Chipmaker AMD on Tuesday announced a $1.5 billion boost to its 2024 forecast for artificial intelligence (AI) processors, aiming for a total of $3.5 billion. However, this optimistic projection fell short of meeting the high expectations set by Wall Street, leaving investors wanting more. <o:p></o:p>

According to Reuters, AMD's stock, which has surged approximately 140 per cent in the past year, saw a decline of about 6 per cent in extended trading as the company also provided first-quarter revenue estimates below Wall Street's predictions.<o:p></o:p>

Investing.com analyst Jesse Cohn expressed disappointment with AMD's performance, highlighting a "notable miss on operating income and operating margins." <o:p></o:p>

Cohn emphasised the challenge the company faced amid elevated expectations, stating, "The company had little margin for error amid lofty expectations, and investors were disappointed with the forward guidance provided for the current quarter." <o:p></o:p>

AMD's CEO Lisa Su acknowledged the company's potential to surpass the projected $3.5 billion worth of AI chip sales once additional capacity comes online in the second half of the year. <o:p></o:p>

However, analysts, who had previously projected figures ranging from $4 billion to $8 billion for the AI segment, found the update fell short of their expectations, impacting the stock valuation.<o:p></o:p>

During a conference call, Lisa Su commented on the soft demand from cloud computing companies within AMD's data centre segment, which includes both traditional server chips and AI processors. <o:p></o:p>

Su noted that as companies strive to develop their own generative AI applications, enterprise budgets are directed towards processors used in AI servers. <o:p></o:p>

With Nvidia holding a dominant 80 per cent market share, AMD's position as a viable alternative in the market is crucial. <o:p></o:p>

Despite the overall growth of AMD's data centre segment by 38 per cent to $2.3 billion, the company faces challenges in the evolving landscape of AI and cloud computing.<o:p></o:p>

AMD's struggles extend beyond the AI segment, with weaknesses evident in the programmable chip market, which has seen a downturn due to a chip supply glut impacting industries like automotive and industrial. <o:p></o:p>

The fourth-quarter embedded segment revenue for AMD fell roughly 24 per cent to $1.1 billion. Additionally, the gaming segment experienced a 17 per cent contraction to $1.4 billion, influenced by reaching peak revenue from chip designs for gaming consoles like Microsoft's Xbox and Sony's PlayStation 5. <o:p></o:p>

While AMD anticipates growth in the PC market with built-in AI capabilities, scepticism remains among investors and analysts regarding the company's ability to meet the expectations set by its competitors.<o:p></o:p>

(With inputs from Reuters)<o:p></o:p>

Chipmaker AMD on Tuesday announced a $1.5 billion boost to its 2024 forecast for artificial intelligence (AI) processors, aiming for a total of $3.5 billion. However, this optimistic projection fell short of meeting the high expectations set by Wall Street, leaving investors wanting more.

Chipmaker AMD on Tuesday announced a $1.5 billion boost to its 2024 forecast for artificial intelligence (AI) processors, aiming for a total of $3.5 billion. However, this optimistic projection fell short of meeting the high expectations set by Wall Street, leaving investors wanting more. According to Reuters, AMD's stock, which has surged approximately 140 per cent in the past year, saw a decline of about 6 per cent in extended trading as the company also provided first-quarter revenue estimates below Wall Street's predictions. Investing.com analyst Jesse Cohn expressed disappointment with AMD's performance, highlighting a "notable miss on operating income and operating margins." Cohn emphasised the challenge the company faced amid elevated expectations, stating, "The company had little margin for error amid lofty expectations, and investors were disappointed with the forward guidance provided for the current quarter." AMD's CEO Lisa Su acknowledged the company's potential to surpass the projected $3.5 billion worth of AI chip sales once additional capacity comes online in the second half of the year. However, analysts, who had previously projected figures ranging from $4 billion to $8 billion for the AI segment, found the update fell short of their expectations, impacting the stock valuation. During a conference call, Lisa Su commented on the soft demand from cloud computing companies within AMD's data centre segment, which includes both traditional server chips and AI processors. Su noted that as companies strive to develop their own generative AI applications, enterprise budgets are directed towards processors used in AI servers. With Nvidia holding a dominant 80 per cent market share, AMD's position as a viable alternative in the market is crucial. Despite the overall growth of AMD's data centre segment by 38 per cent to $2.3 billion, the company faces challenges in the evolving landscape of AI and cloud computing. AMD's struggles extend beyond the AI segment, with weaknesses evident in the programmable chip market, which has seen a downturn due to a chip supply glut impacting industries like automotive and industrial. The fourth-quarter embedded segment revenue for AMD fell roughly 24 per cent to $1.1 billion. Additionally, the gaming segment experienced a 17 per cent contraction to $1.4 billion, influenced by reaching peak revenue from chip designs for gaming consoles like Microsoft's Xbox and Sony's PlayStation 5. While AMD anticipates growth in the PC market with built-in AI capabilities, scepticism remains among investors and analysts regarding the company's ability to meet the expectations set by its competitors. (With inputs from Reuters)

AMD's AI Chip ambitions face Wall Street skepticism despite $1.5 bn boost in forecast

Hopes for lower interest rates and resilient growth in 2024 took the S&P 500 to a record high on Friday, after two roller-coaster years featuring soaring inflation, tumult in the banking industry and economic unease.

