News of the day for June 24, 2024
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The European Commission has charged Apple (AAPL) with breaching its Digital Markets Act; Nvidia (NVDA) shares are extending their declines from late last week as Chief Executive Officer (CEO) Jensen Huang sells stock in the artificial intelligence (AI) darling; Broadcom (AVGO) is reportedly in talks with ByteDance, TikTok’s Chinese parent, to produce an advanced AI chip amid escalating geopolitical tensions with the U.S.; bitcoin (BTCUSD) is trading around $61,000 and dragging crypto-related shares like Robinhood Markets (HOOD), Coinbase Global (COIN), Marathon Digital Holdings (MARA), and Riot Platforms (RIOT); and China reportedly has told Germany the European nation’s luxury car manufacturers could benefit if Berlin convinces the European Union (EU) to drop tariffs on Chinese electric vehicle (EV) exports. U.S. stock futures are rising to start a week that follows one where the S&P 500 briefly hit the 5500 mark and Nvidia had a short-lived stint as world’s most valuable company. Here’s what investors need to know today.
1. Apple Faces EU Charge for Breaching Digital Markets Act
Apple’s (AAPL) App Store rules are preventing app developers from “freely steering consumers” to other channels, the European Commission said, charging the iPhone maker with breaching its recently implemented technology law. The Commission said that in its preliminary view, Apple had violated its sweeping new Digital Markets Act law. Apple is the first company to be charged for failing to comply with the new law, aimed at opening up tech firms’ business to broader competition. Separately, The Wall Street Journal reported that Apple, which has lagged in the AI race, has held talks with rival Meta Platforms (META) about integrating the Facebook parent’s generative AI model into Apple Intelligence, the iPhone maker’s new system for the technology. Apple shares are little changed in premarket trading, while those of Meta are up less than 1%.
2. Nvidia Falls Ahead of Shareholder Meeting as CEO Huang Sells Shares
Nvidia (NVDA) shares are falling further, down more than 2% in premarket trading, after the artificial intelligence (AI) star briefly overtook Microsoft (MSFT) as the world’s most valuable company last Tuesday. According to Securities and Exchange Commission (SEC) filings over the past couple weeks, CEO Jensen Huang has been selling stock in the company. Nvidia shares, which have surged 164% this year on the wave of investor enthusiasm for all things AI, will be in focus this week ahead of its annual shareholder meeting on Wednesday. The chip designer is also reportedly supplying Middle Eastern telecommunications giant Ooredoo with its technology.
3. Broadcom Reportedly in Talks With ByteDance to Build Advanced AI Chip
Broadcom (AVGO) is reportedly in talks with ByteDance, TikTok’s Chinese parent, to produce an advanced AI chip, an unusual tie-up at a time when the U.S. is trying to limit China’s access to cutting-edge semiconductors. Taiwanese semiconductor maker Taiwan Semiconductor Manufacturing Company (TSM) will produce the 5 nm chip, which would be compliant with U.S. export restrictions, according to Reuters, which reported the negotiations. Broadcom already supplies ByteDance’s data centers with an older-generation AI processor. Broadcom shares are little changed in premarket trading.
4. Bitcoin Keeps Dropping, Drags Robinhood, Coinbase
Bitcoin (BTCUSD) continues to fall and is now trading around $61,000, well off the record of more than $73,000 set in March, after the SEC’s approval of ETFs based on the cryptocurrency turbocharged demand. Bitcoin has continued to lose ground even as cooler-than-expected inflation data has generally buoyed stocks. Bitcoin’s decline is weighing on cryptocurrency-tied stocks, with trading app Robinhood Markets (HOOD) falling 1.3% in premarket trading and cryptocurrency exchange Coinbase Global (COIN) declining 3%. Bitcoin miners Marathon Digital Holdings (MARA) and Riot Platforms (RIOT) are also falling about 3% each.
5. China Suggests German Cars Could Benefit as Beijing Moves to Stop EV Tariff Hike
China has told Germany the European nation’s luxury car manufacturers could benefit if Berlin convinces the European Union (EU) to drop tariffs on Chinese electric vehicle (EV) exports, Bloomberg reported. The EU announced plans to impose tariffs of up to 38.1% on imported Chinese EVs earlier this month, weeks after the U.S. said it would raise tariffs on Chinese EV imports to 100% from 25% this year. China currently imposes a 15% tariff on passenger vehicles from the EU and has suggested to Berlin it could lower its existing tariffs on large-engine cars in exchange for getting the European import levies scrapped, the report said.
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