customer-facing staff are robots.

Less quixotically, Bieller sees a potential approaching boom in “mobile manipulators,” traditional robotic arms mounted on wheels so they can, for instance, stock and unload goods in warehouses. Omron, a firm probably better known for medical devices, is leading the Japanese charge here. Two prominent competitors, Robotnik Automation and PAL Robotics, are based in Spain.

Huang’s ChatGPT analogy is imprecise, Bieller says. OpenAI was able to “train” its text-spewing wizard on an infinite supply of free words from the internet. Robot performance data is jealously guarded by auto makers and other end users.

Nvidia is looking to compensate with virtual replicas of robots’ environments, or “digital twins of factories and other environments that accurately duplicate the physical characteristics,” as the company’s press release puts it. That could also take a while, even for the world’s supreme microchip designer.

But the ChatGPT precedent, and subsequent feeding frenzy on AI-related stocks, teaches us that new technologies can seem remote until they are suddenly everywhere all at once—at least for investors.

If and when robotics’ moment comes, it’s hard to imagine that the traditional Japanese leaders in the field won’t get a lift.

“Now is the time to become aware of the products being developed and research the firms,” says Neil Newman, head of strategy at Astris Advisory in Tokyo.

FT : The relationship recession is going global

The relationship recession is going global
A rise in the number of single people is becoming a key driver of falling birth rates

There’s a reason birth rates are an increasingly prominent feature in discourse and policymaking today. Population ageing and decline is one of the most powerful forces in the world, shaping everything from economics to politics and the environment.

But a weakness to the debate — perhaps even the term “birth rates” itself — is that it implies the goal is the same today as it was in the past: finding ways to encourage couples to have more children. A closer look at the data suggests a whole new challenge.

Take the US as an example. Between 1960 and 1980, the average number of children born to a woman halved from almost four to two, even as the share of women in married couples edged only modestly lower. There were still plenty of couples in happy, stable relationships. They were just electing to have smaller families.


But in recent years most of the fall is coming not from the decisions made by couples, but from a marked fall in the number of couples. Had US rates of marriage and cohabitation remained constant over the past decade, America’s total fertility rate would be higher today than it was then.

The central demographic story of modern times is not just declining rates of childbearing but rising rates of singledom: a much more fundamental shift in the nature of modern societies.

Relationships are not just becoming less common, but increasingly fragile. In egalitarian Finland, it is now more common for couples who move in together to split up than to have a child, a sharp reversal of the historical norm.

When pictured as a rise in happily childless Dinks (dual income, no kids couples) with plenty of disposable income, the social trends accompanying falling birth rates seem benign.


But the rise of singledom and relationship dissolution is a less rosy story, especially considering the drop in relationship formation is steepest among the poorest. Of course, many people are happily single. The freedom to choose how to spend one’s life and who with (or without) is to be celebrated. But the wider data on loneliness and dating frustrations suggests not all is well.

The trend is global. From the US, Finland and South Korea to Turkey, Tunisia and Thailand, falling birth rates are increasingly downstream of a relationship recession among young adults. Baby bonuses put the cart before the horse when a growing share of people are without a partner. Even in parts of Sub-Saharan Africa, similar trends may be under way.


Why an almost worldwide decline, and why now? The fact that this is happening almost everywhere all at once points more to broad changes acting across borders than country-specific factors.

The proliferation of smartphones and social media has been one such exogenous shock. Geographical differences in the rise of singledom broadly track mobile internet usage, particularly among women, whose calculus in weighing up potential partners is changing. This is consistent with research showing social media facilitates the spread of liberal values (notably only among women) and boosts female empowerment.


The fall in coupling is deepest in extremely-online Europe, east Asia and Latin America, followed by the Middle East and then Africa. Singledom remains rare in south Asia, where women’s web access is more limited.

This is not to overstate the role of social media. Other cultural differences between countries and regions mediate both the spread of liberal ideals and people’s ability to act on them. Caste and honour systems encourage high rates of marriage, irrespective of media access, and female education, income and employment differ markedly between regions.