Bulls take charge on Wall Street; S&P 500 enters bull market

Citigroup inc. said it expects to incur as much as $1 billion in severance and reorganization costs this year as it continues the process of eliminating 20,000 roles as part of Chief Executive Officer Jane Fraser’s quest to boost the Wall Street giant’s lagging returns.

Job cuts at Citibank: 20,000 roles to be axed by Wall Street giant

Stocks on Wall Street took a break in the last session of 2023 following a surge that brought the market close to all-time highs. Global equities snapped a five-day run-up on Friday, the final session before the New Year weekend. There are now indications of fatigue, suggesting a halt or retreat.

Stocks end stellar 2023 with a whimper

Stock Bull Run takes a break at the end of a banner year

In 2023, economists widely anticipated a recession in the United States as the Federal Reserve raised interest rates to combat high inflation. However, the expected economic downturn never materialised. What are the factors that led to the world's largest economy defying grim expectations?

How the US defied a recession in 2023

In a heated battle for the best minds in artificial intelligence (AI), Wall Street banks are poaching rival talent, with Goldman Sachs taking a notable hit in the past year. &nbsp;

According to a Bloomberg report, citing data compiled by consultancy Evident, Goldman Sachs witnessed a net outflow of 60 AI professionals to competitors like Morgan Stanley and Citigroup in the 12 months through September. This represents the largest exodus among major rivals. &nbsp;

While this departure is a fraction of Goldman Sachs' global workforce of nearly 46,000, it sheds light on the fierce competition for top AI talent.

Commenting on the data, Alexandra Mousavizadeh, CEO of Evident, emphasised the importance of not just hiring but also nurturing and retaining AI talent.

Evident's analysis covered roles in AI development, model risk, data engineering, and software development, showcasing the intense rivalry for AI expertise. Despite the small proportion of departures among thousands of AI staff in banks, these roles are highly coveted and often command some of the highest salaries. &nbsp;

Last year, median compensation for employees in AI-related roles in the US was $901,000, while their European counterparts earned $676,000, according to a report by Heidrick &amp; Struggles. The data presented by Evident does not encompass banks' hiring of AI talent directly from universities and consultancies.

Goldman Sachs, facing a net loss of 106 AI-focused staffers to rivals, has been actively hiring to attract top AI talent. However, this outflow highlights the intense competition in the field. Other banks, such as Bank of America and Wells Fargo, have also experienced shifts in their AI talent pool. &nbsp;

Bank of America saw a net loss of 55 staffers, while Wells Fargo witnessed the largest net increase with 130 people. While JPMorgan Chase &amp; Co. lost 224 AI-focused staffers, it added 325 over the same period, securing one of the most significant net increases in talent among peers.

AI has become integral to the strategies of major banks, with JPMorgan’s CEO Jamie Dimon stating that he believes AI will enable employers to reduce the workweek to just 3.5 days. The recognition of AI's importance is also evident at Citigroup, which plans to empower its 40,000 coders with the ability to experiment with different AI technologies by the end of the first quarter.

(With inputs from Bloomberg)

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In a heated battle for the best minds in artificial intelligence (AI), Wall Street banks are poaching rival talent, with Goldman Sachs taking a notable hit in the past year.

In a heated battle for the best minds in artificial intelligence (AI), Wall Street banks are poaching rival talent, with Goldman Sachs taking a notable hit in the past year. According to a Bloomberg report, citing data compiled by consultancy Evident, Goldman Sachs witnessed a net outflow of 60 AI professionals to competitors like Morgan Stanley and Citigroup in the 12 months through September. This represents the largest exodus among major rivals. While this departure is a fraction of Goldman Sachs' global workforce of nearly 46,000, it sheds light on the fierce competition for top AI talent. Commenting on the data, Alexandra Mousavizadeh, CEO of Evident, emphasised the importance of not just hiring but also nurturing and retaining AI talent. Evident's analysis covered roles in AI development, model risk, data engineering, and software development, showcasing the intense rivalry for AI expertise. Despite the small proportion of departures among thousands of AI staff in banks, these roles are highly coveted and often command some of the highest salaries. Last year, median compensation for employees in AI-related roles in the US was $901,000, while their European counterparts earned $676,000, according to a report by Heidrick & Struggles. The data presented by Evident does not encompass banks' hiring of AI talent directly from universities and consultancies. Goldman Sachs, facing a net loss of 106 AI-focused staffers to rivals, has been actively hiring to attract top AI talent. However, this outflow highlights the intense competition in the field. Other banks, such as Bank of America and Wells Fargo, have also experienced shifts in their AI talent pool. Bank of America saw a net loss of 55 staffers, while Wells Fargo witnessed the largest net increase with 130 people. While JPMorgan Chase & Co. lost 224 AI-focused staffers, it added 325 over the same period, securing one of the most significant net increases in talent among peers. AI has become integral to the strategies of major banks, with JPMorgan’s CEO Jamie Dimon stating that he believes AI will enable employers to reduce the workweek to just 3.5 days. The recognition of AI's importance is also evident at Citigroup, which plans to empower its 40,000 coders with the ability to experiment with different AI technologies by the end of the first quarter. (With inputs from Bloomberg) WATCH WION LIVE HERE

Wall Street talent war: Banks engage in cutthroat competition for AI experts

Chip making giant Nvidia released its third-quarter earnings on Tuesday, once again surpassing Wall Street expectations as the demand for its chips fuelled by the artificial intelligence boom continues to surge. &nbsp;

The reported adjusted earnings per share of $4.02 and revenue of $18.12 billion exceeded analysts' expectations, with analysts anticipating $3.36 earnings per share on $16.1 billion in revenue. The robust Q3 report card showed a 34 per cent increase in revenue from the previous quarter and a whopping 206 per cent surge compared to the same period last year.

