The YieldMax TSLA Option Income Strategy ETF (TSLY) will be in the spotlight this week after Tesla publishes its financial results. The fund has retreated by about 18% from its highest level this year and is hovering near its lowest point since December 4. So, is the TSLY ETF a good investment this year?
What is the TSLY ETF?
The TSLY ETF is one of the many single-stock funds that have come up in the past few years. Its goal is to expose its holders to a company and monthly dividend payouts.
Tesla does not pay a dividend since it is still in its growth phase. As such, income-focused investors allocate cash to TSLY to get some monthly payouts, which they can reinvest or use to pay bills.
Data shows that TSLY yields about 85%, much higher than most dividend companies pay. It achieves this by investing in Tesla shares and selling call options tied to the stock.
The idea behind a covered call ETF is simple in that it benefits when the stock rises and generates a monthly premium, which is then distributed to shareholders as a dividend.
A call option is a financial instrument that gives investors a right, but not the obligation, to buy an asset before an expiry. So, assume that a stock is trading at $10 and you have a call option. In this case, if it drops to $9, the call option becomes invalid since buying it in the open market is cheaper.
If the stock soars, then you benefit for buying it at a lower price. The risk, however, is where it surges and crosses the strike price. In this case, investors miss the opportunity of holding it for longer.
Tesla earnings preview
The main catalyst for the TSLT ETF this week will be the upcoming earnings scheduled on Wednesday. These numbers will provide more information about its performance and what to expect in the coming months.
Tesla’s deliveries have not been good as competition rose and demand for electric vehicles softened. It delivered 1.77 million vehicles in 2024, down from over 1.78 million a year earlier, the first time that its deliveries dropped.
The third-quarter results showed that its automotive revenue rose by 2% to $20 billion, while its energy generation storage and services jumped by 52% and 29%, respectively. Total revenue rose by 8% to $25.18 billion.
Tesla’s stock jumped after that report as the company outlined its robotaxi business and its hope for building cheaper vehicles. Investors also cheered the growth of its carbon credit business.
The 29 analysts tracked by Yahoo Finance have an average revenue estimate of $27 billion, a 7% increase from what it made in the same quarter in 2023. They also expect its annual revenue to be $100 billion, followed by $115 billion this year.
Read more: Why Tesla’s sales are expected to slow down in 2025
So, is TSLY ETF a good buy ahead of earnings?
People buy TSLY and similar funds mainly because of its substantial dividend yield. Therefore, TSLY is a good investment.
However, for investors considering the total return aspect, it makes sense to invest in TSLA instead of TSLY. History shows that TSLA always generates stronger returns than TSLY. For example, TSLA has jumped by 108% in the last 12 months, while TSLY is up by 56%.
This could change if the Tesla stock reverses this year. Having TSLY and benefiting from its monthly distributions would be ideal in such a period.
The middle ground of all this is to invest in both assets, with most of the cash being in TSLY and the rest in TSLA.
The post Is the TSLY ETF a better buy than TSLA stock ahead of earnings? appeared first on Invezz
The post Trump’s $500 billion AI initiative will benefit these 3 chip stocks other than Nvidia appeared first on Invezz
Small-cap stocks were broadly expected to benefit from deregulation and lower taxes under the Trump administration.
Both regulation and taxes tend to weigh more on the bottom-lines of smaller companies than they do on their larger counterparts. Still, small-cap stocks haven’t been able to do all that well in recent months.
However, things sure could change moving forward. According to Wolfe Research strategist Rob Ginsberg, the US small-cap stocks are strongly positioned for a significant rally ahead.
Why haven’t the small-cap stocks done well?
Investors have been wary of investing heavily in the US small-cap stocks primarily because it’s been ages since they succeeded in outperforming the large-cap names.
In fact, large-cap stocks have done significantly better than the small-cap stocks index in nine of the past 11 years. Last year, for example, the Russell 2000 returned just 10% versus well over 20% for the S&P 500.
Nonetheless, there’s reason to believe that this Trump trade has been getting ready for a meaningful run to the upside that may materialize over the next quarter or so, according to Ginsberg.
What signals a big move to the upside in small-cap stocks?
It hasn’t been all that long when small-cap stocks were struggling to pull out of the read.
At writing, however, the Russell 2000 has all of its sectors in the green over the past month, and now “further gains looking likely,” as per the Wolfe Research strategist.
“The index has carved out a compelling multiyear base after several years of choppy, range bound trading and struggles,” he added in a research note last week.
The small-cap index currently sits a little below a key resistance at the 2,450 level. A breakout could clear the path for “a massive run” in the group, Ginsberg argued in his report.
What interest rate cuts could mean for the Russell 2000
President Trump is broadly expected to favour policies that could lift the US economy in 2025. Some experts even see the GDP improving by as much as 5.0% this year.
That could also prove to be meaningful for small-cap companies as they drive a bigger chunk (up to 80%) of their revenue from the domestic market.
Finally, small-cap stocks are worth buying as the Fed is expected to cut interest rates further in 2025.
Why? Because smaller companies often have higher levels of debt. A decline in borrowing costs, therefore, helps free up their capital for growth.
