Category: Morning Brief

Crude Dips as Russian Disruptions Limit Downside

Posted on by Olumide Adesina

Crude oil prices saw a minor decrease on Wednesday. Oil traders are anxiously awaiting the Federal Reserve’s decision on interest rate cuts due to persistent geopolitical concerns that are keeping prices low. Brent crude futures fell to $68.30 a barrel, while West Texas Intermediate crude futures fell to $64.40 a barrel.

Concerns about possible disruptions in Russian oil supplies were a major factor in the recent price increase.

 

Investors are also looking forward to the results of the Federal Reserve’s meeting on September 16–17, which will include discussions involving new governor Stephen Miran, who is currently on leave from the Trump administration, and Lisa Cook, another policymaker who is facing removal threats from President Donald Trump. It is widely expected that the central bank will lower interest rates by 25 basis points during this meeting, a move that could stimulate economic growth and boost demand for fuel.

 

Additionally, the potential for further 25-basis-point rate cuts in October and December suggests that any “buy-the-rumor, sell-the-fact” behavior in risky assets, such as crude oil, is likely to be short-lived.

 

The American Petroleum Institute recently reported that, during the week ending September 12, distillate stocks increased, while crude and gasoline stocks declined. Specifically, distillate inventories rose by 1.91 million barrels, crude stocks decreased by 3.42 million barrels, and gasoline inventories fell by 691,000 barrels. Analysts had predicted a decrease of roughly 900,000 barrels in crude inventories, an increase of about 1 million barrels in distillate stockpiles, and a rise of approximately 100,000 barrels in gasoline stockpiles, according to a Reuters poll.

Gold Crumbles Below Record High as Dollar Steals Shine

Posted on by Olumide Adesina

The bullion asset drifts lower on Wednesday after failing to find acceptance above the $3,700 mark the day before. Price action showed the yellow metal appears to have ended a three-day winning streak at the all-time high.

The greenback made a slight recovery from its lowest level since early July, putting pressure on precious metals amid repositioning trades ahead of the important FOMC rate decision.

Despite a positive fundamental backdrop, the downside for XAU/USD remains limited.

Gold traders have been factoring in the potential for a more aggressive policy easing by the US Federal Reserve (Fed) amid indications of a softening labor market. The dollar’s recovery attempt may be restrained, and the non-yielding gold may continue to receive some support. Additionally, the cautious market sentiment and growing geopolitical tensions may help limit losses for the safe-haven XAU/USD pair. Traders may also choose to hold off until they receive additional warnings.

The US dollar marginally recovers from a one-and-a-half-month low as bears choose to reduce their wagers in anticipation of the pivotal FOMC policy decision. Consequently, following the recent blowout rally to a record high, there is some profit-taking around the gold price on Wednesday during the Asian session.

Retail sales increased by 0.6 percent in August, for the third consecutive month, and at a faster rate than expected, according to a report released by the US Census Bureau on Tuesday.

Investors are sure that the US Federal Reserve will cut borrowing costs by at least 25 basis points to help the softening labor market. Additionally, by the end of this year, traders will have been factoring in the potential for two more rate cuts

Trump Hails China Trade Talks Amid TikTok Deal Breakthrough

Posted on by Olumide Adesina

The U.S. may finally address concerns surrounding TikTok. In a post on Truth Social, President Trump claimed that a deal was reached during the recent U.S.-China trade talks.

He stated that discussions with China were progressing well and that an agreement had been reached regarding a specific company, widely understood to refer to TikTok. Trump wrote, “The United States and China’s major trade meeting in Europe has gone very well and is nearing its conclusion. Additionally, an agreement has been reached regarding a certain company that our nation’s youth are eager to preserve. They will be overjoyed! I will meet with President Xi on Friday. The partnership remains very strong!”

TikTok has until September 17 to decide whether to sell its U.S. operations or shut them down entirely. Trump is expected to extend the deadline once more, marking the fourth extension since his return, as trade negotiations continue to show progress.

Treasury Secretary Scott Bessent stated that a “framework” agreement for TikTok already exists between the two parties.

He remarked, “The commercial terms have been agreed upon, but it’s between two private parties.” Trump mentioned in June that TikTok was being considered for purchase by a group of “very wealthy people.” He indicated that potential bidders could include Elon Musk, the CEO of Tesla, Larry Ellison, the chairman of Oracle, and others. Following this announcement, Oracle’s stock rose by over 3%.