The company's guidance for the current quarter also outpaced estimates, with a projected revenue of $20 billion, plus or minus 2 per cent, while analysts were foreseeing a fourth-quarter guidance of $17.8 billion. &nbsp;

Nvidia CEO Jensen Huang attributed the growth to the industry's transition towards accelerated computing and generative AI large language models, with consumer internet companies and global cloud service providers leading the way.

Falling stocks

Despite these achievements, Nvidia's stock saw a 3 per cent decline on Wednesday, a reaction potentially tied to the company's acknowledgement of new restrictions on chip exports to China impacting its results. &nbsp;

Colette Kress, Nvidia's CFO, noted that sales to China and other affected destinations, representing about 20-25 per cent of Data Centre revenue, would decline significantly in Q4 of fiscal 2024 due to licensing requirements. However, Kress expressed confidence in mitigating this decline through strong growth in other regions.

Kress expanded on the impact of export restrictions, stating that the fourth-quarter guidance could have been higher without the restrictions. Yet, there's a possibility Nvidia might collaborate with the US government to launch new products. She acknowledged the uncertainty surrounding the magnitude and duration of the impact on their China business.

WATCH WION LIVE HERE

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Chip making giant Nvidia released its third-quarter earnings on Tuesday, once again surpassing Wall Street expectations as the demand for its chips fuelled by the artificial intelligence boom continues to surge.

Chip making giant Nvidia released its third-quarter earnings on Tuesday, once again surpassing Wall Street expectations as the demand for its chips fuelled by the artificial intelligence boom continues to surge. The reported adjusted earnings per share of $4.02 and revenue of $18.12 billion exceeded analysts' expectations, with analysts anticipating $3.36 earnings per share on $16.1 billion in revenue. The robust Q3 report card showed a 34 per cent increase in revenue from the previous quarter and a whopping 206 per cent surge compared to the same period last year. The company's guidance for the current quarter also outpaced estimates, with a projected revenue of $20 billion, plus or minus 2 per cent, while analysts were foreseeing a fourth-quarter guidance of $17.8 billion. Nvidia CEO Jensen Huang attributed the growth to the industry's transition towards accelerated computing and generative AI large language models, with consumer internet companies and global cloud service providers leading the way. Falling stocks Despite these achievements, Nvidia's stock saw a 3 per cent decline on Wednesday, a reaction potentially tied to the company's acknowledgement of new restrictions on chip exports to China impacting its results. Colette Kress, Nvidia's CFO, noted that sales to China and other affected destinations, representing about 20-25 per cent of Data Centre revenue, would decline significantly in Q4 of fiscal 2024 due to licensing requirements. However, Kress expressed confidence in mitigating this decline through strong growth in other regions. Kress expanded on the impact of export restrictions, stating that the fourth-quarter guidance could have been higher without the restrictions. Yet, there's a possibility Nvidia might collaborate with the US government to launch new products. She acknowledged the uncertainty surrounding the magnitude and duration of the impact on their China business. WATCH WION LIVE HERE

Nvidia soars beyond Wall Street estimates in Q3, but China concerns loom

Anticipation is building on Wall Street as the arrival of Bitcoin exchange-traded funds (ETFs) looms, heralding what is deemed as crypto's breakthrough on the institutional stage.

According to Bloomberg, the expected green signal from the US Securities and Exchange Commission (SEC) for these ETFs is fuelling a fresh hype cycle, with industry insiders eyeing a potential $100 billion market.

The regulatory pendulum, once a hindrance, is now swinging favourably, paving the way for institutional and retail investors to delve into the digital currency space.

As the SEC gears up to potentially approve Bitcoin ETFs by mid-January or sooner, the move is seen as a redemption opportunity for digital asset proponents. The involvement of heavyweight players like BlackRock, Fidelity, and Invesco is likely to contribute to the growth of the spot-Bitcoin ETF market.

Bloomberg Intelligence estimates suggest that, with these reputable players on board, the market has the potential to evolve into a $100 billion juggernaut over time.

expressed his confidence in the imminent SEC approval, Jeff Janson, a wealth adviser managing about $550 million,&nbsp;told Bloomberg: "I feel like we are now staring down the gun barrel of the SEC finally delivering approval."

He anticipates significant institutional-level interest once Bitcoin is accessible through the ETF wrapper. This sentiment aligns with the bullish outlook that the involvement of major institutions can transform the digital asset landscape.

However, despite the optimism surrounding the Bitcoin ETFs, the aftermath of the FTX implosion continues to cast a shadow on the crypto market. The shockwaves from the industry's largest existential crisis have restrained interest, especially from everyday investors.

