Rise and shine everyone.

Nvidia's earnings didn’t really disappoint. We got a double beat and raise but, the market didn’t seem thrilled because they were “secretly” expecting more. They did discuss a decline in margins because of the Blackwell launch, which is a more cost-intensive endeavor. But, they also emphasized that demand outweighs supply, and that accounts for the increase in revenue once shipments start ramping next year.

We also got results for Snowflake and Palo Alto Networks. While neither disappointed, Snowflake saw its price jump after hours, while PANW took a hit. PANW also announced a 2-for-1 split for their stock.

In international news, the Indian Tycoon Adani has been indicted for bribery in the US. Adani Enterprises’ stock plummeted by 23% after the market opened, erasing $23 billion in market value, while several of its subsidiary companies also saw steep declines of up to 20%.

There seems to be some confusion about Russia's use of missiles. This morning, Ukraine’s Air Force reported that Russia fired an RS-26 missile, marking the first use of an intercontinental ballistic missile (ICBM) in the conflict. While Russia’s action is seen as a response to recent US and UK deployment of long-range missiles, Ukraine suggested the RS-26 was armed with a conventional warhead rather than a nuclear payload. However, ABC News later contradicted these claims, stating the missile was a ballistic missile, not an ICBM.

Regardless of what missiles were used, there are definitely signs of increased escalation between Ukraine and Russia.

US Equity Futures are slightly higher in the pre-market, although the Nasdaq remains flat after Nvidia and Palo Alto’s pullback. Bitcoin has crossed 98k. Crude, gold and natural gas are all higher this morning.

China and Japan

1. China’s 2025 GDP Growth Target:

Four Chinese government advisers have recommended maintaining a 2025 GDP growth target of around 5%, aligning with the 2024 target. Two other advisers suggested more conservative targets of 4.0% or 4.5-5.0%, reflecting varying outlooks on economic conditions.

2. Japan’s Budget Agreement:

Japan’s political parties (DPP, LDP, and Komeito) resolved a budget impasse, agreeing to pass an additional budget by the end of 2024. The DPP secured a concession to raise the income tax-free threshold within the fiscal plan. Reports indicate an economic stimulus package of approximately ¥21.9 trillion may be in the works, though it’s unclear if this includes the previously mentioned ¥13.5 trillion extra budget.

3. Bond Yields and Economic Signals:

• Japanese 5-year JGB yields rose 1.5 basis points, reaching their highest level since August 2009.

• 10-year JGB yields exceeded 1.08%, reflecting market adjustments to fiscal developments.

4. China’s October Machine Tool Orders:

Orders for Japanese machine tools from China surged by 48.7% year-over-year in October. This spike may indicate stockpiling ahead of potential trade restrictions or tariffs under a possible Trump presidency.

Calendars

(news taken from Reuters, FT, Bloomberg; Calendar from Trading Economics)