January 8 Financial Briefing: Signs of weakness in the labor market, decline in US Treasury yields, significant divergence in tech stocks, Alphabet's market value surpasses Apple

Market Overview

On Wednesday (January 7), global financial markets showed mixed performance. The three major U.S. stock indices fluctuated, with the Dow Jones Industrial Average down 0.94%, the S&P 500 slightly down 0.34%, and the Nasdaq up 0.16%. The China Golden Dragon Index retreated 1.58%. European stock markets also exhibited varied trends, with Germany’s DAX 30 up 0.92%, the UK FTSE 100 down 0.74%, and France’s CAC 40 roughly unchanged.

Market Data Highlights

U.S. Stock Market

• Dow Jones Industrial Average: down 0.94%
• S&P 500: down 0.34%
• Nasdaq: up 0.16%

Cryptocurrency Market

• Bitcoin: currently at $96.67K, up 1.78% in 24 hours
• Ethereum: currently at $3.35K, up 1.83% in 24 hours

Commodities and Forex

• Gold: down 0.86%, at $4456 per ounce
• WTI Crude Oil: down 1.0%, at $56.4 per barrel
• U.S. Dollar Index: up 0.14%, at 98.72
• U.S. 10-year Treasury Yield: approximately 4.15%, down 2 basis points from the previous trading day

Hong Kong Derivatives

• Hang Seng Night Futures: closed at 26,348 points, 111 points below yesterday’s close
• China Enterprises Night Futures: closed at 9,106 points

Labor Market Shows Clear Signs of Cooling

U.S. employment data signals weakness, with several indicators underperforming. In December, private sector employment increased by only 41,000 jobs, below the expected 50,000. Meanwhile, job vacancies in November fell to 7.146 million, below the market expectation of 7.6 million, hitting a new low in over a year.

More notably, the nationwide unemployment rate rose to 4.6%, the highest in nearly four years, up 0.4 percentage points from the previous month. Economists estimate that the December unemployment rate may fall back to 4.5%, but overall employment growth remains weak. Market data shows that since mid-2024, multiple factors such as tariff policies, reduced immigration, and AI development have exerted significant pressure on employment growth. The average monthly increase in jobs over the past six months has been only 17,000, far below the average of 147,000 per month in the year leading up to April 2025.

Service Sector Surprises with Stronger-than-Expected PMI

Contrasting the employment weakness, U.S. service sector activity has shown unexpectedly strong performance. The December Non-Manufacturing Purchasing Managers’ Index (PMI) released by the Institute for Supply Management rose to 54.4, reaching a new high since October last year and surpassing market expectations of 52.3 and the previous month’s 52.6.

The new orders component surged from 52.9 to 57.9, and the employment index increased from 48.9 to 52, indicating signs of a hiring rebound. Export orders also grew at the fastest pace in over a year, reflecting relatively stable market demand.

Tech Stocks Lead the Rally, Alphabet Surpasses Apple as Market Cap Leader

The technology sector led the market rebound, with Alphabet’s stock rising 2.5%, reaching a market cap of $3.88 trillion, surpassing Apple’s $3.84 trillion after five years, marking the first time since 2019 that the two giants reversed positions. This ranking reversal highlights differing strategic focuses on AI between the two tech giants.

Alphabet’s strong start in 2025 includes the November launch of its seventh-generation tensor processor Ironwood, seen as a potential rival to NVIDIA’s products; and the December release of Gemini 3, which has received widespread industry recognition. In contrast, Apple has been somewhat passive following the AI wave triggered by ChatGPT, with plans to launch a new Siri AI assistant delayed, and recent downgrades in its outlook by Wall Street analysts.

Microsoft and NVIDIA’s stock prices both rose over 1%, while Tesla declined slightly by 0.4%.

Investment and Financing News

Anthropic’s Funding Round Expands Again

Chatbot developer Anthropic plans to raise $10 billion at a valuation of $350 billion, nearly doubling its valuation from four months ago. The round is led by Singapore’s sovereign wealth fund GIC and Coatue Management, marking the third major funding for the company in the past year. Previously, in September last year, Anthropic raised $13 billion at a valuation of $183 billion. Current investors include Lightspeed Venture Partners, Fidelity Management, and Iconiq Capital. It is also reported that NVIDIA and Microsoft intend to inject a combined $15 billion.

Commodities and Energy News

Goldman Sachs expects continued volatility in silver prices. Despite a historic rally in 2025, tight London inventories will continue to amplify price swings. Declining supply-side inventories have created conditions for market squeezes, which could accelerate price increases; when supply tightness eases, prices may sharply retreat.

ExxonMobil announced that its Q4 profits will decrease by $800 million to $1.2 billion due to falling oil prices, although increased fuel production margins partially offset losses in the oil business.

Key Focus for Today

• Switzerland December Consumer Price Index (CPI) month-over-month
• Eurozone November Producer Price Index (PPI) month-over-month
• Eurozone November Unemployment Rate
• Eurozone December Industrial and Economic Sentiment Indices
• U.S. December Challenger Job Cuts
• U.S. Initial Jobless Claims for the week ending January 3
• U.S. October Trade Balance
• U.S. EIA Natural Gas Inventories for the week ending January 2