U.S. Stock Market Outlook | Futures for the three major indices rise together, signs of cooling in the cryptocurrency "Trump frenzy"

1. As of December 10th (Tuesday) before the US stock market opens, the three major US stock index futures are all up. As of the time of writing, Dow futures are up 0.02%, S&P 500 index futures are up 0.12%, and Nasdaq futures are up 0.13%.

1. As of the time of writing, the German DAX index is up 0.44%, the UK FTSE 100 index is down 0.60%, the French CAC40 index is down 0.62%, and the Euro Stoxx 50 index is down 0.36%.

1. As of the time of writing, WTI crude oil is down 0.78%, priced at $67.84 per barrel. Brent crude oil is down 0.72%, priced at $71.62 per barrel.

Market News

The "Trump Frenzy" in the cryptocurrency circle shows signs of cooling, and cryptocurrency volatility returns. As the optimism triggered by the support of incoming President Trump for the cryptocurrency industry begins to wane, a wave of selling has impacted the cryptocurrency market. On Tuesday, Bitcoin briefly fell below $95,000, while an index measuring smaller digital assets dropped by 15%, marking one of the largest intraday declines of 2024. As of the time of writing, Bitcoin hovers around $97,000. After the US election on November 5th, speculators heavily invested in cryptocurrencies, spurred by Trump's promise to create a supportive regulatory environment and his controversial support for a national Bitcoin reserve. Meanwhile, the notorious volatility of digital assets has led investors to quickly exit their bets. Bitcoin reached a record high of $103,800 on December 5th but has struggled to maintain levels above six figures.

US ports are extremely busy! Tariff and strike threats loom, retailers are in a stocking frenzy. The National Retail Federation (NRF) stated on Monday that the busy US ports have seen a surge in freight volume in November and December, with inbound freight expected to hit a new record. With the holiday shopping season approaching and global shipping bottlenecks, US retailers have begun to stock up early, but the prospect of a port strike in mid-January next year and President-elect Donald Trump's plan to raise tariffs have prompted large importers to accelerate their purchases. Jonathan Gold, NRF's Vice President of Supply Chain and Customs Policy, stated, "The window for shipping goods ahead of a potential strike is rapidly closing. Additionally, the promise of increased tariffs from President-elect Trump will also pose challenges." After temporarily halting strikes in October, the International Longshoremen's Association (ILA) and the employer group United States Maritime Alliance (USMX) have seen disagreements arise again in November U.S. Consumers Expect Inflation to Rise, but Remain Optimistic About Personal Financial Prospects. According to a report released by the New York Federal Reserve on Monday, although U.S. consumers expect inflation levels to rise in the coming years, they are optimistic about the improvement in their personal financial situation. The New York Federal Reserve's November consumer expectations survey showed that consumers expect an inflation rate of 3% one year from now, up from 2.9% in October; the expected inflation rate for three years from now is 2.6%, also slightly higher than last month's 2.5%. The five-year inflation expectation rose from 2.8% in October to 2.9%. The New York Federal Reserve noted that education level affects future inflation expectations: "Inflation expectations for one to three years have generally increased, but the group without a college degree has seen a decline in expectations, while the group with a college degree has seen an increase."

Citi's Outlook for 2025: S&P 500 Could Reach 6900, Fed Rate Cut Cycle Uninterrupted. Investors generally expect U.S. stocks to rise further in 2025, but Citi believes that given the already high market valuations, investors should prepare for more volatility. A team of strategists led by Scott Chronert at Citi expects the target price for the S&P 500 index to be 6500 in the baseline scenario, 6900 in the bull case, and 5100 in the bear case. Their basic forecast is considered cautious on Wall Street, with predictions from other investment banks ranging from 6400 to 7000. Chronert and his team stated that the consistent theme across all scenarios is "modest profit growth in the worst case" and "the index valuation at year-end remains above average, which aligns with our view of the market being in a sustained bull market."