Bitcoin, despite recent rallies, has not yet reached its 2021 high, and notable figures in finance, like hedge fund manager Paul Tudor Jones, have maintained a low profile on digital assets. Scam incidents, false claims, and market volatility have added complexities to the narrative of crypto's integration into traditional finance.

According to Chuck Cumello, president and CEO of Essex Financial Services, Bitcoin ETF would simplify trading and make it more accessible for clients. The ETF's introduction is viewed as a significant development, offering a direct and supervision-friendly method for institutions to include crypto investments in their portfolios. The ETF's appeal extends to both millennial investors and high-net-worth individuals.

Laila Pence, founder of Pence Wealth Management, offers a word of caution, highlighting the waning interest in digital assets among younger clients. She points out the solid performance of traditional markets, questioning the necessity of taking risks in the crypto space when more conventional options are considered safer. Pence's perspective underscores the diverse opinions within the financial advisory landscape regarding the adoption and potential risks associated with cryptocurrency.

To some, the introduction of Bitcoin ETFs is more than a market opportunity; it symbolises the normalisation of a once-discredited asset class. The transparency and liquidity offered by the ETF structure are seen as a compliance-friendly avenue for institutional players, potentially unlocking fresh lending and derivatives trades. Coinbase emphasises that the ETF represents more than immediate inflows, predicting it could reshape the market in entirely unprecedented ways, albeit over time.

(With inputs from Bloomberg)

WATCH WION LIVE HERE

<iframe allow="accelerometer; autoplay; encrypted-media; gyroscope; picture-in-picture" allowfullscreen="" frameborder="0" height="350" src="https://www.wionews.com/live-tv/embed?autoplay=1&amp;mute=1" width="100%"></iframe>

Anticipation is building on Wall Street as the arrival of Bitcoin exchange-traded funds (ETFs) looms, heralding what is deemed as crypto's breakthrough on the institutional stage.

Anticipation is building on Wall Street as the arrival of Bitcoin exchange-traded funds (ETFs) looms, heralding what is deemed as crypto's breakthrough on the institutional stage. According to Bloomberg, the expected green signal from the US Securities and Exchange Commission (SEC) for these ETFs is fuelling a fresh hype cycle, with industry insiders eyeing a potential $100 billion market. The regulatory pendulum, once a hindrance, is now swinging favourably, paving the way for institutional and retail investors to delve into the digital currency space. As the SEC gears up to potentially approve Bitcoin ETFs by mid-January or sooner, the move is seen as a redemption opportunity for digital asset proponents. The involvement of heavyweight players like BlackRock, Fidelity, and Invesco is likely to contribute to the growth of the spot-Bitcoin ETF market. Bloomberg Intelligence estimates suggest that, with these reputable players on board, the market has the potential to evolve into a $100 billion juggernaut over time. expressed his confidence in the imminent SEC approval, Jeff Janson, a wealth adviser managing about $550 million, told Bloomberg: "I feel like we are now staring down the gun barrel of the SEC finally delivering approval." He anticipates significant institutional-level interest once Bitcoin is accessible through the ETF wrapper. This sentiment aligns with the bullish outlook that the involvement of major institutions can transform the digital asset landscape. However, despite the optimism surrounding the Bitcoin ETFs, the aftermath of the FTX implosion continues to cast a shadow on the crypto market. The shockwaves from the industry's largest existential crisis have restrained interest, especially from everyday investors. Bitcoin, despite recent rallies, has not yet reached its 2021 high, and notable figures in finance, like hedge fund manager Paul Tudor Jones, have maintained a low profile on digital assets. Scam incidents, false claims, and market volatility have added complexities to the narrative of crypto's integration into traditional finance. According to Chuck Cumello, president and CEO of Essex Financial Services, Bitcoin ETF would simplify trading and make it more accessible for clients. The ETF's introduction is viewed as a significant development, offering a direct and supervision-friendly method for institutions to include crypto investments in their portfolios. The ETF's appeal extends to both millennial investors and high-net-worth individuals. Laila Pence, founder of Pence Wealth Management, offers a word of caution, highlighting the waning interest in digital assets among younger clients. She points out the solid performance of traditional markets, questioning the necessity of taking risks in the crypto space when more conventional options are considered safer. Pence's perspective underscores the diverse opinions within the financial advisory landscape regarding the adoption and potential risks associated with cryptocurrency. To some, the introduction of Bitcoin ETFs is more than a market opportunity; it symbolises the normalisation of a once-discredited asset class. The transparency and liquidity offered by the ETF structure are seen as a compliance-friendly avenue for institutional players, potentially unlocking fresh lending and derivatives trades. Coinbase emphasises that the ETF represents more than immediate inflows, predicting it could reshape the market in entirely unprecedented ways, albeit over time. (With inputs from Bloomberg) WATCH WION LIVE HERE

Wall Street awaits $100 bn crypto boom with Bitcoin ETFs: Report

Libertarian Javier Milei's victory in the presidential elections is leaving a huge impact on Argentina's markets. argentina's black market peso fell 12% on Tuesday to 1,045 per dollar, on the first trading day after he won the election. on the other hand, stocks and bonds jumped in hopes of a more market-friendly policy.

Argentina: All eyes on Milei's new plans | World Business Watch

Javier Milei's dollarisation gets first test as Argentine banks reopen. As soon as Javier Milei took office as president-elect of Argentina, investors welcomed him with open arms. stocks on Wall Street rose to levels not seen in at least a decade, while bond prices rose on hopes that he might rescue the faltering economy.