But while the specific mechanisms are up for debate, the proliferation of singledom and its role in cratering birth rates shows that while financial incentives and other policy tweaks can nudge birth rates higher, they are labouring against much stronger sociocultural forces.

Policies aimed at facilitating relationship formation might be more effective than those aimed at helping couples have babies.

A world of rising singledom is not necessarily any better or worse than one filled with couples and families, but it is fundamentally different to what has come before, with major social, economic and political implications. We are faced with a conundrum: is this what people really want? If not, what needs to change?

>>> US Close Dow -1.63% S&P -1.64% Nasdaq -1.63% Russell -2.12%

Closing Stock Market Summary
Major equity indices registered significant declines today, driven by a surge in market rates following the release of this morning's labor market data. The S&P 500 fell 1.5% and the Nasdaq Composite declined by 1.6%. The Dow Jones Industrial Average fell nearly 700 points, or 1.6%.

The Employment Situation report for December, released at 8:30 ET, showed nonfarm payrolls exceeding expectations with an increase of 256,000, while the unemployment rate edged lower to 4.1% from 4.2%, and the year-over-year growth in average hourly earnings was a solid 3.9%. The market's negative sentiment following the report was largely attributed to concerns over persistent inflationary pressures, fueled by a robust labor market and earnings growth, alongside worries that the Federal Reserve may maintain higher interest rates for an extended period.

The 10-year Treasury yield, which was at 4.70% prior to the report, jumped to 4.78% in its aftermath before settling at 4.78%, up nine basis points from yesterday. The 2-year yield, which is most sensitive to changes in the fed funds rate, rose from 4.29% just before the report to 4.40%, an increase of 13 basis points from yesterday.

The broader market experienced widespread losses, with ten of the 11 S&P 500 sectors in the red. Market breadth reflects this downside skew, with decliners outpacing advancers by a 4-to-1 margin on the NYSE and by a 3-to-1 margin on the Nasdaq.

Some individual stocks outperformed, driven by specific catalysts. Delta Air Lines (DAL 66.95, +5.53, +9.0%) gained 9.7% following stronger-than-expected earnings results, while Walgreens Boots Alliance (WBA 11.76, +2.54, +27.6%) surged 27.6% after surpassing earnings estimates. Taiwan Semiconductor Manufacturing Company (TSM 208.37, +1.25, +0.6%) reported record revenues for the fourth quarter, leading to a 0.6% rise in its stock price.

Energy stocks were another bright spot, leading the S&P 500 energy sector to close 0.3% higher, driven by commodity prices. WTI crude oil futures rose 3.6% to $76.63/bbl and natural gas futures jumped 4.6% to $3.40/mmbtu.
  • S&P Midcap 400: -0.7% YTD
  • Nasdaq Composite: -0.8% YTD
  • S&P 500: -0.9% YTD
  • Russell 2000: -1.8% YTD
  • Dow Jones Industrial Average: -1.4% YTD

Reviewing today's economic data:
  • December Nonfarm Payrolls 256K (Briefing.com consensus 154K); Prior was revised to 212K from 227K,December Nonfarm Private Payrolls 223K ( consensus 140K); Prior was revised to 182K from 194K,
  • December Avg. Hourly Earnings 0.3% (Briefing.com consensus 0.3%); Prior 0.4%, December Unemployment Rate 4.1% (Briefing.com consensus 4.2%); Prior 4.2%, December Average Workweek 34.3 (consensus 34.3); Prior 34.3
    • The key takeaway from the report for the market is that it was perhaps too good, which makes it think one of two things, if not both: the Fed may have made a mistake cutting rates as aggressively as it did at the end of 2024, thereby fueling the prospect of sticky inflation because the labor market is still strong, and there isn't going to be another rate cut for an extended period.
  • January Univ. of Michigan Consumer Sentiment - Prelim 73.2 (consensus 73.5); Prior 74.0
    • The key takeaway from the report is that consumers' worries about the future path of inflation increased, which is not what the Fed wants to hear, especially as plans to implement new tariffs loom on the near horizon.

