PickAlpha Morning Report | 2025-12-29 — 5 material moves and analysis

• China launches Justice Mission 2025 encircling Taiwan 89 aircraft — $TSM, $UMC • Nvidia acquires 214 7M Intel shares for 5 0B — $NVDA, $INTC • Hong Kong private home prices rise 0 9 November — $EWH,

Scope: filtered material news only (passed significance tests).
Method: in-house deep network reasoning + causal graphs → asset mapping → actions.
Authorship: compiled from model outputs; edited & written by senior buy-side researchers.

PickAlpha - Macro Events:

2025-12-29 Events Analysis -

China launches largest-ever live-fire encirclement drills around Taiwan, testing blockade scenario | $TSM, $UMC, $EWT, $SMH, $ITA

Immediacy: Overnight · Impact: bearish · Category: EventRisk · Materiality: A (★★★, 90)

China’s Eastern Theatre Command has launched “Justice Mission 2025,” its largest encirclement drills around Taiwan by geographic coverage, deploying troops, warships, fighter jets and artillery in live-fire exercises explicitly framed as blockade rehearsals. Taiwan’s defence ministry reported 89 Chinese military aircraft, 14 navy vessels and 14 coast guard ships operating around the island on Monday, plus four additional warships in the western Pacific, with some vessels engaged in stand-offs near Taiwan’s 24-nautical-mile contiguous zone. China’s Maritime Safety Administration declared a record seven live-fire zones that effectively cut key air and sea routes and target deep-water ports at Keelung and Kaohsiung, forcing widespread flight reroutes around a roughly 10-hour “temporary danger zone.” The drills follow U.S. approval of an $11.1 billion arms package to Taiwan, including long-range systems such as HIMARS, underscoring rising cross-Strait escalation risk with direct implications for Taiwan-linked semiconductors, shipping lanes and regional defence equities, even as Taiwan’s stock market closed 0.9% higher on Monday and authorities placed forces on high alert and ran rapid-response drills.

Action — CAUTIOUSLY OBSERVE: Drill normalization and port access risk skew near-term downside for Taiwan semis and ADRs

The key variables are the frequency and normalization of PLA live-fire exercises and the duration and severity of disruptions at Keelung and Kaohsiung. Persistent or recurring blockade-style drills would extend shipping and air-route detours, raising logistics costs and elongating delivery times for Taiwan’s semiconductor supply chain, which could weigh on near-term revenues and earnings visibility for TSM, UMC and broader Taiwan ADRs, while supporting incremental defence spending and flows into ITA. For SMH, EWT and related semiconductor-linked ETFs, the upside comes from drills remaining short-lived and perceived as political theatre, allowing risk premia to compress and supply chains to normalize. The downside dominates if Beijing institutionalizes encirclement drills, driving sustained outflows and valuation de-rating on supply-chain and sanctions tail risks. A concrete trigger to watch is whether the current live-fire zones around Keelung and Kaohsiung are extended beyond the initial 10-hour window or reimposed in rapid succession, which would signal a shift toward semi-permanent coercive pressure.

Source: Reuters • Time: 2025-12-29T05:37:00-05:00

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Asian equities hit six-week highs as silver tops $80/oz and precious metals surge on Fed-cut bets | $GLD, $SLV, $GDX, $SPY, $UUP

Immediacy: Last Day · Impact: bullish · Category: Macro/Rates/FX · Materiality: B (★★, 85)

Asian equities hit six-week highs in Monday trade as investors rotated into risk assets and precious metals, with the U.S. dollar hovering near a three-month low and markets pricing further Federal Reserve rate cuts in 2026. Silver briefly spiked above $80 per ounce for the first time before reversing sharply, while platinum and palladium also pulled back after marking all-time highs. Gold eased intraday yet remains on track for its biggest annual gain since 1979, up more than 72% in 2025, underscoring the strength of the late-year move. Strategists attribute the parabolic price action to aggressive rate-cut expectations, demand for hedges against geopolitical and fiscal uncertainty, and mounting supply worries, particularly in silver, which has exhibited extreme short-term volatility. The cross-asset pattern reinforces a macro regime of lower real yields and a weaker dollar that favours hard-asset exposures, with direct implications for U.S.-listed metals ETFs, gold and silver miners, and broader commodity-linked equities across benchmarks such as GLD, SLV, GDX, and SPY versus dollar strength proxies like UUP.