Individual Stock News

Cloud Computing Business Steady Growth, Oracle (ORCL.US) Q2 Earnings Report No "Big Surprises." Oracle's Q2 revenue was $14.1 billion, a 9% year-over-year increase. The much-watched cloud infrastructure business saw revenue soar 52% to $2.4 billion, in line with market expectations. As of November 30, the remaining performance obligations (a measure of orders) were $97 billion, down from $99.1 billion in the previous quarter. The adjusted earnings per share were $1.47, slightly below the market expectation of $1.48. Total cloud revenue (including infrastructure and applications) was $5.9 billion, while analysts had estimated $6 billion. Oracle CEO Safra Catz stated in a statement that cloud revenue will exceed $25 billion in the fiscal year ending in May. This outlook aligns with Wall Street's expectation of $25.1 billion.

"AI Software Hot Stock" C3.ai (AI.US) Q2 Performance Exceeds Expectations, Raises Fiscal Year Revenue Guidance. C3.ai's Q2 revenue was $94.3 million, a 29% increase year-over-year, surpassing analysts' estimate of $91 million. On an adjusted basis, the company reported a loss of $0.06, while analysts had expected a loss of $0.16. Subscription revenue grew 22% to $81.2 million, while professional services revenue increased 94% to $13.2 million. The company currently expects fiscal year revenue to be between $378 million and $398 million, up from the previous forecast of $370 million to $395 million Analysts previously expected the company's annual revenue to reach $382.6 million. In addition, for the third quarter, C3.ai expects revenue to be between $95.5 million and $105 million, with a midpoint of $98 million slightly higher than the analyst estimate of $97.5 million.

CATL (300750.SZ) plans to establish a joint venture with Stellantis NV (STLA.US) in Spain, with a total investment of €4.038 billion. CATL announced that to further deepen the long-term strategic partnership with Stellantis and support its electric vehicle production and electrification strategic goals, CATL and its subsidiaries signed a joint venture agreement with subsidiaries of Stellantis and other parties on December 10, 2024. CATL and Stellantis plan to jointly invest in establishing a joint venture in Spain, with both parties holding 50% of the shares, and the joint venture will build a battery factory in Zaragoza, Aragon, Spain, with a total investment scale of €4.038 billion.

NVIDIA (NVDA.US) responds to being investigated: We are happy to answer any questions regulators have for us. Today, regarding the regulatory investigation, NVIDIA responded to Sina Technology, stating: "NVIDIA wins with strength, which is reflected in our benchmark results and the value we provide to customers, who can choose any solution that best fits their needs. We strive to provide the best products in every region and fulfill our commitments wherever we operate. We are happy to answer any questions regulators have about our business."

Global advertising sales are expected to exceed $1 trillion for the first time in 2024! Google, Meta, and Amazon account for 40% of the market share. A new report from GroupM, a leading global media investment group, predicts that global advertising revenue will grow by 9.5% to $1.04 trillion this year, marking the first time it has surpassed the $1 trillion milestone. Kate Scott-Dawkins, Global President of Business Intelligence at GroupM, announced this result at the UBS Global Media and Communications Conference in New York on Monday, stating that it is primarily driven by online advertising from websites including Alphabet's Google (GOOGL.US), Meta (META.US), and Amazon (AMZN.US).

MicroStrategy (MSTR.US) buys $2.1 billion in Bitcoin again! Investment strategy sustainability draws attention. MicroStrategy has once again purchased $2.1 billion in Bitcoin, funded by a combination of selling stocks and fixed-income securities to rapidly increase its purchases. According to a document from the U.S. SEC, MicroStrategy bought 21,550 Bitcoins at an average price of approximately $98,783 between December 2 and 8. This marks the fifth consecutive Monday that MicroStrategy has announced the purchase of digital assets. The company's co-founder and chairman decided that this small business software manufacturer needs to take a different path to survival In the past four years, the Bitcoin accumulated by the company is currently worth over $41 billion. At the end of October, MicroStrategy announced a plan called "21/21," which aims to raise $42 billion over the next three years to purchase more Bitcoin.

Important Economic Data and Event Forecast

Next day at 01:00 Beijing time: EIA releases the monthly Short-Term Energy Outlook report.

Next day at 05:30 Beijing time: U.S. API crude oil inventory change for the week ending December 6 (10,000 barrels).

Earnings Forecast

Wednesday morning: GameStop (GME.US)

Wednesday pre-market: Macy's (M.US)