Breakfast | Alibaba rises another 5%, up over 14% in three days! Tesla rebounds over 2% after five consecutive declines, Meta rises for eighteen consecutive trading days

Market Overview

U.S. inflation data exceeded expectations, leading to a rapid rise in U.S. Treasury yields, causing all three major U.S. stock indices to decline at the start of trading. However, they later rebounded from their lows, with only the Nasdaq narrowly closing higher.

The S&P 500 index fell by 16.53 points, a decrease of 0.27%, closing at 6051.97 points. The Dow Jones Industrial Average, closely tied to the economic cycle, dropped by 225.09 points, a decline of 0.50%, closing at 44368.56 points. The Nasdaq, which is heavily weighted with technology stocks, rose by 6.09 points, an increase of 0.03%, closing at 19649.95 points.

The "Tech Seven Sisters" had mixed results. Tesla rose by 2.44% (after falling 3.58%, 1.0%, 3.39%, 3.01%, and 6.34% in the previous five trading days). Reports indicate that Tesla plans to launch fully autonomous driving and ride-hailing services in Texas in June this year, but compared to competitors like Waymo and BYD, it seems to have lost its leading edge in the smart driving sector.

Apple rose by 1.83%. Meta increased by 0.76%, marking its eighteenth consecutive trading day of gains. Media reports state that Meta is discussing the acquisition of South Korean chip company FuriosaAI or the manufacturing of its own AI chips. Microsoft fell by 0.58%, Alphabet A dropped by 0.92%, NVIDIA declined by 1.25%, and Amazon fell by 1.65%.

Additionally, Intel rose by over 7%, rebounding nearly 18% over three days; Cisco surged over 6% after its earnings report. The Chinese concept index rebounded nearly 3%, with Alibaba rising nearly 5%, accumulating over 14% in three days.

Putin Invites Trump to Visit Russia, Zelensky and Trump Discuss Possibilities for Peace

On February 12 local time, U.S. President Trump stated that he had a long and very productive phone conversation with Russian President Putin that day. Trump indicated that both sides wish to end the Russia-Ukraine conflict and agreed to closely cooperate, including visiting each other's countries. On the same day, Zelensky spoke with Trump, and they discussed the possibility of achieving peace. Trump also shared details of his conversation with Putin during the call.

Powell's Congressional Hearing the Next Day: The Federal Reserve May Adjust Rates Due to Tariffs, CPI Shows More Efforts Needed to Reduce Inflation

Powell stated that the CPI indicates the Federal Reserve is close to but has not yet achieved its inflation target, and the Fed will not be swayed by the ups and downs of one or two data points; he hinted that interest rates will remain high in the near term, stating, "We hope to maintain a restrictive policy for the time being"; he mentioned, "There is enough time to wait" for restrictive monetary policy to take effect, "there are ways to continue to reduce the balance sheet," and reiterated that reserves are "ample"; he stated that even if Trump requests, he will not resign; the Federal Reserve has not been cut off from accessing the data needed for its work, and DOGE's access to the payment system is very cautious; the establishment of the Federal Reserve's Vice Chair for Financial Supervision position has led to greater fluctuations in regulatory policy; the Federal Reserve has not prohibited the banking sector from participating in cryptocurrency business; the 2020 policy framework did not restrict the Fed's response to inflation.

U.S. January CPI Exceeds Expectations Across the Board! Year-on-Year Growth Rate Rises to 3%, Core CPI Accelerates to 0.4%

In January, the U.S. CPI rose by 0.5% month-on-month, marking the largest increase since August 2023 and accelerating for the seventh consecutive month. The inflation process faces the risk of reversal, and coupled with a solid labor market, the Federal Reserve is likely to remain inactive in the foreseeable future Traders have adjusted their expectations for the next Federal Reserve interest rate cut from September to December. Before the January CPI is released, traders are inclined to expect two rate cuts this year. The "New Federal Reserve News Agency" stated that the strong inflation data in January undermines the rationale for the Fed to further "readjust" its rate cut path before mid-year.

Trump Calls for Rate Cuts Again, Attributes January's Strong CPI to "Biden Inflation," Market Unconvinced

On Wednesday Eastern Time, Trump stated that interest rates should be lowered. Subsequently, the U.S. released the January CPI data, which exceeded expectations across the board. Trump again criticized this inflation report as "Biden inflation." Analysts suggest that Trump's move aims to avoid potential political risks at the beginning of his second term. The January CPI data includes 12 days during Trump's presidency.

Minister Ma Prescribes "Medicine" for the U.S. Economy: Relax Regulations, Achieve 5% Economic Growth, and Reduce Deficit by $1 Trillion Without High Inflation

On Tuesday, Musk appeared at the White House with his young son, attending a press conference alongside Trump. He warned that if the U.S. does not cut its budget, it will face the risk of "bankruptcy," emphasizing that reducing federal spending is essential. He advocates for relaxing regulations and promoting economic growth to cut the deficit. He predicts that if the economy grows by $1 trillion and the deficit is reduced by the same amount, there will be no inflation in 2026, which will help lower loan interest rates and living costs for Americans.

Last Year's Hottest Tech Stock AppLovin Reports Q4 Earnings and Q1 Guidance Exceeding Expectations, Stock Price Rises Over 22% After Hours

AppLovin's Q4 EPS was $1.73, while analysts expected $1.26. Q4 revenue was $1.37 billion, compared to analysts' expectations of $1.26 billion. Q4 advertising revenue was $999.5 million, exceeding the expected $892 million. For Q1, total revenue is expected to be between $1.36 billion and $1.39 billion, while analysts expected $1.32 billion. Adjusted EBITDA for Q1 is expected to be between $855 million and $885 million, compared to analysts' expectations of $793.9 million.

CICC: A Few Thoughts on the Recent Surge in Hong Kong Stocks

CICC stated that this round of surge lacks long-term foreign capital (holding type, most important), but there should be short-term foreign capital (such as passive funds, trading funds). This time, it is still a structural market, and it is a more extreme structural market, with only over 20% of stocks outperforming the index.

Bank of America: DeepSeek is China's "Alibaba IPO Moment"

Bank of America stated that Alibaba's listing in 2014 led to the rise of China's "new economy" sector, attracting global long-term capital inflows. DeepSeek may become the current "Alibaba IPO moment" for the Chinese stock market. The "Holy Grail" of AI development in China may not necessarily be "best in class," but rather "good enough" to support large-scale AI applications in China and drive productivity and economic growth.

Cisco's Stock Price Rises Over 6% After Hours

Cisco's adjusted EPS for the second fiscal quarter was $0.94, compared to an expected $0.91. For the third fiscal quarter, revenue is expected to be between $13.9 billion and $14.1 billion, while analysts expected $13.88 billion. The company expects an adjusted EPS for the full year to be between $3.68 and $3.74, compared to its original expectation of $3.60 to $3.66 The expected annual revenue is between USD 56 billion and USD 56.5 billion, while the company originally anticipated between USD 55.3 billion and USD 56.3 billion. The board of directors has authorized an additional USD 15 billion stock repurchase plan