Investment Learning

  • June 6, 2024

US Federal Regulators to Investigate Dominance of Microsoft, OpenAI, and Nvidia in AI Industry

According to Odaily, US federal regulators have reached an agreement to launch an antitrust investigation into the dominant positions of Microsoft, OpenAI, and Nvidia in the artificial intelligence industry. This move is seen as the strongest indication of an upgraded regulatory review of this powerful technology. Insiders revealed that the US Department of Justice and the Federal Trade Commission reached this agreement over the past week and it is expected to be finalized in the coming days. According to the agreement, the Department of Justice will lead the investigation into whether the behavior of Nvidia, the largest artificial intelligence chip manufacturer, has violated antitrust laws. The Federal Trade Commission will play a leading role in reviewing the behavior of OpenAI and Microsoft. This move signifies a significant step in the regulatory scrutiny of the AI industry, as these companies hold substantial influence in the sector.

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  • June 5, 2024

Why equities are your 'best opportunity' to beat inflation

The ADP National Employment Report showed private payroll growth slowed in May, signaling a cooling labor market ahead of Friday's jobs report. GDS Wealth Management chief investment officer Glen Smith joins Market Domination to discuss the print and what it means for the Federal Reserve's next interest rate decision. "I think the market is softening a bit as evidenced by the ten-year Treasury coming down, so I think there's going to be some opportunities here going forward in terms of volatility," Smith explains. As inflation continues to be a stressor, he recommends investing in equities as "the best opportunity to beat that inflation number." He points to financials and energy as two attractive sectors in which to invest. When it comes to financials, Smith calls JPMorgan Chase (JPM) the "best breed of bank," as the net interest margin is attractive and lending should pick up when rates fall. On the energy side, he highlights Halliburton (HAL) as a great investment opportunity despite its underperformance. He believes that investors should buy the dip as the company has strong financials and currently sits as one of the largest oil service providers in the world. As inflation continues to put pressure on the economy, Smith believes a rate cut could come in September. Until then, he believes "this is a great time to look at your portfolio. Make sure you're diversified. A lot of allocations have kind of gotten out of whack with [the] 'Magnificent Seven,' everything going on. Make sure you're not over-concentrated in any one sector or stock that might be a little bit speculative at this point." For more expert insight and the latest market action, click here to watch this full episode of Market Domination. This post was written by Melanie Riehl

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  • June 5, 2024

Economists Predict Federal Reserve's First Interest Rate Cut in September

According to Odaily, a survey of 116 economists revealed that 74 of them predict the Federal Reserve will make its first interest rate cut of 25 basis points in September. Only five economists forecast a rate cut in July, a decrease from 11 in a May survey. No one predicted a rate cut in June. Oscar Munoz, Chief US Macro Strategist at TD Securities, stated that the Federal Reserve is in a favorable position considering the current monetary policy's constraints on the economy. Out of the 116 respondents, 68 predicted two rate cuts this year, roughly consistent with last month's survey. With persistent high inflation, particularly the PCE price index, and extremely low unemployment rates, the possibility of an early rate cut is slim. The median forecast shows that inflation indicators such as CPI, core CPI, PCE, and core PCE are not expected to reach 2% until at least 2026. The unemployment rate is expected to remain close to the current 3.9% until at least 2027, indicating that the labor market will continue to be tight.

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