A second round of trade negotiations between the U.S. and China is currently underway in Spain, aimed at easing tensions between the two largest economies in the world. Earlier today, China accused Nvidia of violating its anti-monopoly laws following an initial investigation and confirmed that further inquiries into chip manufacturers are ongoing.

Trump has expressed optimism about the possibility of a breakthrough; however, restrictions on advanced AI GPUs are expected to remain, and current tariffs will still be in effect.

Elon Musk’s $1 Billion Tesla Stock Buy Sparks 6% TSLA Surge

Posted on by Olumide Adesina

Elon Musk announced that he purchased Tesla stock for the first time since February 2020, leading to a surge in share prices. Musk made a significant insider purchase on Friday, acquiring 2.57 million shares at various prices, totaling approximately $1 billion.

Traders viewed this as a vote of confidence from the outspoken CEO.  Tesla’s stock price increased by around 6%.

 

Shares closed slightly lower for 2025, despite the recent rally, with the stock rising more than 25% over the past three months. This type of purchase is rare for Musk; according to Verity data, he last acquired about 200,000 shares on February 14, 2020, for around $10 million. Verity notes that this is the most valuable purchase he has made to date.

Earlier this month, the company announced that it would seek shareholder approval for a new compensation package for Musk, potentially reaching up to $975 billion, contingent on several ambitious milestones. Before Friday’s acquisitions, Musk owned approximately 13% of Tesla.

Tesla’s stock has encountered difficulties due to a decline in sales, which can be partly attributed to Elon Musk’s political actions that have negatively impacted the brand, as well as the removal of certain electric vehicle incentives by the Trump administration. According to TipRanks.com, analysts hold mixed opinions about the stock. The Wall Street consensus price target indicates a potential decrease of approximately 20% from its current level.

While many are optimistic that Musk can effectively restructure the business to focus more on autonomous driving, artificial intelligence, and robotics, he is also seeking shareholder approval for Tesla’s investment in his latest venture, xAI.

Google: Alphabet Hits $3 Trillion, Citi set $280 Price Target

Posted on by Olumide Adesina

Alphabet became the latest sign that sentiment toward the parent company of Google was improving, joining a select group of businesses valued at over $3 trillion. A market capitalization of just over $3 trillion was reached after shares increased by as much as 4.3 percent to $251.22.

Nvidia Corp. and Alphabet are among a shortlist of companies worth more than $3 trillion. Microsoft Corporation and Apple Inc. are the only other publicly traded stocks valued higher than that.

A long-awaited antitrust ruling spared the search giant from the most severe penalties that regulators had proposed, such as the sale of Alphabet’s Chrome browser. This decision followed Alphabet’s second-quarter earnings report, which showed that the demand for artificial intelligence products is boosting sales.

Citigroup Inc. analyst Ron Josey raised his price target for the stock from $225 to $280, citing “an accelerated product development cycle that is beginning to emerge with greater Gemini adoption across both its Ads and Cloud businesses.” “In what we believe to be a relatively healthy online advertising market, there is increased clarity regarding its legal and regulatory challenges,” added Joey.

“We think Google is performing better across its halo of products, experiencing greater demand, and delivering improved PR,” the statement reads, despite competition facing the company’s search business.

In a note to clients, he stated, “We believe Google is executing better across its halo of products, experiencing greater demand, and delivering improved profitability.”

US-China Talks Heat Up: Trade, TikTok Take Center Stage

Posted on by Olumide Adesina

US and Chinese representatives discussed TikTok, trade, and the economy during a day of high-level talks in Madrid.  A Chinese delegation led by Vice Premier He Lifeng and a US delegation led by Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer met for nearly six hours on Sunday.

Bessent said “We’ll start again in the morning.”. The status of ByteDance Ltd. and matters about national security are on the agenda. This week is the deadline for TikTok to reach an agreement to continue operating in the US.

As early as October, when they are scheduled to attend a summit in South Korea, officials were also expected to set the stage for a possible meeting between Xi Jinping and Donald Trump.

During a press briefing, Trump stated that negotiations regarding TikTok are “going fine,” but emphasized that the platform’s future will ultimately depend on actions taken by China. He mentioned, “Depending on the situation, we might either let it die or— I’m not sure,” adding that it’s “up to China.” 

 

Furthermore, the Chinese Ministry of Commerce announced that a delegation will arrive in Spain from September 14 to 17.