Looking ahead, Monday's calendar features the December Treasury Budget at 2:00 p.m. ET.

>>> Weekly Market Update

US markets opened the week on solid footing helped in large part by reassuring news surrounding President-elect Donald Trump. His agenda received a boost in the wake of last week’s House speaker outcome, but also reports circulated he was likely to consider more targeted tariffs than what was proposed during his campaign. Trump unsurprisingly pushed back on that notion, wanting to keep his bargaining leverage intact before he takes office. Nevertheless, trading remained turbulent amid a continued backup in bond yields, globally. Solid EU economic readings were followed by hotter-than-expected ISM services and JOLTS jobs data in the US which then culminated in significantly hotter than expected December employment report on Friday. Separately, worries about a full blown UK crisis flared as the 10-year GILT yield hit its highest level since the height of the global financial crisis and the Sterling tumbled.

Headwinds to US stocks were formidable by Friday after the December employment report was hot on nearly every metric, including both the Establishment and Household surveys. Though subdued wage numbers may provide Fed Chair Powell and Co. some solace, higher rates, a stronger dollar and equity weakness ensued. The US 30-year yield briefly broke above 5% and the 10-year tested 4.75%. Adding to the consternation, the January University of Michigan inflation expectations also jumped significantly above 3%, and WTI crude prices rose nearly 5% on the anticipation of additional US sanctions on Russian crude. The VIX volatility index climbed back towards 20, while the US dollar index continued to print new highs going back more than two years. For the week, the S&P and DJIA each fell 1.9%, while the Nasdaq was off 2.3%.

Corporate news was centered on Nvidia’s CES presentations early in the week, and M&A stories emerged as a major theme as the days wore on. Nvidia CEO Jensen Huang pontificated on a wide variety of technology issues, from AI to robotics to quantum computing. As the ultimate AI hardware guru, he reiterated that the shift in computing is just beginning and suggested that intelligent humanoid robots could one day far outnumber humans on earth. His good vibes about AI were enough to turn Nvidia shares higher on Monday, though ultimately he and his CFO did not provide much in the way of new financial guidance and the stock ended down for the week. In a light week for earnings, Delta stood out as the latest airliner to report good news, proclaiming that 2025 could become its best financial year in its century of operations. Not everything was rosy on the earnings front as Constellation Brands took its biggest one day dive in a decade after missing expectations and cutting outlook on uncertainty about the timing of consumers returning to ‘normalized’ spending. In M&A news, Inari medical became the latest M&A target in the medtech field, agreeing to be acquired by Stryker for $4.9B. Constellation Energy announced it would acquire Calpine, the largest U.S. producer of energy from low-emission natural gas generation, in a $29B deal that was applauded by the market. And Fubo announced a deal to be merged into Disney’s Hulu business.


