Trump praises Q3 GDP, criticizes market; gold surpasses $4500; US stocks trading.

Summary of Recent Financial Developments

Fed Chair Candidate Hassett Comments on Interest Rates

The U.S. economy saw a significant growth of 4.3% in Q3, surpassing the Dow Jones estimate of 3.2%. Hassett attributes this growth partly to President Trump's tariff policies, which reduced the trade deficit. He noted that the AI boom is driving economic growth while exerting downward pressure on inflation.

Hassett stated, "If we maintain a 4% GDP growth into the new year, monthly job growth will return to the range of 100,000 to 150,000." He emphasized that the U.S. is lagging behind other central banks in terms of interest rate cuts.

Treasury Secretary's Inflation Target Discussion

Treasury Secretary Bessent supports revisiting the Fed's 2% inflation target once inflation stabilizes. He suggested a potential range of 1.5%-2.5% or 1%-3% for discussion. Bessent acknowledged public concerns over living costs, attributing them to high prices during the Biden administration.

Trump's Critique of Market Reactions

President Trump praised the GDP growth but criticized the market's unusual response to good news, which now often leads to stagnant or declining stock prices due to fears of interest rate hikes. He expressed a desire for the new Fed chair to lower rates when the market is strong.

Consumer Confidence Decline

U.S. consumer confidence has dropped for five consecutive months, matching the longest streak since 2008. This decline reflects concerns over prices and employment, leading to cautious spending. In contrast, the Richmond Fed manufacturing index has improved, indicating growing business confidence.

U.S. Tariffs on Chinese Semiconductors

The U.S. plans to impose tariffs on Chinese semiconductor products by mid-2027, following a year-long investigation into unfair trade practices. The initial tariff rate will be set at 0%, with adjustments to be announced later.

Precious Metals Surge

Gold and silver prices have reached historic highs, driven by geopolitical tensions and expectations of further Fed rate cuts. Gold surpassed $4,500 per ounce, marking a significant increase.

U.S. Stock Market Performance

On December 23, U.S. stocks continued to rise, with the S&P 500 closing at a record high. Nvidia led the gains among major tech stocks, rising 3%, while Tesla saw a decline in European sales.

Notable Corporate Developments

• Nvidia plans to deliver H200 AI chips to Chinese customers before the Lunar New Year, although uncertainties remain regarding order approvals.

• Google is set to launch new AI smart glasses in 2026, aiming to compete with Meta.

• Broadcom's CEO sold shares worth over $42 million, part of a larger trend of insider selling.

• ServiceNow announced an acquisition of Armis for approximately $7.75 billion to enhance its cybersecurity capabilities.

• JD.com reported a theft incident at its Paris warehouse, with significant losses, but operations have since resumed.

• Sunac China completed a comprehensive overseas debt restructuring, relieving $9.6 billion in debt.

• SMIC has raised prices on some production capacities by about 10%, influenced by rising raw material costs.

Market Movements in Hong Kong

Recent trading saw significant net purchases of Alibaba and Meituan, while China Mobile and Tencent experienced notable sell-offs.

Conclusion

The financial landscape is marked by significant economic growth, evolving monetary policy discussions, and notable corporate developments, all of which are shaping market dynamics as we approach the new year.