No, not that kind of bang that you see in Hollywood racy series.
More like this one.
2024 has been a great year for investments in general. Bitcoin hits the US$100,000 market because of Trump. Nvidia surpassed Apple as the biggest company in the world in terms of market capitalisation.
Squid Game got a season 2, but I didn’t watch season 1. But apparently, it has TOP doing this inside.
That’s how you know things got REAL in 2024. This is the last newsletter for the year, so let’s end it on a bang by reviewing which markets did the best, and what should we look out for in 2025.
5 Market News You Definitely Need to Know
Source: WSJ
Nordstrom: It seems that America’s beloved retailer, Nordstrom, is being taken private by its family members and El Puerto De Liverpool for US$6.3 billion.
- It has tried to do so in March 2024, as it has struggled to regain its sales and competitive edge after the pandemic.
- The purchase price of US$24.25 is about the same as its current share price, where it has gained by 33% for the year.
CATL: Chinese electric battery manufacturer, CATL is considering listing in the Hong Kong market pending government approvals.
- CATL is the world’s biggest EV battery maker with a 37% market share, followed by BYD (17%) and LG Energy (12%).
- Bain and Co. projects that the global EV battery market will grow at an average of 14.4% every year to 2030 to reach US$500 billion.
Aviva: Aviva is acquiring Direct Line for US$4.7 billion to create the UK’s largest home and motor insurance player.
- Demand for private healthcare services also boomed in 2024, as the UK government healthcare provider, NHS, spends a record amount on private healthcare too. This has caused Aviva’s profits to rise in 2024, and have the cash to acquire Direct Line.
Tenaga Nasional: TNB will raise electricity tariffs by 14.2% in July 2025, and it will apply until 2027.
- According to BMI, electricity demand is expected to increase by 20% from 187TWH in 2024 to 220TWH in 2033, a 1.9% average yearly increase.
- TNB’s financials have only recently rebounded to their pre-pandemic level in 2023 and 2024, as the government asked it to lower its electricity tariffs during the pandemic.
Pan Merchant: Pan Merchant Berhad is planning to list itself in the ACE market in Malaysia.
- It manufactures filters for solid liquid filtration and provides steel works and technical support services.
Global Stock Markets Review in 2024
It has certainly been an excellent year for Taiwan, the United States, Japan, Vietnam, Hong Kong, Singapore, China and Malaysia.
Taiwan’s surge in 2024 can be explained by the AI boom. AI needs computing power. And computing power needs semiconductor chips. Taiwan is especially good at making them with TSMC being the biggest in the world.
The U.S. continues to fly to record highs in 2024, as the AI boom pushes companies such as Nvidia, and Super Micro Computer to the forefront.
Japan is just off three decades of slow growth and deflation, with inflation finally back. Now, consumers are spending and businesses are investing.
Vietnam is in this unique position of being the beneficiary of the U.S. and China trade/technology war. Both U.S. and Chinese companies who want to escape the sanctions are now turning to Vietnam to relocate their factories.
Hong Kong and China are both intertwined with each other. It has not been a particularly great year in 2024, but 2023 was worse.
Lastly, Malaysia. It has been a strong year. But one that could have been stronger. It seems like there isn’t much domestic events happening that are pushing the market higher. If anything, it was the improvement in the world’s economy that has lead to Malaysia’s stock market registering this performance.
There are primarily 5 things that I am watching out for in terms of market trends and events.
#1: Will China be Stronger in 2025?
This is essentially my number one question heading into 2025.
Starting 2023, hopes were high that the biggest economy in the world will be growing at a breakneck speed that will boost the stock market.
But till now, nothing but disappointment.
Youth unemployment is at around 18% now, and consumer confidence in the economy is still weak. Then in the second half of 2024, the government decided to go “Fu — it” and aggressively increase their spending in the economy in hopes to bring back confidence.
It worked for about 2 weeks, but optimism quickly evaporated. At its core, it still has a lot of REAL issues.
Its property market is still in shambles. With most of the people’s wealth concentrated in properties, it makes sense that no one is spending with declining house prices.
But factor in also the weak business profits that are coming out of the country, you have a problem. Industrial profits have now declined for 3 consecutive months from September 2024 onwards.
The International Monetary Fund (IMF) projects China’s economic growth to go down to 4.5% in 2025 from 4.8% in 2024.
Will China go down the same path as Japan in having low growth and deflation? Inflation has been stubbornly low in 2024.
#2: How Strong will the AI Boom still be in 2025?
It is no secret that the AI industry now drives most of the U.S. markets’ gains.
But how long will this party last?
What started from 2022 has now gone over into 2024. Nvidia went from a fringe company selling nerdy gaming set-ups to an AI behemoth that has recently become bigger than Apple.
Investors are still VERY optimistic in this next frontier in the market. Estimates of the market range from an annual growth rate of 20.4% to 40%.
But are valuations running ahead of real tangible results and improvements of AI to companies?
So far, I have not seen any significant implementation of AI to company operations that are mind-blowing. It is coming, but it is up in the air how big of an improvement this will be.
#3: Will the Chinese EV Industry continue its Price War?
Tesla started it in 2023, and the Chinese EV companies are continuing it into 2024.
Chinese EV companies are slashing prices left, right and centre to outcompete each other in the local and global EV market.
Going into 2025, it seems they will continue to do so. BYD, in a leaked email, has asked one of its suppliers to cut their raw material prices.
So far, it seems like there are a few clear winners — BYD, Xpeng, Leapmotor and Zeekr, where they have recorded record sales in 2024.
But trouble is on the horizon again from Europe. They have decided that Chinese EV companies are not playing by the rules and are being subsidised by the CCP. So, tariffs it is then.
And Mr Trump is also not that friendly. The Chinese EV industry has each other to worry, and also outside forces.
Russia and Ukraine are still fighting.
Israel and Palestine are still fighting.
Both conflicts seem to be going on forever. No one really knows when they will end.
But they have impacts on crude oil, natural gas and other commodity prices. Best to keep close tabs on them.
#5: Will Malaysia’s Data Centre Foreign Investments Pay Off?
Malaysia has just been voted the best country for data centres in Southeast Asia by Knight Frank.
All the big boys — Amazon, Microsoft, Oracle, Google — are setting up data centre shops here.
But the eternal question is this — will these investments benefit Malaysia?
I have previously written about them here, and my takeaway was that these investments look eerily similar to the ones we encouraged back in the 1980s.
Foreign companies come in. They employ cheap labour, guard their trade secrets. And benefit from our tax incentives without giving anything away.
Projections for 2025 to Look At
World Economic Projections by IMF
S&P 500 Forecast by FX Empire
Global AI Market Forecast by MarketDataForecast.
Quote to End 2024
We often find ourselves at the crossroads going into a new year, of what we have done for the year. To continue seeking for more on the road travelled and paved by most of us, or to forge a path for ourselves away from societal conventions and expectations. The first guarantees some form of security and expectations on how a life is lived, but comes with the despair of letting society mold your life and image. The second guarantees nothing, a life that changes by the day, hour and second, one in which you fret about the security of your financial life while others and society ‘leave’ you behind, but gives freedom and authenticity of the self. — By me