Argentine markets soar on Dollarisation announcement | World Business Watch

The US Securities and Exchange Commission (SEC) has significantly ramped up its investigation into the utilisation of private messaging apps by leading investment firms. In its role of enforcing record-keeping regulations, the SEC has amassed a trove of thousands of internal staff messages from more than a dozen prominent financial companies.

Wall street's communication faces US regulator's investigation

Despite mounting evidence that the US economy may escape a recession — strategists generally foresee a market slump in 2024. The pessimism on Wall Street presents a predicament for investors with capital at risk. Despite the Fed's best efforts, inflation remains an economic concern.

Challenges and opportunities for investors in 2023

Looks like Asia Pacific markets are on a rise, tracking moves on the Wall Street as US market snapped a three-day losing streak on Monday. Overnight in the United States the gains added 0.62%.

Asian markets snap losing streak | US markets continue bull run | World Business Watch

LIBOR, the more than 50-year-old reference rate that came to epitomize Wall Street malfeasance, will soon be no more. SOFR, or secured overnight financing rate, a benchmark interest rate for Dollar-dominated derivatives & loans, is slowly taking its place.

LIBOR fades into history after 50 years of benchmark dominance

In some good news (finally) for the financial industry, the annual stress test conducted by the Federal Reserve shows that Wall Street's 23 larges&nbsp;banks are well-prepared to withstand severe economic downturns and real estate market instability, Bloomberg reported.

The stress test examines various economic scenarios and helps determine the value of funds banks must set aside as a financial cushion. Despite concerns over new capital requirements and regulatory changes, the results affirm the overall strength and capitalization of the banking industry.&nbsp;Notably, this year's criteria were established prior to the regional bank turmoil that occurred in March.

The annual stress test holds significant importance within the financial industry, as passing scores allow banking giants to return substantial amounts of money to their investors. However, it is expected that the results this year may take time to lead to dividend and buyback announcements, as many banks have expressed the need for clarity on new capital requirements that have been under discussion for several years. The Federal Reserve said that banks could start revealing their payout plans on Friday, but it is also considering overhauling its supervision efforts, Bloomberg reported.

Nonetheless, the stress test results reinforce claims that the banking industry remains robust and well-capitalized. Bloomberg quoted prominent bank executives, including Jamie Dimon, the CEO of JPMorgan Chase &amp; Co., as saying that increasing the mandatory reserve amounts would negatively impact lending. This year's hypothetical scenario involved:

<ul>
	<li dir="ltr">
	A surge in the U.S. unemployment rate to 10%.
	</li>
	<li dir="ltr">
	A 40% plunge in commercial real estate prices.
	</li>
	<li dir="ltr">
	A significant strengthening of the U.S. dollar against major currencies.
	</li>
</ul>

Additionally, the eight largest U.S. banks faced an exploratory market shock to their trading books for the first time, testing their resilience against greater inflationary pressures and rising interest rates.

According to Michael Barr, the Fed's vice chair for supervision,&nbsp;the stress test is a valuable measure of strength. But he adds that it is essential to remain cautious regarding potential risks and continue efforts to ensure the resilience of banks in various economic scenarios and market shocks.

The additional shock component introduced in this year's stress test will not affect capital requirements directly. Still, it will aid regulators in understanding trading risks and preparing for testing banks against multiple scenarios in the future. The Fed stated that 'the largest banks trading books were resilient to the rising rate environment tested.' This outcome serves as a reassuring response to concerns following recent bank failures.

Late trading saw shares of major banks, including JPMorgan, Wells Fargo &amp; Co., and Goldman Sachs, experience a rise in value. However, some voices cited by Bloomberg, such as Dennis Kelleher from Better Markets, a Washington-based group advocating for stricter financial rules, argued that urgent changes to the stress test format are necessary. They believe the 2023 exams failed to fully capture the extent of risk within the banking system.

(With Inputs from Bloomberg)

In some good news (finally) for the financial industry, the annual stress test conducted by the Federal Reserve shows that Wall Street's 23 larges banks are well-prepared to withstand severe economic downturns and real estate market instability, Bloomberg reported.

