Breakfast | S&P 500 hits new highs for two consecutive days, popular stocks decline, media reports DeepSeek is considering raising external funds for the first time

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S&P 500 Hits New Closing High, Intel Falls 6%

Trump issued new tariff threats on Tuesday evening. On Wednesday, major European stock indices fell, with the pan-European index experiencing its largest daily drop of the year. U.S. stock indices opened lower, but the S&P repeated its intraday turnaround from Tuesday, narrowly maintaining its upward momentum by the close.

All three major U.S. indices closed higher, with the S&P continuing to set historical highs, marking two consecutive trading days of new closing records. By the close, the Dow rose 0.16%, the Nasdaq gained 0.07%, and the S&P 500 increased by 0.24%.

Large tech stocks showed mixed results, with Intel down over 6%, Meta falling more than 1%, and Amazon and Nvidia slightly down; Tesla and Microsoft rose over 1%, while Apple, Netflix, and Google saw slight increases.

Palantir dropped about 10%, marking its largest single-day decline since August last year, following the Trump administration's order to cut the defense budget by 8% annually over the next five years. Analog Devices rose nearly 10%, achieving its best single-day performance since May 2024. HIMS surged over 17%, reaching an all-time high, with a cumulative increase of over 184% this year.

Chinese concept stocks were mixed, with the Nasdaq Golden Dragon China Index down 0.38% and the Wind Chinese Technology Leaders Index down 1.23%. Among popular Chinese concept stocks, Semiconductor Manufacturing International Corporation rose over 9%, Century Internet increased by more than 8%, Hutchison China MediTech gained over 8%, Zhihu rose over 7%, GDS Holdings increased by over 5%, and Daqo New Energy rose over 5%. WeRide fell over 15%, Lotus Technology dropped more than 13%, Tiger Brokers declined over 5%, and Tencent Music fell over 3%.

Morgan Stanley Raises 2025 Hang Seng Index Target to 24,000 Points

Morgan Stanley upgraded MSCI China from underweight to equal weight; raised the 2025 MSCI China Index target to 77; and increased the 2025 Hang Seng Index target to 24,000 points.

U.S. President Trump Issues New Tariff Threats

He will announce tariffs on automobiles, semiconductors, chips, pharmaceuticals, and possibly lumber within the next month or even sooner. Meanwhile, he stated that he is committed to pushing for massive tax cuts and working with the Republican Congress to implement the largest tax reduction policy in U.S. history.

Microsoft Releases Majorana 1 Quantum Chip and Generative AI Tools

Microsoft launched the Majorana 1 quantum chip, which features a new topological core architecture and utilizes the world's first topological conductor, a groundbreaking material capable of observing and controlling Majorana particles. Microsoft believes this will enable it to produce practical quantum computers by the end of this decade. The new architecture of the Majorana 1 processor can accommodate millions of quantum bits on a single chip, creating a full-sized quantum computer. Additionally, Microsoft debuted its generative AI tool Muse, designed for creating video game scenes.

Media: DeepSeek Considers First External Funding

DeepSeek has not yet raised external funding, partly to avoid pressure from investors to commercialize its products too quickly. However, according to insiders, the company has recently considered external financing due to the need for more AI chips and servers to cope with rapidly growing usage and support model development. Executives are also discussing whether to shift focus from primarily research to building a business that can generate substantial revenue and ultimately achieve profitability DeepSeek founder Liang Wenfeng remains cautious about external fundraising. According to informed sources, Alibaba has expressed interest in investing in DeepSeek. However, Alibaba has not yet responded officially to this.

Google Gemini may add AI video generation feature

This feature has not yet been officially launched, and the release date is uncertain. The code includes "videogen" appearing alongside "robin" (the internal code name for Gemini), and contains prompts such as "We will notify you when ready," suggesting that Gemini may have AI video generation capabilities.

Tencent Yuanbao: Hunyuan T1 deep thinking model is now available for unlimited use

Tencent's Hunyuan T1 and DeepSeek-R1 are both reasoning models. These models can understand multiple dimensions of a problem and potential logical relationships, making them particularly suitable for completing complex tasks. In Tencent Yuanbao, users can not only utilize the full version of DeepSeek-R1 and Hunyuan T1 for deep thinking but also quickly output answers using DeepSeek-V3 and Tencent Hunyuan Turbo.

Alibaba AI To C begins large-scale recruitment, opening hundreds of AI positions

Additionally, Alibaba Cloud announced that its data center in Mexico has officially started operations, marking Alibaba Cloud's first data center in the Latin American region.

Ant Group opens recruitment for embodied intelligent humanoid robot systems and applications

Ant Group stated that it registered Shanghai Ant Lingbo Technology Co., Ltd. last year, focusing on embodied intelligence technology and product development. In the future, Ant Group will continue to expand its layout and increase investment in AI.

Apple releases iPhone 16E, starting price of $599

Apple has launched the iPhone 16E, starting at $599, which is more affordable than other models in the iPhone 16 series but higher than analysts' expectations. It is equipped with the A18 chip, Apple Intelligence, and the company's first cellular modem, Apple C1. The iPhone 16E will start pre-orders on February 21 and will be available on February 28.

Bank of America: Tariffs expected to have a negative impact of 2% to 3% on Apple's profits

If a 10% tariff is imposed on all devices sold by Apple in the U.S., analysts expect earnings per share to decrease by 26 cents. If Apple raises prices by about 3%, earnings per share for the calendar year 2026 will decrease by 21 cents, and Apple device sales will drop by 5%. Analysts noted that Apple has shifted some production to India, but the equivalent tariffs in India may be higher than 10%.

Two departments in mainland China release "2025 Action Plan for Stabilizing Foreign Investment"

Expand the opening trials in telecommunications, healthcare, education, and other fields; remove restrictions on foreign-invested companies using domestic loans.

JD.com and Meituan will pay social security for delivery riders

U.S. electric truck manufacturer Nikola files for bankruptcy

Federal Reserve meeting minutes: Potential impact of Trump policies raises inflation concerns, hopes to see further progress on inflation before interest rate cuts

Trump's preliminary policy suggestions have raised concerns at the Federal Reserve about rising inflation, as tariffs and stricter immigration policies could increase inflationary pressures, potentially offsetting the positive effects of tax cuts and deregulation. Participants "generally pointed out the upside risks to the inflation outlook," rather than risks to the labor market.

"Federal Reserve Mouthpiece": Federal Reserve Officials Consider Slowing or Pausing Balance Sheet Reduction

Nick Timiraos reported that Federal Reserve officials discussed whether to slow down or pause the reduction of its nearly $6.8 trillion asset portfolio at last month's meeting, as they face complex issues related to raising the federal debt ceiling in the coming months.

Global Central Banks Continue to Cut Interest Rates, China Awaits Opportunity for Reserve Requirement Ratio and Interest Rate Cuts

Due to falling inflation or economic pressure, major global central banks continue to cut interest rates. The Reserve Bank of Australia cut rates for the first time since 2020 on Tuesday, and the Reserve Bank of New Zealand lowered rates again by 50 basis points. The market expects the Bank of Thailand may also cut rates again next week. For China, due to the cooling expectations of Federal Reserve rate cuts, the inverted interest rate differential between China and the U.S., and the pressure on the RMB exchange rate from trade tariff frictions, attention must continue to be paid to changes in external circumstances regarding reserve requirement ratio and interest rate cuts