US Open: Wall Street starts a new week higher 📌

• Wall Street starts the new week on a positive note
• The dollar is noticeably weaker, with EURUSD rising by 0.45
• Amazon (AMZN.US) gained an additional 2.60% at the session's opening

The beginning of the new week brings a slight rebound on Wall Street. Investors are more optimistic after the Israeli offensive turned out to be less aggressive than initially expected. However, as the USA notes, the risk of conflict escalation and the involvement of other regional states is really high. Another reason for optimism seems to be the upcoming Federal Reserve decision, where maintaining the current interest rate level is almost certain. Moreover, investors are increasingly convinced that the cycle of rate hikes is already behind us.

The start of the session brings a lot of gains on the SP500 index. Leaders include Western Digital (WDC.US), Boston Properties (BSX.US), and AbbVie (ABBV.US). Amazon (AMZN.US) and Meta Platforms (META.US) are also gaining significantly.

Situation in the Israel-Hamas Conflict

The US government views the ongoing conflict between Israel and Hamas with concern, emphasizing the need for humanitarian aid in Gaza and the protection of civilians. President Biden, in a call with Israeli Prime Minister Netanyahu, stressed Israel's right to defend against terrorism but also highlighted the importance of adhering to international humanitarian law, prioritizing civilian safety. The US has not fully endorsed a ceasefire but supports "humanitarian pauses" to facilitate the safe release of hostages held by Hamas. The US successfully pressured Israel to restore communication services in Gaza, disrupted during the conflict, to aid coordination efforts by the United Nations and other groups. The conflict, marked by Israel's deep military incursion into Gaza, aims to dismantle Hamas's infrastructure and control, with Israeli forces focusing initially on Gaza City.

Company News

Amazon (AMZN.US), gaining 2.6% after recently published strong quarterly results. Amazon is innovating in the realm of advertising by introducing artificial intelligence (AI) services that enable sellers to create more engaging and visually appealing product images. This new AI tool, currently in beta, can transform basic product photos into more attractive "lifestyle" images, potentially increasing click-through rates by 40%. This initiative is part of Amazon's broader strategy to enhance its advertising segment, which has recently become the fastest-growing part of its business, generating significant revenue. While these advancements in AI and advertising are promising for Amazon's growth and profitability, there are slight concerns about the potential erosion of customer trust. This stems from the risk of misrepresenting product quality and seller integrity, further complicating the online shopping experience where physical examination of products isn't possible. However, Amazon disputes these concerns, focusing instead on the benefits and efficiencies brought by these AI tools.

Source: xStation 5

Frank Meng, chairman of Qualcomm China (QCOM.US), announced Qualcomm's intention to strengthen cooperation with Chinese partners in wireless communication, aiming for mutual benefits in the global market. He highlighted that over half of Qualcomm's global revenue is generated from the Chinese market. Meng expressed confidence in the resilience and long-term prospects of the Chinese economy and its smartphone market. Qualcomm plans to continue its close work with Chinese entities to further 5G deployment and has been a regular participant in the China International Import Expo since its inception.

ON Semiconductor's (ON.US) shares dropped 14% on Monday following a fourth-quarter forecast that fell short of expectations in terms of adjusted earnings and revenue, despite reporting solid third-quarter results. The stock is now 34% below its August peak, trading at its lowest since April. Analysts from William Blair, KeyBanc Capital Markets, Truist Securities, and Vital Knowledge noted the company's results were solid but the outlook was weaker than expected, likely due to softness in the industrial market. Third-quarter revenue was slightly down year-over-year at $2.18 billion, with adjusted EPS at $1.39 compared to last year's $1.45. The fourth-quarter forecast sees adjusted EPS between $1.13 and $1.27 and revenue between $1.95 billion and $2.05 billion, both below estimates.

Source: xStation 5