Before the bell: Fake News?

Technology drives the markets In the West and Japan, it brings gains. In China, the markets face pressure.

According to The Washington Post, advisors to Donald Trump II are reportedly considering imposing import taxes only on a select number of products. Previously, Trump stated he would apply a 10% to 20% tax on all imports. Now, only products deemed to threaten the nation’s security or economic stability might face such tariffs. But Trump wouldn’t be Trump if he didn’t later dismiss The Washington Post’s reporting as “just another example of fake news.” In Germany, December’s inflation unexpectedly rose to 2.9%, surpassing economists’ 2.6% forecast. Will the ECB adjust its course? Or is that fake news too? The euro briefly soared, climbing about 1% to $1.04. The Euro Stoxx 50 jumped 2.4%, while the Bel20 gained 0.6%. In the US, the S&P 500 rose 0.6%, and the Nasdaq shot up 1.2%.

This morning in Asia, markets were mixed. Japan’s Topix rose 1.1%, but in Hong Kong, Xiaomi (-8%) and Tencent (-7.4%) dragged the Hang Seng Index down by 1.7%. The latter was labeled a “Chinese military company” by the US Department of Defense. Today, Europe will release December’s inflation figures, while the US will reveal the results of its Purchasing Managers’ Index survey and November’s trade balance.

Technoparty

After Foxconn published record figures, tech stocks celebrated worldwide. The Taiwanese company, the world’s largest producer of computer components, reported fourth-quarter revenues of $65 billion—a 15% year-over-year increase. In December alone, sales surged by 42%, driven by substantial investments in AI servers. Foxconn’s shares rose 1.9% on Taiwan’s stock exchange yesterday and gained another 3% today. Other tech stocks joined the rally. Belgium’s Melexis rose 6.1%, while Dutch chipmaker ASML soared 8.7%. TSMC and Nvidia also climbed, gaining 4.7% and 3.4%, respectively. The AI boom shows no signs of slowing down in the new year.

From $7.3 billion to $50 million

Just Eat Takeaway has finalized the sale of its US subsidiary, Grubhub. The Dutch food delivery company had been seeking a buyer for years but struggled to find one. Just Eat Takeaway acquired Grubhub in 2021 during a period of rapid sector growth driven by lockdowns, paying a hefty $7.3 billion for the loss-making company. Soon after, billions were written off the troubled asset. On November 13, Just Eat Takeaway announced it had finally found a buyer. US competitor Wonder will pay only $50 million for a business once valued at $7.3 billion. Despite the steep discount, shareholders applauded, as Just Eat Takeaway is now free of a division unlikely to become profitable anytime soon.

Did you know…

Just Eat Takeaway (JET) funded its Grubhub acquisition entirely with shares? The company created 62,798,005 new shares, giving Grubhub’s former shareholders a 30% stake in the Dutch company. Since then, JET’s stock price has plummeted from a high of approximately €110 to just €13.31 as of yesterday.