MON 1-06
(CA) Canada PM Trudeau: Confirms to step down as soon as the Liberal Party chooses a replacement; Also confirms work at Parliament to be suspended until March 24th
(DE) GERMANY DEC PRELIMINARY CPI M/M: 0.4% V 0.3%E; Y/Y: 2.6% V 2.4%E (highest annual pace since Jan 2024)
(EU) EURO ZONE JAN SENTIX INVESTOR CONFIDENCE: -17.7 V -17.9E
(IT) ITALY DEC SERVICES PMI: 50.7 V 50.0E (moves back into expansion); Cost and charge inflation pick up
(UK) Wind turbines in the UK have overtaken gas plants for first time as number one source of electricity - financial press
(US) NOV FACTORY ORDERS: -0.4% V -0.4%E
(US) Truflation proxy of US aggregated Inflation Index at 2.9% v 3.1% w/w, which was near highs of autumn 2023; Cleveland Fed’s Inflation Nowcast forecasting Dec US CPI Y/Y (to be out on Jan 15th) to accelerate again to 2.9% from 2.7%; Then, forecasting Jan US CPI Y/Y (to be out next month) to stay roughly unchanged from Dec forecast at 2.9%
(US) PRES-ELECT TRUMP'S AIDES EXPLORE "UNIVERSAL" TARIFF PLANS FOR EVERY COUNTRY BUT WHICH WOULD ONLY COVER CRITICAL IMPORTS - WAPO [**Note: As a candidate, Trump called for “universal” tariffs of as high as 10-20% on everything imported into the US]
(US) DEC FINAL S&P SERVICES PMI: 56.8 V 58.5E (confirms 23rd month of expansion)
(US) Fed's Barr (voter) plans to step down as vice chair for supervision on Feb 28th; Will continue to serve as governor
(US) State of Louisiana reports first US bird flu (H5) related death
(US) On Friday, US House passed new rules package which includes provision that would require nine members of the Republican conference to trigger a 'motion to vacate' the Speakership (update)
(US) Pres-elect Trump: Washington Post story that I'll pare back my tariff policy is wrong - Truth Social post
700.HK (CN) US Pentagon has added Chinese firms Tencent, CATL, Autel Robotics, Changxin Memory Tech, Quectel Wireless to list of companies alleged to be helping the Chinese military
ASTS Announces agreement for long-term access to up to 45 MHz of lower mid-band spectrum in the United States for direct-to-device satellite applications
CMC Reports Q1 $0.78 v $0.78e, Rev $1.91B v $1.89Be; Very encouraged by its recent conversations with customers and the optimism they have voiced about the coming quarters, measures of both big and small business confidence have improved significantly over the last two months
FUBO Confirms to Combine with Disney’s Hulu + Live TV Virtual MVPD Businesses; In connection therewith, at signing of the Transaction, Disney, FOX and Warner Bros. Discovery will make an aggregate cash payment to Fubo of $220M
FUBO Reportedly Disney nears deal to merge Hulu+ Live into Fubo; Disney will own majority stake in new venture with Fubo; Fubo to drop litigation related to Venu Sports as part of deal - press (update)
NARI Stryker announces definitive agreement to acquire Inari for $80/shr in cash, valuing it at $4.9B
NVDA Launches Cosmos World Foundation Model Platform to Accelerate Physical AI Development
ULTA Appoints Kecia Steelman President and COO as CEO, effective immediately; Raises Q4 outlook due to stronger than expected holiday season; Sees Q4 SSS increase modestly and Op margin will be above the high-end of the company’s previous expected range

