Category: Daily Instagraph

French operator of call centres Teleperformance painfully experienced yesterday what the AI disruption can do to investor confidence. At one stage the stock tumbled 29% intraday after Swedish payments and shopping service, Klarna, said that its OpenAI-powered assistant would handle two thirds of the company’s customer service chats. Teleperformance felt obliged to issue a statement … Continued

Technology and tech related sectors now represent ½ of the value of the US stock market index. The weight of defensive sectors, like food producers, food retail, utilities or pharma, is down to 20%. Cyclicals, as industrials, energy, financials or commodities, have fallen to 30%. While technology has worked extremely well for investors over the … Continued

Warren Buffett presented solid annual results of Berkshire Hathaway over the weekend. The below diagram gives the overview on the strength of the underlying businesses and demonstrates how the holding realized 97 bn USD in net profit. The cash balance reaches now 168 bn USD. The company bought back 9.2 bn USD last year as … Continued

In our ECP house-view we had formulated the opinion that, by the end of last year, investors got too optimistic on future rate cuts by the Fed and that the bond market had gotten slightly ahead of itself. That proved correct as for example the US 10 year bond government bond yield is up from … Continued

NVIDIA shares jumped 11% in late trading yesterday on results and sales forecasts above consensus. Japanese Nikkei 225 is back to a level reached last time 35 years ago. But there are also some signs that not every investor is sharing the current optimism. Corporate insiders are currently selling stock at record pace…

Europe remains by far the cheapest developed equity market not only compared to the US and Japan but also compared to its 20 years history. What is little known however is that European companies have outperformed their US peers in terms of profit growth since 2021, especially once excluding the Magnificent 7. Why that?  Amongst … Continued

The below table summarizes the y-t-d returns ( in USD ) of the major liquid asset classes till mid-February. It is of course still too early to draw any conclusions for 2024, but noticeably the biggest positive performers were oil, US and Japanese equities. The biggest losers were Asia ex Japan, industrial metals and government … Continued

Meta stock gained 20% or a stunning 171 bn USD in market cap on its results last Friday, in a single trading session! This brings Meta into the league of the 10 companies having experienced the biggest daily increases in market cap ever. You will recognize in the same club other ‘Magnificent 7’ companies. To … Continued

The Magnificent 7 continue to pull the S&P 500 ahead. Even we, as value investors, need to admit that their stock market performance was mainly driven by outstanding earnings growth and not by multiple expansion. Going forward, consensus expects the Magnificent 7 to grow their topline at 12% a year over the next 3 years. … Continued

As Warren Buffett wrote in his 2020 annual letter: “Despite some severe interruptions, our country’s economic progress has been breathtaking. Our unwavering conclusion: Never bet against America.” Equity returns are a good proof of the strength of corporate America as illustrated by the yearly returns of the S&P 500 over the last century. Not only … Continued