In some good news (finally) for the financial industry, the annual stress test conducted by the Federal Reserve shows that Wall Street's 23 larges banks are well-prepared to withstand severe economic downturns and real estate market instability, Bloomberg reported. The stress test examines various economic scenarios and helps determine the value of funds banks must set aside as a financial cushion. Despite concerns over new capital requirements and regulatory changes, the results affirm the overall strength and capitalization of the banking industry. Notably, this year's criteria were established prior to the regional bank turmoil that occurred in March. The annual stress test holds significant importance within the financial industry, as passing scores allow banking giants to return substantial amounts of money to their investors. However, it is expected that the results this year may take time to lead to dividend and buyback announcements, as many banks have expressed the need for clarity on new capital requirements that have been under discussion for several years. The Federal Reserve said that banks could start revealing their payout plans on Friday, but it is also considering overhauling its supervision efforts, Bloomberg reported. Nonetheless, the stress test results reinforce claims that the banking industry remains robust and well-capitalized. Bloomberg quoted prominent bank executives, including Jamie Dimon, the CEO of JPMorgan Chase & Co., as saying that increasing the mandatory reserve amounts would negatively impact lending. This year's hypothetical scenario involved: A surge in the U.S. unemployment rate to 10%. A 40% plunge in commercial real estate prices. A significant strengthening of the U.S. dollar against major currencies. Additionally, the eight largest U.S. banks faced an exploratory market shock to their trading books for the first time, testing their resilience against greater inflationary pressures and rising interest rates. According to Michael Barr, the Fed's vice chair for supervision, the stress test is a valuable measure of strength. But he adds that it is essential to remain cautious regarding potential risks and continue efforts to ensure the resilience of banks in various economic scenarios and market shocks. The additional shock component introduced in this year's stress test will not affect capital requirements directly. Still, it will aid regulators in understanding trading risks and preparing for testing banks against multiple scenarios in the future. The Fed stated that 'the largest banks trading books were resilient to the rising rate environment tested.' This outcome serves as a reassuring response to concerns following recent bank failures. Late trading saw shares of major banks, including JPMorgan, Wells Fargo & Co., and Goldman Sachs, experience a rise in value. However, some voices cited by Bloomberg, such as Dennis Kelleher from Better Markets, a Washington-based group advocating for stricter financial rules, argued that urgent changes to the stress test format are necessary. They believe the 2023 exams failed to fully capture the extent of risk within the banking system. (With Inputs from Bloomberg)

Dollars of Confidence: Wall Street heavyweights pass Stress Test, clear payout doubts

Before the Bank of Japan's expected raid decision later in the day, the Asian markets appear to be having a mixed trading session. According to Bank of America, neither rates nor the yield curve control policies of the Bank of Japan are expected to change. After outperforming all other markets, the Nikkei 225 is currently down about 1% and is expected to continue its downward trend for another day.

Wall St. stocks rise over risk-on sentiment

China's economic trajectory has recently garnered attention and raised concerns in financial markets. Expectations of a robust post-COVID rebound have largely failed to materialise, leading to increased scrutiny from analysts.&nbsp;

While Wall Street has adopted a short-sighted perspective, some experts argue that the bigger picture should be considered.&nbsp;

Despite growth acceleration in the first quarter of 2023, more recent data, as reported by Business Insider, indicates signs of a slowdown in various sectors, leading to revised growth estimates for the year.&nbsp;

As worries about China's economy reverberate through global markets, analysts emphasize the need for a long-term outlook to comprehend the situation fully.

China's economy experienced an acceleration to 4.5 percent growth in the first quarter, building on the relaxation of COVID-19 restrictions in late 2021. However, recent data indicate a deceleration in growth, with declines in retail sales, home sales, industrial production, and fixed-asset investment. Disappointed investors, hopeful for a stronger rebound, prompted Wall Street to revise their growth estimates for the year.

This downward trend has had a ripple effect across markets, as evidenced by the fall of the yuan below the psychologically important level of 7 per dollar earlier this month. Additionally, the price of copper, which was expected to benefit from high demand in Chinese factories, experienced a four-month low in mid-May. Luxury brands dependent on the Chinese consumer base also suffered declines in their share prices.

Short-Term Metrics vs. Long-Term Outlook

Analysts argue that unrealistic expectations and a preference for immediate metrics over long-term perspectives influence Wall Street's reaction to China's economic performance.&nbsp;

Some experts recall China's response to the 2008 financial crisis, where massive stimulus led to double-digit growth. However, this approach resulted in a significant debt burden that has since been a focus for the Chinese government.&nbsp;

While demand is slowing, China remains determined to limit debt growth while ensuring steady economic expansion. The government set a conservative growth target of 5 percent in March, which experts consider achievable.&nbsp;

Though full-scale stimulus measures are not expected, China possesses various tools to maintain growth. These measures include providing cheap loans to sectors in need, increasing lending quotas for policy banks, and easing financial conditions later in the year.

Despite China's efforts to manage its economy, challenges persist. Youth unemployment rates remain high, and geopolitical risks may hinder access to foreign technology.&nbsp;

Private investment, a key driver of growth in China, has nearly collapsed over the past 15 months, which some attribute to stringent regulations and an expanding role of the state in the market. However, several analysts maintain that China has the capacity to tackle these challenges and maintain steady growth.&nbsp;

China's economic trajectory has recently garnered attention and raised concerns in financial markets. Expectations of a robust post-COVID rebound have largely failed to materialise, leading to increased scrutiny from analysts.