TUES 1-07
(CH) SWISS DEC CPI M/M: -0.1% V -0.1%E; Y/Y: 0.6% V 0.6%E
(CN) CHINA DEC FOREIGN RESERVES: $3.202T V $3.273TE
(EU) EURO ZONE DEC ADVANCE CPI ESTIMATE Y/Y: 2.4% V 2.4%E (highest since July 2024); CPI CORE Y/Y: 2.7% V 2.7%E (Core CPI does not decelerate for 4th straight month)
(EU) Euro Zone Nov ECB Consumer Expectation Survey: 1-year ahead CPI expectations: 2.6% v 2.5% prior
(IT) Italy Dec Preliminary CPI M/M: 0.1% v 0.3%e; Y/Y: 1.3% v 1.5%e
(US) ILA union and port owners held secret meeting on automation as new strike looms; A document produced from the meeting indicates ports willing to pair any new technology with new union jobs, but it could also introduce new risks to a deal - CNBC [**Note: earlier, reports that leaders from a US dockworkers’ union and the group that represents their employers are set to resume contract talks on Tue, Jan 7th ahead of Jan 15th's deadline]
(US) NOV JOLTS JOB OPENINGS: 8.098M V 7.740ME
(US) US Pres-elect Trump said to plan announcement of $20B investment in US data centers – CNBC
(US) Redfin: More than one-third (34%) of U.S. homeowners say they’ll never sell their home, and another 27% say they wouldn’t consider selling for at least 10 years
(US) TREASURY'S $39B 10-YEAR NOTE REOPENING DRAWS 4.680% V 4.235% PRIOR; BID-TO-COVER RATIO: 2.53 V 2.70 PRIOR AND 2.56 OVER LAST 8 REOPENINGS
(US) DOJ sues six large US landlords over algorithmic pricing schemes
(US) JPMorganChase’s 2025 Business Leaders Outlook: Confidence in the national economy has jumped 12ppts y/y to 55% among small business owners, and more than doubled from 31% to 65% among midsize business leaders; Inflation remains a top concern as most small business owners are seeing an increase in business expenses, and more than three-quarters of midsize business leaders feel costs are rising
(US) US Pres Elect Trump: Confirms UAE DAMAC's Edgnex data centers upcoming investment of at least $20B
(US) US Pres Elect Trump: Confirms UAE DAMAC's Edgnex data centers upcoming investment of at least $20B
(US) DEC ISM SERVICES INDEX: 54.1 V 53.5E; Prices Paid: 64.4 v 57.5e (the first time >60 since Jan 2024 and ~2-yrs
(US) Atlanta Fed GDPNow: Raises Q4 GDP forecast from 2.4% to 2.7%
005930.KR Reports prelim Q4 (KRW) Op 6.50T v 6.93Te (2.80T y/y), Rev 75.0T v 77.2Te (67.0T y/y); Earnings in its core semiconductor division were hit by cooling demand for computers and handsets and the greater investments needed to expand capacity for advanced chip manufacturing
066570.KR Reports prelim Q4 (KRW) Op 146.1B v 368.7Be (v 312.5B y/y), Rev 22.8T v 22.7Te (v 23.2T y/y)
BWXT Enters Agreement to Acquire Kinectrics, a Leading Service Provider to the Global Nuclear Market for ~$525M including assumption of Kinectrics’ net pension and debt liabilities
NVDA TTN Summary of 11:00ET JP Morgan Fireside Chat: Expects strong market reception and product cycle for Blackwell GeForce GPUs with 2x performance over last generation; shipping starts in January, including DLSS 4 technology; Blackwell shipments are on track, as expected
NVDA Tier1 analysts: NVDA has fine-tuned the stock Llama models for easier enterprise AI adoption, specifically for agentic AI, where custom AI agents help solve complex problems and automate repetitive tasks; NVDA now offers tools where its AI agents are capable of both language and video/image perception abilities to be applied to various real-life applications
NVDA TTN Summary of 21:30ET NVIDIA CES 2025 Keynote: Announces new RTX Blackwell family GPUs (RTX 50 series); Blackwell supercomputers are in full production; Introduces compact AI supercomputer; Unveils NVIDIA Cosmos, pen-licensed world foundation model for physical AI; Announces NVIDIA Llama Nemotron suite of open models based on Meta's Llama 3.1, optimized for enterprise use and domain fine-tuning; models rank number one in chat, instruction, and retrieval leaderboards.
SANA Announces Positive Clinical Results from Type 1 Diabetes Study of Islet Cell Transplantation Without Immunosuppression; First-in-Human Study Provides Evidence that Sana’s Hypoimmune (HIP) Technology Enables Transplanted Islet Cells to Avoid Immune Rejection and Produce Insulin Without Immunosuppression
SSP E.W. Scripps, Gray Media, Nexstar Media Group and Sinclair launched new JV company EdgeBeam Wireless to provide robust wireless data services to a wide range of businesses and industries across the country (update)
SSP E.W. Scripps, Gray Media, Nexstar Media Group and Sinclair launched new JV company EdgeBeam Wireless to provide robust wireless data services to a wide range of businesses and industries across the country (update)