Action — BUY ON DIPS: Priced-in 2026 Fed cuts, lower real yields and a weaker dollar favor metals and miners, but positioning is stretched and volatile, so accumulate selectively on intraday pullbacks with tight risk controls.

Lower real yields and a softer dollar, anchored by 2026 Fed-cut expectations, are channeling flows toward GLD, SLV, GDX and related commodity equities, while stretched positioning amplifies both upside and mean-reversion risk. The upside skew (UP > DOWN) rests on continued policy easing expectations and persistent supply concerns, which could extend the rally and support further inflows into metals-linked ETFs versus broad risk proxies like SPY and at the expense of dollar strength via UUP. Downside risks center on a hawkish shift in Fed communication, upside inflation surprises, or geopolitical de-escalation that sparks a dollar rebound and rapid profit-taking. On balance, the regime still supports adding hard-asset exposure, but only with disciplined entry points and tight risk limits. A concrete trigger to watch is the next Fed communication or dot-plot revision; affirmation of the current 2026 rate-cut path would likely validate further tactical dip-buying in precious metals and miners.

Source: Reuters • Time: 2025-12-28T20:55:00-05:00

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Hong Kong private home prices rise 0.9% MoM in November, extending housing rebound to six months | $EWH, $FXI, $HKGNY, $SPY, $VT

Immediacy: Overnight · Impact: bullish · Category: Macro/Rates/FX · Materiality: C (★, 75)

Hong Kong’s Rating and Valuation Department reported that private home prices rose 0.9% month‑on‑month in November, accelerating from a revised 0.4% gain in October and marking a sixth consecutive monthly increase. Prices are now up 2.8% year‑to‑date in 2025, tentatively reversing part of a nearly 30% peak‑to‑trough decline since 2021 that stemmed from higher mortgage rates, weak growth and professional outflows tied to strict COVID rules and national security laws. Authorities have scrapped most purchase curbs and relaxed down‑payment ratios, while major banks have delivered multiple mortgage‑rate cuts following U.S. Federal Reserve easing, gradually improving affordability and buyer sentiment. At the same time, developers are still selling new flats at discounts to clear inventory, which continues to pressure the secondary market even as headline indices stabilize, delaying earnings and balance‑sheet repair for highly levered Hong Kong property firms and making the current rebound uneven across segments.

Action — BUY ON DIPS: Policy easing and six months of price gains point to a tentative bottom for Hong Kong housing

Policy easing and mortgage‑rate cuts improve affordability and stimulate demand, which supports home prices, rental resilience and margin stabilization, setting up potential multiple expansion for Hong Kong‑focused REITs and U.S.‑listed ETFs such as EWH and FXI. As unsold inventory gradually clears and developer discounts narrow, higher headline prices could validate forecasts for roughly 5% additional recovery by end‑2026, improving cash flows and deleveraging capacity for property names, with spillovers to broader China‑exposure baskets and global ETFs like VT and, at the margin, SPY. However, persistent discounting or a renewed rise in mortgage rates would cap secondary prices, prolong weak earnings and keep balance‑sheet risk elevated. On balance, upside modestly outweighs downside, but the path is likely volatile; a concrete trigger would be evidence over coming quarters that primary‑market discounts are shrinking alongside sustained mid‑single‑digit price growth, confirming that demand is absorbing inventory rather than being purely policy‑driven.

Source: Reuters • Time: 2025-12-28T22:47:00-05:00

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Bangladesh jewellers lift gold prices to fresh record as global bullion hits new highs | $GC=F, $GLD, $GDX, $IAU, $SPY

Immediacy: Last Day · Impact: bullish · Category: Commodities/Supply · Materiality: C (★, 70)

The Bangladesh Jewellers Association announced a second consecutive gold price hike, lifting pure gold to a record Tk 229,430 per bhori (11.664 grams) from Tk 227,856, a Tk 1,574 or about 0.69% increase effective nationwide from Monday. The move follows further gains in the local bullion market, itself reacting to international gold benchmarks hitting repeated all‑time highs in 2025 on safe‑haven demand and expectations of additional U.S. Federal Reserve rate cuts. The BAJUS fixing illustrates how global bullion strength is increasingly transmitting into emerging‑market retail pricing, particularly across Asia, a core physical‑demand region, supporting margins for regional refiners and jewellery retailers even as record prices begin to test affordability for end‑customers. For global investors, the extension of the rally into downstream markets reinforces the breadth and durability of the current gold uptrend, with local price actions aligning with the bullish narrative in major benchmarks such as COMEX futures and U.S.‑listed gold vehicles.