China's economic trajectory has recently garnered attention and raised concerns in financial markets. Expectations of a robust post-COVID rebound have largely failed to materialise, leading to increased scrutiny from analysts. While Wall Street has adopted a short-sighted perspective, some experts argue that the bigger picture should be considered. Despite growth acceleration in the first quarter of 2023, more recent data, as reported by Business Insider, indicates signs of a slowdown in various sectors, leading to revised growth estimates for the year. As worries about China's economy reverberate through global markets, analysts emphasize the need for a long-term outlook to comprehend the situation fully. China's economy experienced an acceleration to 4.5 percent growth in the first quarter, building on the relaxation of COVID-19 restrictions in late 2021. However, recent data indicate a deceleration in growth, with declines in retail sales, home sales, industrial production, and fixed-asset investment. Disappointed investors, hopeful for a stronger rebound, prompted Wall Street to revise their growth estimates for the year. This downward trend has had a ripple effect across markets, as evidenced by the fall of the yuan below the psychologically important level of 7 per dollar earlier this month. Additionally, the price of copper, which was expected to benefit from high demand in Chinese factories, experienced a four-month low in mid-May. Luxury brands dependent on the Chinese consumer base also suffered declines in their share prices. Short-Term Metrics vs. Long-Term Outlook Analysts argue that unrealistic expectations and a preference for immediate metrics over long-term perspectives influence Wall Street's reaction to China's economic performance. Some experts recall China's response to the 2008 financial crisis, where massive stimulus led to double-digit growth. However, this approach resulted in a significant debt burden that has since been a focus for the Chinese government. While demand is slowing, China remains determined to limit debt growth while ensuring steady economic expansion. The government set a conservative growth target of 5 percent in March, which experts consider achievable. Though full-scale stimulus measures are not expected, China possesses various tools to maintain growth. These measures include providing cheap loans to sectors in need, increasing lending quotas for policy banks, and easing financial conditions later in the year. Despite China's efforts to manage its economy, challenges persist. Youth unemployment rates remain high, and geopolitical risks may hinder access to foreign technology. Private investment, a key driver of growth in China, has nearly collapsed over the past 15 months, which some attribute to stringent regulations and an expanding role of the state in the market. However, several analysts maintain that China has the capacity to tackle these challenges and maintain steady growth.

The great Wall Street mystery: Unraveling China’s economic puzzle

An economic recession in the US soon? Well, the Wall Street believes that recession has already arrived.

US corporate earnings are experiencing what might become the worst prolonged drop in the last seven years. This comes at a time when the US economy teeters on the verge of disaster as the stalemate over hiking the debt limit continues. As the first quarter earnings season winds down, analysts predict that S&amp;P500 company profits fell 3.7 percent year-over-year.&nbsp;

Data provided by Bloomberg reveals that 78 percent of companies beat projections.But that is less spectacular than it seems because analysts lowered their expectations before the season began.

Importantly, it was corporate America's second consecutive quarter of fall in profit. The S&amp;P500 index has posted no gains since major Wall Street lenders kicked off the earnings season in mid-April. Bloomberg Intelligence predicts a further 7.3 percent drop in profit in April–June.

Analysts have further downgraded their estimates. They now expect higher rates and waning consumer demand to hurt profitability beyond the third quarter of this year. This shows a lengthier profit recession than during the Covid-19 pandemic.

During 2015–2016, when the US Federal Reserve launched its previous rate hike cycle, profits fell for more than three quarters.&nbsp;

(With agency inputs)&nbsp;

An economic recession in the US soon? Well, the Wall Street believes that recession has already arrived. US corporate earnings are experiencing what might become the worst prolonged drop in the last seven years.

An economic recession in the US soon? Well, the Wall Street believes that recession has already arrived. US corporate earnings are experiencing what might become the worst prolonged drop in the last seven years. This comes at a time when the US economy teeters on the verge of disaster as the stalemate over hiking the debt limit continues. As the first quarter earnings season winds down, analysts predict that S&P500 company profits fell 3.7 percent year-over-year. Data provided by Bloomberg reveals that 78 percent of companies beat projections.But that is less spectacular than it seems because analysts lowered their expectations before the season began. Importantly, it was corporate America's second consecutive quarter of fall in profit. The S&P500 index has posted no gains since major Wall Street lenders kicked off the earnings season in mid-April. Bloomberg Intelligence predicts a further 7.3 percent drop in profit in April–June. Analysts have further downgraded their estimates. They now expect higher rates and waning consumer demand to hurt profitability beyond the third quarter of this year. This shows a lengthier profit recession than during the Covid-19 pandemic. During 2015–2016, when the US Federal Reserve launched its previous rate hike cycle, profits fell for more than three quarters. (With agency inputs)

United States already in a recession? Yes, the Wall Street feels so

Wall Street's three major stock indexes closed lower on Thursday, with bank stocks creating the biggest drag while investors also worried that Friday's jobs report could spur more aggressive interest rate hikes from the Federal Reserve.

Wall Street falls on bank stocks tumble, jobs report jitters

The Silicon Valley Bank (SVB), one of the leading lenders in the United States has sparked a wave of panic in the country and brought down banking shares across the world. The development comes as the SVB announced a share sale to shore up its finances, but the plan did not go well on the Wall Street as investors went on a sell-off spree, triggering a crash in its shares. 
 
As concerns over the bank's financial position spooked the market, a person familiar with the matter said Greg Becker, the SVB Financial Group Chief Executive Officer held a conference call around 11:30 am with the bank's advising clients including its venture and capital investors for 10 minutes and urged them to 'stay calm' and to support the bank like they had been doing for the past 40 years. Now to understand what happened with one of the US's oldest lenders, it's important to look at why did it happen and what's next. Here's everything you need to know:

When and how did the crisis begin?

As per Google Finance, SVB's stock fell 60 per cent ($106.04) on Thursday and its bond posted record declines.