WEDS 1-08
(US) US dockworkers reach tentative pact for six year contract to avert strike at East Coast, Gulf Coast Ports
(US) Cleveland Fed’s Inflation Nowcast cuts Jan US CPI Y/Y (to be out next month) forecast from 2.9% to 2.8%, implying deceleration v its estimate for Dec US CPI Y/Y (to be out on Jan 15th) at 2.9%; Truflation proxy of US aggregated Inflation Index at 2.9% v 3.1% w/w, which was near highs of autumn 2023
(US) MORE PRESS REPORTS TRUMP AGAIN WEIGHS EMERGENCY DECLARATION FOR NEW TARIFF PROGRAM - CNN (as widely expected) [**Note: Declaring national emergency would allow Trump to impose tariffs with less procedural hurdles; Trump previously invoked International Emergency Economic Powers Act (IEEPA) in 2019 to threaten tariffs on Mexican goods, and courts have upheld similar actions, such as Nixon’s emergency tariffs in 1971]
(US) Dec Manheim wholesale used vehicle Index: 204.8 v 205.4 prior; -0.8% m/m; +0.4% y/y
(US) NOV FINAL WHOLESALE INVENTORIES M/M: -0.2% V -0.2%E
(US) DOE CRUDE: -1M V -1ME; GASOLINE: +6.3M V +0.5ME; DISTILLATE: +6.1M V +0.5ME
(US) FOMC DEC MINUTES: OFFICIALS SAW GRADUAL EASING OF LABOR MARKET, NO SIGNS OF RAPID DETERIORATION; SOME OFFICIALS SAW MERIT IN HOLDING RATES STEADY IN DECEMBER
(JP) JAPAN NOV LABOR CASH EARNINGS Y/Y: 3.0% V 2.7%E (highest since Aug, 2024)
(US) LA Fire Chief: Eaton fire continues to grow with zero containment; Fires are a widespread disaster
(US) Fed's Waller (voter for 2025): Inflation downtrend likely support more cuts; To support cuts in 2025 if outlook as expected
(US) WEEKLY EIA NATURAL GAS INVENTORIES: -40 BCF VS. -51 BCF TO -53 BCF INDICATED RANGE
(US) INITIAL JOBLESS CLAIMS: 201K V 215KE; CONTINUING CLAIMS: 1.867M V 1.860ME
(US) TREASURY $22B 30-YEAR BOND REOPENING DRAWS 4.913% V 4.535% PRIOR; BID TO COVER 2.52 V 2.39 PRIOR AND 2.41 OVER LAST 8 REOPENINGS (highest yield at auction since Aug 2007)
(CN) CHINA DEC CPI Y/Y: 0.1% V 0.1%E (weakest since Apr 2024)
(JP) JAPAN NOV LABOR CASH EARNINGS Y/Y: 3.0% V 2.7%E (highest since Aug, 2024)
NVDA *(US) Biden Admin plans additional curbs on exports of AI chips from Nvidia and AMD in final days of the Administration; 3-tier system of trade curbs on chips could be announced as soon as Fri, Jan 10th; The result would be an expansion of chip trade curbs to most of the world; Also the new rules to limit the export of closed AI model weights - press
ACI Reports Q3 $0.71 v $0.66e, Rev $18.8B v $18.8Be; Raises FY EPS and EBITDA, narrows rev; Notes the consumer remains cautious; Sees robust productivity agenda to provide fuel to invest in the business
CEG Said to be closing in on almost $30B deal for Calpine; May announce deal within weeks – press
HELE Reports Q3 $2.67 v $2.61e, Rev $530.7M v $530Me

THRS 1-09
(US) Fed's Schmid (voter; hawk): Strength of the economy allows the Fed to be patient; Rates may be very close to the longer run neutral rate
(US) Fed's Bowman (voter, hawk): Continue to prefer a cautious and gradual approach to adjusting rates; Inflation is elevated with upside risks, and progress has stalled
(US) Redfin: The median U.S. asking rent fell 0.3% yearover year in December to $1,594—the lowest level since March 2022; Notes asking rents may not have much further to fall this year given that apartment construction has begun to slow
(US) Elon Musk: DOGE budget-cutting effort would most likely Not find $2T in savings; $2T figure was a “best-case outcome” and there was only a “good shot” at cutting half that - interview broadcast on X
(UK) Treasury Min Jones: No need for emergency intervention; Financial markets continue to function in an orderly way; Only OBR forecast can predict impact of GILT moves on fiscal headroom
2007.HK Announces the key terms of its restructuring proposal; Reaches understanding with the co-ordination committee; If implemented, Restructuring Proposal will enable the Group to achieve significant deleveraging, with a targeted reduction of indebtedness up to $11.6B
TSLA CEO Musk: Targets to produce several thousand of humanoid robots Optimus in 2025; In 2026, assuming everything goes well, aim to produce 50-100K humanoid robots and then 10x the output in 2027 - press

