In today’s top stories, Xpeng follows Tesla in slashing its vehicle prices, Alibaba gets the meme stock treatment, and Microsoft says it’s adding ChatGPT to its cloud service. Neal Berger, whose fund rose 163% in 2023, shares his advice, and cryptocurrencies rally again.
Xpeng cuts prices to rival Tesla
Chinese EV maker Xpeng [XPEV] is dropping prices by approximately 10%. The move is likely in reaction to Tesla [TSLA] reducing Model 3 and Model Y prices, which led to a 15% drop in the Xpeng share price on 6 January. Citigroup analyst Jeff Chung said in a note seen by Automotive News Europe that Xpeng would “suffer the most” from Tesla’s cuts. Buffett-backed BYD [1211.HK] aims to start selling electric SUVs in the UK from this quarter.
Meme stock investor targets Alibaba
Ryan Cohen has a new target: Alibaba [BABA]. The meme stock investor, better known for his big bets on Bed Bath & Beyond [BBBY] and GameStop [GME], has reportedly built up a stake in the Chinese ecommerce giant worth hundreds of millions of dollars, and is pushing the company to increase buybacks. “While Ryan is influential and the news is positive for BABA, it’s unlikely to have much sway with the board,” Hao Hong, an economist with Grow Investment, told Bloomberg.
Microsoft to add ChatGPT to cloud services
Microsoft [MSFT] has announced it is to integrate the AI-powered language optimisation tool ChatGPT into its Azure cloud service, which will “help customers apply the world’s most advanced AI models to their own business imperatives,” according to CEO Satya Nadella. News that Microsoft plans to take a stake in ChatGPT’s owner OpenAI is also a sign that the tech giant is “being aggressive and not going to be left behind on game-changing AI investment,” tweeted Wedbush analyst Dan Ives.
Veteran investor’s fund rallies 163% in 2022
Last year was a bloodbath for equity investors, but Neal Berger, founder of Eagle’s View Capital Management, navigated the bear market by using futures contracts to short stocks and bonds that were overvalued. The veteran hedge fund manager’s Contrarian Macro Fund returned 163% in 2022. The fund’s thesis is that “global central bank posture toward liquidity has changed 180 degrees from a liquidity infusion posture to a liquidity extraction posture,” Berger told CNBC.
Risk-on investing helps cryptocurrencies to rally
The crypto winter may not yet have thawed, but there are indications that the sector is on the road to recovery. Bitcoin [BTC-USD] has jumped 27.9% since the start of 2023 and 23% in the last week alone, putting it on track for its best month since October 2021. Ether [ETH-USD] is up 31.8% year-to-date. According to CoinGecko, the global crypto market has reached a value of $1trn. The rally can be attributed to more investors taking a risk-on approach to assets as inflation eases.