Pre-market trading in US stocks | Netflix surges 10% leading the tech stocks! Chinese concept stocks soar, Jack Ma becomes the largest single shareholder of BABA-SWR

Top News in US Stocks

1. The People's Bank of China announced on its official website that starting from February 5, 2024, the reserve requirement ratio for financial institutions will be lowered by 0.5 percentage points (excluding financial institutions with a 5% reserve requirement ratio already in effect). After this adjustment, the weighted average reserve requirement ratio for financial institutions will be approximately 7.0%. Starting from January 25, 2024, the rates for re-lending to support agriculture, small and micro businesses, and rediscounting will be lowered by 0.25 percentage points.

2. According to public data cited by the South China Morning Post, SoftBank has almost no BABA-SWR stocks left, and Jack Ma has replaced SoftBank as the largest shareholder. Citing a research report from Morgan Stanley on May 11, 2023, the South China Morning Post reported that according to Morgan Stanley's estimation, SoftBank's holdings of BABA-SWR have decreased from 6-7% in December 2022 to less than 0.5% in May 2023.

It is reported that SoftBank has been selling off its most profitable BABA-SWR stocks in order to compensate for the massive capital requirements of the Vision Fund in recent years. About six months ago, Jack Ma's stake of around 4.5% surpassed SoftBank, making him the largest shareholder of Alibaba.

1. According to media reports citing insider information, Tesla has informed its suppliers that it plans to start production of a new mass-market electric vehicle codenamed "Redwood" in mid-2025. The vehicle is positioned as a "compact crossover." In response to this, a Tesla China spokesperson said, "We have never heard of it."

2. On January 22, Ant Group's largest shareholder, Hangzhou Junhan Equity Investment Partnership (Limited Partnership), underwent a change in its business registration. Hangzhou Yunbo Investment Consulting Co., Ltd. withdrew as a partner and executive partner, while Hangzhou Xingtao Enterprise Management Consulting Co., Ltd. was added as a partner and executive partner. Currently, the partnership consists of Hangzhou Junjie Equity Investment Partnership (Limited Partnership), Hangzhou Xingtao Enterprise Management Consulting Co., Ltd., Jack Ma, and Xie Shihuang.

3. Regarding the rumors of TikTok's acquisition of Ele.me in the market, on January 24, Yu Yongfu, Chairman of BABA-SWR Local Services Group and CEO of Ele.me, clarified the rumors to all employees on the company's intranet, stating that "what is fake will always be fake."

4. NetEase Games has announced the schedule for limited playtime during the 2024 NetEase Games Winter Break: Children can experience games from February 9th to 17th, from 20:00 to 21:00 each day, for a total of 16 days during the winter break.

Pre-market Movement

In pre-market trading, futures for the three major stock indices are rising, while the fear index is plummeting.

Tech stocks are generally rising, with Netflix leading the way with a gain of over 10%. AMD is up over 2%, while NVIDIA, Tesla, Amazon, and Meta are up over 1%.

Chinese stocks are generally surging, with Bilibili up nearly 5%, NetEase up over 3%, and Baidu, NIO, and Pinduoduo up over 2%. BABA-SWR and JD.com are up over 1%, while XPeng is down nearly 1%. In terms of individual stocks, Intuitive Surgical rose more than 7% in pre-market trading, with Q4 revenue exceeding expectations and a positive outlook for business volume in 2024.

Getaround surged nearly 80% at one point. In terms of news, Getaround announced the establishment of a new debt financing mechanism with Mudrick Capital Management, with a financing amount of up to $20 million, and an initial withdrawal of $5 million.

Gaotu Online Education rose more than 4% in pre-market trading, with institutions setting a high target price of $3.8, and an expected 15% increase in total revenue for Q4.

Strategy Review

1. Musk plans to launch a $25,000 entry-level car in 2025? Tesla responds!

There have been continuous rumors in the market about Musk's plan to make an affordable car, while Tesla has repeatedly postponed and denied it.

2. With the upcoming release of earnings reports, the "Tech Seven Sisters" in the US stock market are making a comeback, leading the S&P 500 to break historical highs

According to analysts' estimates, the average return rate of the "Seven Sisters" in the US stock market over the next 12 months is 8.6%. The seven major US tech giants have already achieved a return rate of 4.4% this month, outperforming the S&P 500 by more than two percentage points. Investors are pouring into US tech stocks, resulting in the largest two-week capital inflow since August last year.

3. "Bond King" Gross: US stocks appear to be overinflated, and the US economy is facing a severe recession

"Bond King" Bill Gross warned that stock valuations are too high and a severe recession is a real threat, as the US is caught in a debt spiral. Gross stated that the record high of the S&P 500 index is meaningless to him. He believes that stock market valuations have not significantly declined, and the price-to-earnings ratio must be balanced with actual interest rates.

He urged investors to remain cautious and allocate funds to lower-risk stocks. Gross also called on the Federal Reserve to relax its control over the economy as soon as possible to avoid stifling economic growth and triggering a recession. At the same time, he reminded investors to pay attention to political and military risks.

4. SLM counterattacks LLM? Microsoft bets on smaller and cheaper "big models"

Analysis points out that Microsoft's close cooperation with OpenAI has made the performance of the GPT model far surpass other models in the large model market. In addition, Microsoft's smaller-scale Phi series can further seize the long-tail market of open source models.

5. Understanding the market | Why is NVIDIA no longer the "number one chip stock"?

Why did Morgan Stanley elevate Western Digital to its top recommended stock while downgrading NVIDIA to second place? The bank believes that the spin-off will unleash business potential and combined with the recovery of the storage market, Western Digital's stock price has a 28% upside potential, with an "extremely striking" valuation gap compared to other companies in the same industry.