Action — BUY ON DIPS: Record international and local prices validate a bullish thesis for miners and gold ETFs; buy on dips while monitoring physical demand and Fed signals.

The key driver is global bullion price levels, anchored by international benchmarks reacting to safe‑haven flows and Fed rate‑cut expectations; this strength passes through into local fixings, lifting realized prices and margins for the gold value chain and, by extension, supporting valuations for U.S.‑listed miners and ETFs such as GLD, IAU, and GDX. The counter‑force is local retail affordability: sustained high prices in Bangladesh and other Asian markets may curb physical demand or trigger scrap supply, moderating volume growth despite higher unit margins. With the trend assessment skewed UP > DOWN, the upside remains that further global price appreciation and dovish Fed signaling extend the rally in GC=F and gold‑linked equities, while the downside lies in a sharp pullback in benchmarks if macro risk appetite improves. A concrete trigger would be the next Fed communication that reinforces or challenges current rate‑cut expectations, driving the next leg in gold pricing and related assets, including relative performance versus SPY.

Source: The Daily Star / Reuters • Time: 2025-12-28T09:29:00-05:00

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PickAlpha - Company News:

2025-12-29 News Analysis:

Nvidia completes $5 billion strategic equity stake in Intel via private placement | $NVDA, $INTC, $SOXX, $SMH, $QQQ

Immediacy: Overnight · Impact: mixed · Category: CorpActions · Materiality: B (★★, 88)

Nvidia has completed a $5.0 billion strategic equity stake in Intel via a privately placed purchase of 214.7 million common shares at $23.28 per share, executing terms first outlined in September 2025. Intel disclosed the transaction in a Monday filing, noting that U.S. antitrust authorities cleared Nvidia’s minority investment earlier in December, removing a regulatory overhang that could have derailed or delayed the funding. The capital injection offers Intel a meaningful balance-sheet lifeline after years of heavy capex and execution missteps, while Nvidia secures financial exposure to a major foundry and x86 competitor without assuming control or integration risk. The negotiated price reflects a premium to Intel’s trough levels earlier in 2025 but a discount to recent strength in semiconductor equities, positioning the deal as both strategic and value-accretive for Nvidia and potentially supportive for market sentiment around the broader U.S. semiconductor complex.

Action — CAUTIOUSLY OBSERVE: Monitor Intel’s use of proceeds, execution improvement, and any manufacturing cooperation announcements; watch market reaction to NVDA, INTC and semiconductor ETFs before initiating positions.

From an investment perspective, the key variables are Intel’s funding runway and execution versus Nvidia’s capital allocation and minority exposure. The $5.0 billion cash placement directly extends Intel’s balance-sheet capacity, potentially easing near-term funding risk and enabling more consistent investment in manufacturing and advanced packaging, which could support a valuation re-rating if execution improves. For Nvidia, redeploying excess cash into a non-controlling stake slightly tilts its profile toward strategic equity ownership and may prompt investors to reassess NVDA’s multiple depending on perceived return on this capital. Upside emerges if Intel uses the proceeds to stabilize operations and later announces concrete cooperation with Nvidia on manufacturing or packaging, benefiting INTC and semiconductor ETFs such as SOXX, SMH, and QQQ. Downside risk is that Intel’s structural execution problems persist despite the cash, or markets interpret Nvidia’s move as suboptimal capital deployment, weighing on both NVDA and INTC and dragging the broader semiconductor trade lower. A clear trigger to reassess positioning would be Intel’s next detailed capital-allocation and execution update, including any disclosed joint projects with Nvidia tied to this investment.

Source: Reuters • Time: 2025-12-29T07:19:00-05:00

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Informational only; not investment advice. Sources deemed reliable.