In a groundbreaking announcement, US President Donald Trump unveiled the "Stargate" project, a $500 billion initiative aimed at advancing the United States' artificial intelligence (AI) infrastructure. The project will begin with an initial investment of $100 billion to establish state-of-the-art data centers and related infrastructure in Texas. This bold move comes as part of a broader strategy to position the US at the forefront of AI technology globally.
The announcement coincided with a positive market response following Trump's inauguration, with US stocks showing significant gains. Major indices like the S&P 500, Nasdaq 100, and Dax saw modest increases, reflecting investor confidence in the new administration's economic policies. The US Treasury curve also saw a flattening trend, driven by buying interest at the long end, indicating a shift in market dynamics.
The "Stargate" project is expected to be a cornerstone of the US's efforts to build a robust AI ecosystem. The initial $100 billion investment will focus on developing advanced data infrastructure in Texas, with plans to scale up to $500 billion over time. This initiative underscores the government's commitment to fostering technological innovation and maintaining global competitiveness in AI.
In the stock market, US equities had a promising start post-inauguration, buoyed by strong earnings reports. Companies like Netflix and 3M reported significant growth, with Netflix shares surging by 14% after-hours and 3M seeing a 4% increase. The Nikkei 225 also opened positively, up by 0.8%, while other global indices displayed mixed performances. The S&P 500 Futures rose by 0.3%, Nasdaq 100 by 0.7%, and Dax by 0.1%, whereas the FTSE 100 saw a slight decline of 0.1%.
In currency markets, the US Dollar maintained modest gains, reflecting steady investor sentiment. Meanwhile, New Zealand's inflation index showed a year-on-year increase of 3.1%, marking a three-year low. The country's Q4 CPI figures aligned with expectations, indicating stable economic conditions.
Taiwan reported a remarkable growth in export orders for December, achieving a year-on-year increase of 20.8%, the fastest pace since early 2022. This surge highlights the resilience of Taiwan's export sector amid global economic uncertainties.
In Indonesia, the Economic Minister announced a new policy requiring exporters to keep foreign exchange earnings onshore for one year. This measure aims to stabilize the country's currency and strengthen its foreign reserves.
The Bank of Japan (BOJ) made an announcement regarding its bond-buying operations, reducing purchase amounts in line with December guidance. The BOJ is also moving toward a decision to raise interest rates at its upcoming policy meeting on January 24th, signaling a shift in monetary policy.
China's central bank, the People's Bank of China (PBOC), conducted open market operations by injecting CNY1.16 trillion in 14-day reverse repos and net injecting CNY198 billion. These measures are part of efforts to manage liquidity in the financial system.
Gold prices continued their upward trend for the third consecutive day on Wednesday, surpassing the $2,750 level during the Asian session. This rise marks the highest level since early November, driven by increased demand for safe-haven assets amid global economic uncertainties.
“Main Street” Russell small-cap, Dow and S&P all outperformed Nasdaq.