Before the bell: Trump threatens 100% tariff on Canada

Both precious metals markets and equity markets continue to break new records. Later today, Boeing, LVMH, UnitedHealth and Visa will report their quarterly results.

Asian stocks break records

With a gain of 0.5%, the S&P 500 narrowly missed setting a new record on Monday. CoreWeave (+5.7%) benefited from a 2 billion dollar investment by Nvidia, which should help the group accelerate the construction of data centres. After last week’s sharp 17% drop, chipmaker Intel lost another 5.7% on Monday. The decline follows disappointing production figures and ongoing capacity constraints at the company.

The trading session was also dominated by precious metals. Both gold and silver prices surged to new record levels, but the euphoria faded toward the end of the session as silver prices dropped sharply. Many mining stocks gave back earlier gains. Sportswear producer Puma, meanwhile, benefited from interest from China’s Anta Sports. Anta Sports is acquiring a 29% stake in Puma at a price 62% above Monday’s closing price. Michael Burry also disclosed a stake in videogame retailer GameStop, pushing the stock up 4.4%. According to Burry, this is a long-term investment.

In Asia this morning, several indices are breaking new records. In South Korea, the Kospi index is up 2.1%, with technology stocks such as Samsung Electronics among the strongest performers, gaining 3.3%. President Trump’s threat to raise tariffs on South Korea to 25% had little impact on the index. In Belgium, IBA stands out again this morning after securing a new contract in Taiwan for its Proteus ONE system. IBA had previously sold three of these systems in the United States. Healthcare real estate operator Care Property Invest has also signed a new long-term lease with Hestia for two care facilities. Today, Boeing, General Motors, LVMH, UnitedHealth, Texas Instruments, Visa and UPS will publish their quarterly results.

Don’t let tax considerations drive your decisions

Belgians do not like paying taxes. That is one of the reasons why so much savings remain parked in regulated savings accounts earning barely 1% interest. The return may be low, but at least there is no tax to pay on it, many Belgians think. We have stressed repeatedly that investment decisions should not be driven by tax considerations or emotions, as that tends to hurt long-term returns.

Soon, we may also need to warn investors not to take unnecessary additional risks for tax reasons. Research by Trends suggests that investors in private equity funds may fall outside the scope of the capital gains tax. This exemption would apply to private privaks, the legal structure under which most private equity funds operate. By contrast, if you invest in listed holding companies such as Sofina, you would pay a 10% capital gains tax upon sale if the current draft legislation is approved. However, do not be tempted to overhaul your entire portfolio purely for tax reasons. Private equity carries higher risk than listed equities and often requires capital to be locked up for 10 to 15 years. Moreover, the private equity market is currently struggling, raising the question of whether genuine bargains are available today — no matter how attractive the tax treatment may seem.

Looking at China pays off

This week I am taking over the market commentary from my colleague Jan Reyns, so it makes sense to highlight his top picks as well. In Spamalot 176 (which you can rewatch), he explained his investment case for Anta Sports and Puma. Anta Sports is the market leader in China and the world’s third-largest sportswear company, after Nike and Adidas. The group previously struck gold by acquiring the exclusive rights to the Fila brand in China. Jan recently pointed out that Anta Sports might go shopping in Europe and potentially acquire Puma. These rumours intensified in early January and were officially confirmed in Hong Kong this morning. Anta Sports is acquiring a 29% stake in Puma for 1.5 billion euro. What stands out most is the price: Anta Sports is paying 35 euro per share. Puma closed on Monday at 21.63 euro, even after a 16.9% jump that day. That represents a premium of 62% over Monday’s closing price. The fact that the Chinese group is willing to pay so far above the market price suggests it sees substantial hidden value in Puma. Just like Jan. Well spotted, Jan!

Did you know…

that Michael Burry was one of the first to lay the groundwork for the GameStop frenzy back in 2019, but exited his position entirely just before the hype around the stock erupted? The share price would later surge by a factor of 80 within a few weeks — a rally he completely missed himself.

This article was translated from Dutch and was originally published on Spaarvarkens.be.