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NVIDIA (NVDA)
Chipmaker Nvidia has overtaken Apple (AAPL) to once again become the most valuable company in the world, after the company’s shares rose during Tuesday’s session.
Nvidia now has a market capitalization of almost $3.45 billion (£2.79 billion), compared to Apple’s $3.35 billion, with the iPhone maker’s shares falling 3% during the previous session.
Nvidia shares rose more than 2% on Tuesday and 2.5% in pre-market trading on Wednesday.
This happened after newly reinstated President Donald Trump announced a new $500 billion in private sector investment build artificial infrastructure in the United States.
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The first funders of “Project Stargate” are OpenAI, Oracle (ORCL), SoftBank (9984.T) and MGX, while Nvidia is one of the first technology partners.
Ben Barringer, technology analyst at Quilter Cheviot, said: “This development is undeniably a boon for the AI sector. The companies involved in delivering the technology and infrastructure to Project Stargate are well-positioned to benefit significantly.
“This decision highlights the growing strategic importance of AI innovation, reinforcing its role as a cornerstone of economic and technological progress. For AI investors, this announcement highlights a host of opportunities as competition to dominate the sector intensifies.
Oracle (ORCL)
Oracle shares jumped 7% on Tuesday and 8% in pre-market trading Wednesday morning, following Trump’s announcement.
The stock was also trending after Trump reportedly said at an event Tuesday that he would be open to Oracle Chairman Larry Ellison or Tesla (TSLA) CEO Elon Musk buys social media app TikTok, in a joint venture with the US government.
According to a Bloomberg report, Trump said, “I have the right to make a deal.”
“So what I’m thinking of saying to someone is buy it and give half of it to the United States of America, half of it, and we’ll give you the permit, and they’ll have a great partner,” he added.
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In one of his first actions after being sworn in for a second presidential term on Monday, Trump signed an executive order to delay a ban on TikTok in the United States.
Asked about Trump’s proposal that Chinese company ByteDance, which owns TikTok, would hand over half of the platform to an American company, Guo Jiakun, spokesperson for the Chinese Ministry of Foreign Affairs said: “TikTok has been operating in the United States for years and is very popular with American users.”
“This has played a positive role in boosting employment and consumption in the United States. We hope that the United States will seriously listen to the voice of reason and provide an open, fair, just and non-discriminatory business environment to market entities in all countries.”
Netflix (NFLX)
Netflix shares rose 14% in pre-market trading on Wednesday, after the the streaming giant reported 18.9 million users in the fourth quarter, with revenues and profits also beating expectations.
Fourth-quarter revenue of $8.83 billion was up 12.5% year-over-year and diluted earnings per share were $2.11 for the final three months of its fiscal year. .
The company also announced a $15 billion stock repurchase and raised its full-year revenue forecast to between $43.5 billion and $44.5 billion. That was ahead of its previous range of $43 billion to $44 billion.
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Strong subscriber gains came thanks to Netflix ending 2024 with two back-to-back NFL games, a successful “Jake Paul vs. Mike Tyson” boxing match and the return of the wildly popular “Squid Game” series.
Matt Britzman, senior equity analyst at Hargreaves Lansdown (HL.L), said: “Netflix keeps us on our toes with new content slates, attracting millions of new viewers while keeping existing customers happy. This is the latest quarter that Netflix has reported net subscriber growth, and it exceeded expectations.
“As rivals raise prices and struggle with losses, Netflix is raking in cash and striking deals like WWE and NFL to bolster its programming. Competitors selling their best shows to Netflix only bolster its library, allowing us to watch – and, above all, pay.
In Europe, shares of sportswear brand Adidas jumped nearly 7% Wednesday morning, after the company reported stronger-than-expected preliminary fourth-quarter results.
Adidas’ revenue rose 24% to €5.97 billion (£5.05 billion) in the fourth quarter, while operating profit rose to €57 million in the quarter, up from an operating loss of 377 million euros.
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Rising stocks helped lift the pan-European STOXX 600 index (^STOXX) to a record level on Wednesday morning.
Analysts at Deutsche Bank said in a note Wednesday that they have a “buy” rating on the stock.
“Our buy argument on Adidas is based on growing brand popularity, positive earnings momentum and strong EPS growth,” they said. “All of this is demonstrated again in the 4th trimester.”
J.D. Wetherspoon (JDW.L)
Shares in British pub operator JD Wetherspoon plunged almost 2% into the red on Wednesday, after the company’s chairman Tim Martin warned of rising costs.
Martin has previously warned that costs at Wetherspoons will rise this year by £60 million a year, due to the Autumn Budget’s increases in employers’ national insurance contributions and the national minimum wage.
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“Government-mandated pay rises are having a much bigger impact on pub and catering businesses than supermarkets,” Martin said.
Derren Nathan, head of equity research at Hargreaves Lansdown (HL.L), said: “There is no more vocal campaigner for landlords’ rights than chairman Tim Martin, who has pointed out that volumes of pubs’ biggest product line, beer, have collapsed by 52% between 2000 and 2023.
“Average prices on the trade are now £4.98 a pint and are much more sensitive to rising labor costs than their supermarket equivalents, where you can buy 568ml of the refreshment for a average price £1.20.”
In the trading report, JD Wetherspoon reported 5.1% like-for-like sales growth.
Other companies in the news for Wednesday January 22:
Computer Rigetti (RGTI)
Arm holds (ARM)
Apple (AAPL)
Kia (000270.KS)
Procter & Gamble (PG)
Johnson & Johnson (JNJ)
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