This trip is part of a broader agenda for September. A U.S. official is scheduled to meet with counterparts in both Spain and Britain during his trip, planned for December 12 to 18. This week, Trump is also set to travel to the UK.

China has launched two investigations into the U.S. semiconductor industry, including an anti-dumping probe focused on specific American-made analog IC chips. These actions were taken ahead of the talks scheduled for Sunday and followed the United States’ decision to add 23 additional Chinese companies to its entity list.

This list imposes restrictions on companies that are considered to be acting against the national security or foreign policy interests of the United States.

Opendoor Closes Up 80% on CEO Bombshell – Rabois Returns as Chairman in Power Move

Posted on by Olumide Adesina

Opendoor’s shares soared nearly 80 percent on Thursday following the appointment of co-founder Keith Rabois as chairman and Shopify executive Kaz Nejatian as CEO. This year, the company has seen extraordinary growth, with its stock rising over 500 percent and achieving a 52-week high.

Former CEO Carrie Wheeler resigned following a pressure campaign from investors, which included strong criticism from hedge fund manager Eric Jackson, who has significantly contributed to the stock’s recovery this year, along with Rabois. Both Rabois and Eric Wu, the company’s first CEO, who resigned in 2023, will return to the board as part of Opendoor’s announcement on Wednesday that it is “going into founder mode.”

Opendoor went public in 2020 by merging with a special purpose acquisition company (SPAC). The company uses technology to buy and sell homes, keeping the profits for itself. According to Nejatian, Opendoor intends to leverage artificial intelligence to “radically simplify, speed up, and streamline” the home buying and selling process.

Gold stops Glowing ahead of U.S inflation data

Posted on by Olumide Adesina

Gold prices slightly declined, wiping out some of the gains made after the Federal Reserve’s decision to loosen policy was bolstered by a surprise decline in US producer prices.

The yellow metal dropped as much as 0.5 percent to about $3,623 an ounce, about $50 less than the peak set earlier this week.

US producer prices unexpectedly declined for the first time in four months in support of traders’ wagers that US borrowing costs will be lowered next week. Later on Thursday, consumer price data will be the next key data point to watch.

The bullion asset was down 0.3 percent at $3,631.33 an ounce after closing 0.4 percent higher on Wednesday. Silver fell closer to $41 an ounce after rising more than 40% this year. Palladium and platinum dropped.

Metal traders now anticipate a quarter-point decline at the Fed’s September meeting. In an attempt to boost the economy after a string of poor labor market data, policymakers are likely to implement two more cuts by the end of the year. The 16–17 meeting is a lock. Since gold doesn’t generate interest, lower rates typically favor it. This year, the price of gold has increased by almost 40%, making it one of the most successful major commodities. Gold-backed exchange-traded funds have seen an increase in investor capital due to growing expectations of US rate cuts.

Oracle Propels 40% as Larry Ellison Dethrones Elon Musk as World’s Richest Man

Posted on by Olumide Adesina

Larry Ellison, 81, the founder of the US software company Oracle, surpassed Elon Musk as the world’s richest person on Wednesday. Ellison’s wealth increased by $101 billion to $393 billion on Wednesday, while Elon Musk’s wealth was $385 billion. It was the biggest wealth increase Bloomberg has ever seen in a single day. Ellison is now at the top of Bloomberg’s list of the wealthiest people for the first time.

This honor is due to Oracle’s soaring share price, which jumped over 40 percent on Wall Street on Wednesday. The demand for artificial intelligence is driving the rapid expansion of the group’s cloud business. A significant amount of processing power is required for this growth.

The development of AI, which requires ever-increasing computing storage capacity, is largely responsible for this commercial success.

His achievement is attributed to the remarkable surge in his share price on the New York Stock Exchange. Investors have evaluated the strong demand for AI infrastructure that the American cloud provider will benefit from in the coming years, despite the challenges it presents. Its order book has increased fourfold to $455 billion in a year.

Oracle’s valuation has skyrocketed from $250 billion to over $940 billion in just a few hours. Unlike the flashy personality of Elon Musk, Larry Ellison, 81, maintains a more discreet presence. He owns an extensive real estate portfolio and various assets, including the island of Lanai in Hawaii, which is the sixth-largest island in the U.S. Pacific archipelago. Ellison purchased Lanai for $300 million in 2010.