😭 Elon Musk gets poor

Together with Danelfin

Good morning investors! Some of the biggest companies announced earnings yesterday with major surprises and shocks.

Today we cover:

• A look at the international markets. 🌎

• Elon Musk is in trouble. 😔 

• Earnings everywhere. 🧢 

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📊 Economy and News 

Australia hits a new high as China falls to a 5-year low

Mainland Chinese stocks fell to a five-year low while Australian stocks smashed all-time records on Wednesday.

China’s CSI 300 slid to a five-year-low, sinking 0.91% after manufacturing activity shrank for the fourth straight month in January. Hong Kong’s Hang Seng index dropped 1.78%. This seems to be their sixth straight losing month.

Other Asia-Pacific markets were mixed. Japan’s Nikkei 225 closed 0.6% higher, while the broad based Topix also ended nearly 1% higher.

South Korea’s Kospi was down 0.07%, while the small cap Kosdaq saw a bigger loss of 2.4%.

On the other hand, inflation in Australia is coming down. It came in at 4.2%, falling from 5.2% in the third quarter. This news sent the stock market soaring.

But, all is not lost for China. It is now very close to beating Japan to be the world’s number 1 car exporter.

Global hits:

• Saudi Arabia’s fourth-quarter real GDP fell 3.7% year-on-year, mainly due to oil cuts.

• New York sues Citibank for alleged failure to reimburse fraud victims.

• Europe’s economic pain drags on with zero growth at the end of last year.

📈 Stocks

S&P 500 4,924.97 (-0.060%)
DJIA 38,467.31 (+0.35%)
NASDAQ 17,476.71 (-0.68%)
BRENT CRUDE 81.93 (-1.17%)
* Prices as of Jan 31st, 12:20 AM UTC

Big hits and huge misses

A number of big companies announced earnings yesterday, here’s a summary:

• Microsoft delivered another blowout earnings report Tuesday, tallying its best-ever quarterly revenue for its fifth quarter in a row, mainly thanks to AI. Yet, the stock turned red after the bell.

• Google reported exciting numbers but the shares slid due to declining ad revenue. It reported $86.3 billion in quarterly sales, up 13% from a year earlier, and above analysts’ estimate of $85.2 billion. However, the stock was in red after the bell.

• Samsung reported a 34% fall in operating profit year-on-year in the fourth quarter, as well as a 73.4% plunge in net profit in the same period. However, the company believes that AI phones will help it bounce back.

• Starbucks disappointed after a miss mainly due to the boycott and global conflict. The company has slashed guidance and is planning to come up with new items to increase traffic, especially in the US.

• Novo Nordisk, Europe’s largest company by market capitalization, on Wednesday reported better-than-expected 2023 earnings as Wegovy, Ozempic demand soars. It is expecting a great 2024.

• GM easily beat expectations and rose above 7% yesterday. Revenue for the year of $171.8 billion, up from the $156.7 billion the Detroit automaker collected in 2022. According to the company, the strike cost over 1.1 billion; however, GM is expecting record profits in 2024.

• Novartis missed Q4 net income expectations, and extended its mid-term guidance, saying it expected sales to grow 5% per year until 2028, when adjusting for currency swings.

Today, Boeing is set to report fourth-quarter results in the shadow of the 737 Max 9 crisis.

Wall Street analysts expect an adjusted loss per share of 78 cents and revenue of $21.1 billion. The stock is down 20% YTD and a bad report could dent it further.

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🔐 Crypto

Bitcoin $42,378 (-1.13%)
Ethereum $2,282 (-2.58%)
Total market cap $1.64 (-2.2%)
* Prices as of Jan 3rd, 12:20 AM UTC

SEC proposes dropping Debt Box lawsuit amid threat of court sanctions

The United States Securities and Exchange Commission (SEC) has requested the dismissal of its lawsuit against crypto company Debt Box following a federal court’s demand for justification against potential penalties for alleged dishonesty.

History: The case started when the SEC accused Debt Box of orchestrating a $49 million fraudulent crypto scheme, functioning as a provider of software mining licenses.

The SEC made a major move in August after it successfully obtained a restraining order to freeze the company’s assets, citing concerns that the firm might flee to the UAE after transferring $720,000 overseas.

The twist: The case’s trajectory changed when Judge Robert Shelby reassessed his initial order and found misrepresentations on the SEC’s part.

Evidence revealed that the alleged $720,000 transfer was actually made within the US.

This made the judge to issue a “show cause order” to the SEC, forcing the SEC to admit its mistake.

In order to save face, the SEC has now requested to dismiss the case without prejudice, which would allow for the possibility of reopening the case in the future.

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Nothing in this newsletter is financial advice. Always do your own research and think for yourself.

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