Back in 2021, the bank saw a massive influx in its deposits which jumped from $61.67 billion to almost $189.20 billion. As its deposits grew, it failed to generate its loan book fast enough to generate the yield it wanted to see on the deposited capital. To tackle this, the bank purchased a large mortgage-backed security (MBS) worth $80 billion for its hold-to-maturity (HTM) portfolio. Over 95 per cent of these MBS were for over 10 years, with an average yield of 1.56 per cent.&nbsp;

However, with the rise in Fed rates, the value of SVB's MBS decreased, as the customers could buy "risk free" bonds from the Fed at a 2.5x higher yield, meaning,&nbsp;with the rising value of the Fed, the value of existing bonds fell.&nbsp;

Who are the SVB's clients?

The United States' leading lender is deeply connected to startups, as its focuses on trade in Silicon Valley and tech startups only.&nbsp;

As per the bank's website, it does business with over 50 per cent of all US venture capital-backed startups and almost 45 per cent of US venture-backed tech and healthcare companies.

The SVB announced that it had sold $21 billion of its Available For Sale (AFS) securities at a $1.8 billion loss and was raising another $2.5 billion in equity and debt.&nbsp;

This came as a surprise for its investors, who thought that the bank won't sell its AFS securities. Prominent venture capitalists advised businesses and startups to withdraw their money from the bank.&nbsp;

According to Bloomberg, a high-profile VC firm, Founders Fund, asked its portfolio companies to move their money. Union Square Ventures and Founder Collective also advised their portfolio companies to pull their funds from the bank.&nbsp;

What could happen next?

With the ongoing crisis at the SVB, analysts have raised their respective concerns.

According to a founding engineer at Glean, Debarghya Das if tech companies and startups continue to pull their money out of the bank, the SVB might go bankrupt, and tech companies would be wiped out, raising the chances of recession. &nbsp;

The Silicon Valley Bank (SVB), one of the leading lenders in the United States has sparked a wave of panic in the country and brought down banking shares across the world.

The Silicon Valley Bank (SVB), one of the leading lenders in the United States has sparked a wave of panic in the country and brought down banking shares across the world. The development comes as the SVB announced a share sale to shore up its finances, but the plan did not go well on the Wall Street as investors went on a sell-off spree, triggering a crash in its shares. As concerns over the bank's financial position spooked the market, a person familiar with the matter said Greg Becker, the SVB Financial Group Chief Executive Officer held a conference call around 11:30 am with the bank's advising clients including its venture and capital investors for 10 minutes and urged them to 'stay calm' and to support the bank like they had been doing for the past 40 years. Now to understand what happened with one of the US's oldest lenders, it's important to look at why did it happen and what's next. Here's everything you need to know: When and how did the crisis begin? As per Google Finance, SVB's stock fell 60 per cent ($106.04) on Thursday and its bond posted record declines. Back in 2021, the bank saw a massive influx in its deposits which jumped from $61.67 billion to almost $189.20 billion. As its deposits grew, it failed to generate its loan book fast enough to generate the yield it wanted to see on the deposited capital. To tackle this, the bank purchased a large mortgage-backed security (MBS) worth $80 billion for its hold-to-maturity (HTM) portfolio. Over 95 per cent of these MBS were for over 10 years, with an average yield of 1.56 per cent. However, with the rise in Fed rates, the value of SVB's MBS decreased, as the customers could buy "risk free" bonds from the Fed at a 2.5x higher yield, meaning, with the rising value of the Fed, the value of existing bonds fell. Who are the SVB's clients? The United States' leading lender is deeply connected to startups, as its focuses on trade in Silicon Valley and tech startups only. As per the bank's website, it does business with over 50 per cent of all US venture capital-backed startups and almost 45 per cent of US venture-backed tech and healthcare companies. The SVB announced that it had sold $21 billion of its Available For Sale (AFS) securities at a $1.8 billion loss and was raising another $2.5 billion in equity and debt. This came as a surprise for its investors, who thought that the bank won't sell its AFS securities. Prominent venture capitalists advised businesses and startups to withdraw their money from the bank. According to Bloomberg, a high-profile VC firm, Founders Fund, asked its portfolio companies to move their money. Union Square Ventures and Founder Collective also advised their portfolio companies to pull their funds from the bank. What could happen next? With the ongoing crisis at the SVB, analysts have raised their respective concerns. According to a founding engineer at Glean, Debarghya Das if tech companies and startups continue to pull their money out of the bank, the SVB might go bankrupt, and tech companies would be wiped out, raising the chances of recession.

Silicon Valley Bank crisis: What led to stock crash & what's next. Here's everything you need to know

A glitch at NYSE prevented opening auctions for its sleeve of stocks, there was a confusion for a long time over whether orders were being filled at correct prices and more than 250 securities was being busted. The glitch also impacted stocks of major companies.

World Business Watch: NYSE glitch briefly halts trading, stocks of major companies impacted

Tech giant Microsoft has posted results showing some strength in face of weak economy, it has posted fiscal second quarter earnings that exceeds Wall Street's estimates, however, Microsoft has also warned expectations may be missed in the current quarter.

World Business Watch: Microsoft offers lacklusture guidance; Q2 earnings exceed Wall St's estimates

US production and retail sales have plunged and this has added to fears that the world's largest economy may already be in recession and these risks have knocked the global financial markets Wall Street stocks took a bit of a beating after weak economic data.

World Business Watch: Is the US economy in recession already?

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