"From a data perspective, we saw some weakness from the latest Chinese services PMI, which eased back to 52.6. Nonetheless, we have seen some positive updates out of Asia, with the US and China removing their trade barriers in accordance with the agreements made between Trump and Xi. Meanwhile, the Chinese Premier Li Qiang pledged to open their consumers to international businesses following last week's discussions."
"Recent declines across equities, gold, and crypto marked an abrupt end to a number of momentum trades, with some noting the bearish positions in Nvidia and Palantir by Michael Burry ('big-short') as a sign that the overstretched valuations in the tech space are at extremes that will soon spark market tops. For a market that is so heavily reliant on the health of big tech stocks, a popping of the AI bubble essentially means collapse in financial markets as a whole."
Asian and European indices opened lower as volatility resurfaced, with Japan's Nikkei 225 and South Korea's Kospi retreating from recent record highs. Chinese services PMI eased to 52.6, while US and China removed trade barriers under prior bilateral agreements. Chinese Premier Li Qiang pledged to open consumer markets to international businesses. Equities, gold, and crypto saw recent declines, and bearish positions in Nvidia and Palantir by Michael Burry highlighted concerns about overstretched tech valuations. The potential popping of an AI-driven tech bubble poses systemic risk. The US Supreme Court is hearing a case on tariff lawfulness amid the longest US government shutdown, increasing uncertainty.
Read at London Business News | Londonlovesbusiness.com
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