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Morning Research Notes - 20.03.25
US markets closed higher yesterday, buoyed by the Federal Reserve's decision to keep interest rates unchanged and its continued forecast for two rate cuts this year, despite ongoing inflation concerns. Commodities had a mixed day on Wednesday. Gold increased by 0.4% to $US3046.26 an ounce, Brent oil rose by 0.4% to $US70.87 a barrel, while iron ore decreased by 1.7% to $US100.40 a tonne.
Wall Street closed higher yesterday as the Federal Reserve left interest rates unchanged, maintaining its forecast for two rate cuts this year despite acknowledging persistent inflation challenges. The S&P 500 rose by 1.1%, the Dow Jones Industrial Average gained 0.9%, and the NASDAQ Composite increased by 1.4%. Fed Chairman Jerome Powell highlighted solid economic conditions and a resilient labour market, suggesting that weaker growth might help counterbalance higher inflation. In the corporate sector, Tesla's stock surged over 4% following progress towards launching its robotaxi service in California. Boeing's stock jumped 7% after positive remarks from its CFO about operational performance, while Nvidia's stock rose more than 2% as its CEO downplayed the impact of tariffs. Conversely, General Mills' stock fell 2% due to a forecasted decline in annual sales and profit amid increased competition from cheaper private label brands.
The Australian market closed lower on Wednesday, with the ASX200 falling by 0.41%. Major sectors, including Materials, Info Tech, Financials, and Utilities, all ended in negative territory, closing down by 0.66%, 0.97%, 0.27%, and 1.58% respectively. Contrastingly, Healthcare notched gains, closing up by 0.54%. Major commodities had a bearish day, with Copper, Zinc, and Nickel all closing in the red. In contrast, Aluminium recorded a slight gain, rising by 0.07%.
Reid Hoffman of Greylock Partners discusses the four personas of AI sentiment in his book Superagency: What Could Possibly Go Right with Our AI Future: Doomers, Gloomers, Bloomers, and Zoomers. According to a survey, while all groups claim familiarity with generative AI, Gloomers and Bloomers constitute a similar proportion of the workplace, whereas Doomers are a clear minority. For investors, this declining "Doomer" sentiment among employees suggests a sustained and growing demand for AI technologies. The market for AI products and services is projected to reach between $780 billion and $990 billion by 2027 indicating significant opportunities for investment in AI-related innovations.
Source: McKinsey
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