FRI 1-10
(RU) US Treasury Dept confirms Russia sanctions; Publishes determination "Energy Sector of the Russian Federation Economy"
(UK) Rising GILT yields reportedly triggers pension cash calls in first big test since 2022 crisis – press
(US) Fed's Musalem (voter): Further rate reductions have to be gradual and more gradual than I thought in September; Since September, the picture changed; The economic data came in stronger and the inflation numbers printed higher than desired. So I changed my assessment of risks - WSJ
US) DEC CHANGE IN NONFARM PAYROLLS: +256K V +165KE (above all analysts' estimates)
(US) DEC UNEMPLOYMENT RATE: 4.1% V 4.2%E
(US) DEC AVERAGE HOURLY EARNINGS M/M: 0.3% V 0.3%E; Y/Y: 3.9% V 4.0%E
(US) USDA WORLD AGRICULTURAL SUPPLY DEMAND ESTIMATES (WASDE) CROP REPORT End 2024/2025 US Stocks (M bu): Soybeans: 380 v 454e; Corn: 1,540 v 1,678e; Wheat: 798 v 807e
(US) JAN PRELIMINARY UNIVERSITY OF MICHIGAN CONFIDENCE: 73.2 V 74.0E; 1-year inflation expectations 3.3% v 2.8%e; 5-10 year inflation expectations 3.3% v 3.0%e
(CA) CANADA DEC NET CHANGE IN EMPLOYMENT: +90.9K V +25.0KE; UNEMPLOYMENT RATE: 6.7% V 6.9%E
DIS Venu Sports will be discontinued; A joint state from ESPN, FOX and WBD said: "We determined that it was best to meet the evolving demands of sports fans by focusing on existing products and distribution channels." - press
NVDA Announces Blueprint for AI Retail Shopping Assistants
NVDA Tier1 analysts after attending investor dinner with NVDA CFO Colette Kress: Nvidia downplayed potential for custom ASICs' rapid share gains; Blackwell transition well-progressing, Hopper mix dependent on supplies. Mid-70%s GM likely once Blackwell begins full ramp
DAL Reports Q4 $1.85 v $1.76e, Rev $14.4B v $14.2Be; Guides Q1 strong; During Nov-Dec, saw four of the top ten revenue days in the company's history
DAL CEO: Delta Air Lines could see 2025 becoming the airline’s best financial year since its founding a century ago; Notes the growing number willing to shell out for premium seats - FT pre-earnings interview
STZ Reports Q3 $3.25 v $3.34e, Rev $2.46B v $2.54Be; Cuts outlook noting uncertainty on when consumers will revert to more normalized spending
SNX Reports Q4 $3.09 v $3.06e, Rev $15.8B v $15.3Be; Raises Quarterly dividend 10% to $0.44 from $0.40 (indicated yield 1.43%)
WBA Reports Q1 $0.51 v $0.37e, Rev $39.5B v $37.1Be
(US) BOFA INSTITUTE: DEC TOTAL CARD SPENDING +2.2% Y/Y V +0.6% IN NOV; Calendar shifts continue to confound; Notes the inexorable shift toward online spending; Unfavorable seasonal factor for nonstore retailers, which now account for nearly 1/3 of the control group, creates downside risks.
CEG Confirms to acquire the largest U.S. producer of energy from low-emission natural gas generation, Calpine in stock-cash deal based on EV of $29.1B; The agreement creates the nation’s largest clean energy provider; Sees immediate adj op EPS accretion of more than 20% in 2026 and at least $2 per share of EPS accretion in future years
MSFT To take legal action to protect the public from abusive AI-generated content - blog post
MVST Announces significant milestone in the development of its True All-Solid-State Battery (ASSB) technology; Microvast's technology completely eliminates liquid electrolytes, which allows a single cell to achieve dozens of volts or higher based on specific application needs; Advancing to the next phase, the pilot production study