Asia markets mixed as China trade tumbles more than expected

Palantir Technologies lifted its forecast for annual revenue on Monday as it sees an opportunity to commercialize artificial intelligence, but not all analysts are on the same page.

Dan Ives, managing director at Wedbush Securities, is bullish on the U.S. firm’s AI ambitions. The investment firm said “a star is born,” referring to Palantir’s AI platform, AIP. The platform allows militaries and businesses to tap large language models and AI to support decision-making.

However, another analyst disagreed and said Palantir is “not truly a generative AI company.”

“When we look at Palantir and based on our conversations with [industry observers and Palantir’s employees], this does not appear to be anything truly differentiated when it comes to generative AI,” said Rishi Jaluria, managing director at RBC Capital Markets, on CNBC’s “Squawk Box Asia” on Tuesday.

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— Sheila Chiang

China’s trade plunged more that expected in July, with the country recording a 14.5% year-on-year drop in exports, and a 12.4% fall in imports.

Both metrics were lower than expectations from economists polled by Reuters, who expected a 12.5% slide in exports and a 5% drop in imports.

Customs data from China showed that total trade for July came in at $482.92 billion, a 13.6% fall year on year, while the country’s trade surplus stood at $80.6 billion, down 19.4% compared to July 2022.

— Lim Hui Jie

Household spending in Japan fell 4.2% year-on-year in June, a steeper fall than the 4% recorded in May reflecting a fourth straight month of decline, according to official data.

Food still made up the largest proportion of household spending, the largest fall was spending on furniture and household utensils, down 17.6% year on year.

The average monthly consumption expenditures per household for June was 275,545 yen ($1,932.41) , while the average monthly income per household stood at 898,984 yen in June, down 5.6% from the previous year.

— Lim Hui Jie

The S&P 500 could decline by 10% by the end of the year to correct for a recent rise in valuation multiples, according to hedge fund manager Dan Niles.

The portfolio manager said he sees several macro-economic headwinds that make valuing the S&P 500 at current levels “much more difficult”.

He also revealed his latest two Big Tech stock ideas.

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— Ganesh Rao

Top tech investor Paul Meeks says he’ll likely buy the dip in stocks, as he doesn’t expect a significant and long-lasting downturn, he told CNBC.

He names the ones in tech that he’s bullish on, including two titans and one small-cap stock he says is “too cheap.”

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— Weizhen Tan

Morgan Stanley named several stocks to play Europe’s investment in renewable energy — and highlighted a “once-in-a lifetime” opportunity in the electricity sector in particular. 

The bank estimated the transition to green power sources will cost around 5 trillion euros ($5.5 trillion) between now and 2030.

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— Lucy Handley

The rally in Berkshire Hathaway shares gained steam on Monday as investors cheered a strong quarter as well as Warren Buffett’s near-record cash hoard.

Berkshire’s Class A shares climbed 2.7% to hit an all-time high of $547,907.55 on an intraday basis, exceeding the conglomerate’s previous high from March 2022. Class B shares of Warren Buffett‘s conglomerate rose a similar 2.8%, on track to close at a record high.

New York Federal Reserve President John Williams said rate cuts could happen as soon as next year if the data complies.

In an interview with the New York Times, the influential policymaker said he’s encouraged with what he’s seeing on the inflation front and thinks there may be room to ease off on policy tightening.

“So I do think that from my perspective, to keep maintaining a restrictive stance may very well involve cutting the federal funds rate next year, or year after, but really it’s about how are we affecting real interest rates — not nominal rates,” Williams said, according to a transcript of the interview with the Times’ Jeanna Smialek.

Williams also hinted that the Fed could be done hiking rates as policy is “pretty close to what a peak rate would be.”

His comments were largely in line with projections the Federal Open Market Committee released in June.

—Jeff Cox

Federal Reserve Governor Michelle Bowman said Monday she expects more interest rate increases will be needed to bring down inflation.

In brief remarks before a Fed Listens public hearing, the central bank official said “additional increases will likely be needed to lower inflation to the” 2% inflation goal.

“I will be looking for evidence that inflation is on a consistent and meaningful downward path as I consider whether further increases in the federal funds rate will be needed, and how long the federal funds rate will need to remain at a sufficiently restrictive level,” Bowman added.

Markets widely expect the Fed to hold rates steady when it meets again in September.

—Jeff Cox

Tesla shares fell 1% before the bell after the electric vehicle maker announced the departure of Zachary Kirkhorn as chief financial officer after 13 years at the company.

The company appointed accounting chief Vaibhav Taneja to fill the position.

— Samantha Subin