Shoppers at a produce store in the Chinatown district of San Francisco, California, United States, Monday, January 6, 2025.
David Paul Morris | Bloomberg | Getty Images
This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open informs investors about everything they need to know, wherever they are. Do you like what you see? You can subscribe here.
What you need to know today
Inflation fears weigh on US markets
US stocks fell And Treasury yields rose Tuesday while the ISM services index shows a big price increase for December. Asia-Pacific Markets traded mixed on Wednesday. South Korea’s Kospi rose 1.3%. It was boosted by shares of Samsung Electronics, which rose about 3.6% even as the company forecast that its fourth quarter profits would be lower than LSEG’s expectations.
Meta ends fact-checking program
Meta Tuesday announcement it will be eliminate its third-party fact-checking program to “restore freedom of expression” and move to a “Community Notes” model, similar to Elon Musk’s Platform X system. Employees went to their internal forum and criticized the company’s decisioncarried out two weeks before the inauguration of US President-elect Donald Trump.
Anthropic’s potential valuation at $60 billion
Anthropic, the artificial intelligence startup founded by former OpenAI research leaders, is in talks at an advanced stage to raise up to $2 billion at a valuation of $60 billion, CNBC confirmed. The funding round is led by Lightspeed Venture Partners, according to a person familiar with the matter. Anthropic, which has been widely supported by Amazonis the creator of the AI chatbot Claude.
India could benefit from Trump, portfolio manager says
US President-elect Donald Trump’s plans to impose heavy tariffs on China India’s geopolitical positioning “favorable in this Trump 2.0 era,” according to Kunal Desai, portfolio manager of GIB Asset Management. India is an attractive investment destination due to its monetary sovereignty and improved return on equity, Desai said.
[PRO] Warning signs in the stock market
Howard Marks, co-founder and co-chairman of Oaktree Capital Management who predicted the dotcom bubble, sees five warning signs on the stock market. Although Marks isn’t calling it a bubble, he is concerned about signs of stock froth. Here’s what investors should pay attention to, according to Marks.
The essentials
A sign of the extent to which investors are currently worried about the return of inflation, the Institute for Supply Management Services Indexan inflation figure usually secondary to bigger data like the Consumer Price Index, sends shockwaves through the market.
The December ISM report’s price index jumped to 64.4% from 58.2% in November, an increase of more than 10%. This is the first time since January 2024 that the figure has exceeded 60%, noted Steve Miller, chair of the ISM Business Survey Committee.
This could be just the start of an unwelcome upward trend. Miller attributes some of the expansion in service activity to “risk management related to the impacts of port strikes and potential tariffs” – both of which generate inflationary pressures.
In response, investors increased the 10-year Treasury yield to 4.699% during the US trading session, the highest level since April 26. They also lowered their expectations for a 25 basis point rate cut at the U.S. Federal Reserve’s January meeting, assessing a 4.8% chance of that happening, down from a 4.8% chance. . 8.6% probability just a day ago, according to CME Group FedWatch tool.
Stocks suffered. THE S&P500 fell by 1.11%, the Dow Jones Industrial Average fell by 0.42% and the Nasdaq Composite slipped 1.89%, driven by the decline in technology stocks. Nvidia fell 6.2%, ending its three-day winning streak.
“We’re seeing a recalibration of inflation expectations and Fed rate expectations. That’s sparked this slight sell-off in equity markets after the early enthusiasm,” said Tom Hainlin, senior investment strategist at US Bank Asset Management Group.
But the strong ISM report also suggests the U.S. economy is still doing well, providing fertile ground for earnings growth, Hainlin said. And as David Lefkowitz, head of UBS equities at UBS, wrote, “earnings growth matters more” than assessing returns over the next 12 months.
A single data point from an inflation measure cannot chart the course of inflation or business health for the coming year. But it’s worth exercising caution for now.
— CNBC’s Jeff Cox, Sean Conlon, Pia Singh and Lisa Kailai Han contributed to this report.