Small-cap firms also rely more on external financing, the cost of obtaining which reduced when interest rates are cut.
All in all, these companies are more nimble and have more room for rapid growth compared to their larger counterparts.
Lower borrowing costs allow them to capitalise on growth opportunities more easily.
The post Here’s a Trump trade that hasn’t played out yet appeared first on Invezz
The DAX index surged to a record high this month, a trend that may continue this week ahead as its biggest constituent publishes its financial results and as the European Central Bank (ECB) publishes its interest rate decision. It soared to a high of €21,500, up by over 80% from its lowest level in 2022. So, is the DAX 40 index a good investment this year?
SAP earnings ahead
SAP, the biggest company in the DAX index, has been a key contributor to its recent surge. Its stock has just surged to a record high of €263.55, up by over 240% from its lowest level in 2022. This rally has brought its market cap to over €336 billion.
SAP’s growth happened because of its strong market share in the Enterprise Resource Planning (ERP) industry, where it offers its solutions to global companies. It has also become one of the top firms in the artificial intelligence industry.
SAP stock price will be in the spotlight this year as the firm releases its fourth-quarter results. The most recent numbers revealed that its cloud business continued thriving, with the cloud backlog surging by 25% to €15.4 billion.
SAP’s cloud revenue rose by 25%, while the cloud ERP Suite revenue soaring by 34%. Its revenue soared by 9% to over €8.4 billion, while the operating profit rose by 29% to €2.2 billion.
Therefore, analysts anticipate that SAP’s growth will continue in the fourth quarter, with its annual revenue expected to be $33.95 billion and its forward guidance for 2025 being $37.9 billion. These results will show the impact of its recent acquisition of WalkMe.
Strong SAP results will likely push the stock to more upside this week, positively impacting the DAX index.
The index will also react to earnings by other global companies that have an outsize impact on global equities. Some of the most notable names are Microsoft, Apple, and Meta Platforms.
The best-performing DAX index companies the year so far are big names like BASF, Siemens, Deutsche Bank, Commerzbank, Rheinmetall, Heidelberg Materials, and Siemens Energy.
Most of these companies will release their quarterly results in the next few weeks.
ECB and Fed decisions
Monetary policy decisions will be the next catalyst for the DAX index. The Federal Reserve will be the first important catalyst, providing more catalysts for US and European markets.
Economists expect the Fed to leave interest rates unchanged in this meeting and maintain its hawkish tone. That’s because the US labor market has started to improve while inflation remains significantly high. A highly hawkish Fed will likely lead to more weakness in global stocks, including the DAX index.
The ECB, on the other hand, is expected to slash interest rates by 0.25%. However, unlike in its other meetings, the bank will likely embrace a hawkish view because European countries have started to recover.
DAX index forecast
The weekly chart shows that the DAX 40 index has been in a strong bull run, making it one of the top-performing European indices. It has moved above the 50-week moving average. Also, the Relative Strength Index (RSI) and the Percentage Price Oscillator (PPO) have continued rising this year.
Therefore, the path of the least resistance is higher, with the next point to watch being at €22,000.
The post 3 key catalysts for the DAX index as it hits all-time high appeared first on Invezz
Transformers & Rectifiers India has emerged as a stock market marvel, delivering a jaw-dropping 11,725% return over the last five years.
From a modest ₹8 in 2018, the company’s shares have soared to ₹946, making it one of the most talked-about success stories in India’s industrial sector.
Investors who put ₹1 lakh into TRIL stock five years ago would now see their investment balloon to ₹1.18 crore.
The stock’s meteoric rise has not been a one-off rally. Over the past two years, TRIL shares have climbed 1,169%, jumping from ₹74.50 to ₹946.
The company’s ability to recover sharply from market corrections has made it a favourite among investors, with significant gains accruing after each dip.
TARIL’s performance fuelled by infrastructure boom
TRIL’s remarkable performance can be attributed to its growing order book, buoyed by India’s infrastructure push and the global uptick in energy projects.
The company, a major supplier of transformers to industries and utilities, has successfully capitalized on rising power demand and government capex plans.
The December-ended quarter saw TRIL securing new orders worth ₹631 crore, pushing its unexecuted order book to ₹3,686 crore.
The company also revealed ₹19,000 crore worth of inquiries under negotiation, signaling strong demand for its products in the coming quarters.
Revival in the transformer industry has further boosted TRIL’s fortunes.
With capacity expansions in power plants, large-scale renewable energy installations, and upgrades to transmission infrastructure, the sector has gained momentum after years of sluggish growth.
Diverse portfolio and specialised transformers expanding reach
TRIL’s diverse portfolio has played a key role in its expansion.
The company supplies transformers to power generation and distribution projects, railways, renewable energy plants, and industrial manufacturing units.
Beyond its stronghold in India, TRIL has expanded its presence internationally, exporting to markets across Asia, Africa, and the Middle East.
The company’s innovative approach to renewable energy has been particularly noteworthy.
With the growing adoption of renewable power sources, TRIL has developed specialized transformers to cater to this segment.
Its technical expertise and tailored solutions have helped it carve a niche in the rapidly evolving energy landscape.
The company is now aiming to increase export revenue contribution to 25% in two years.
Steady focus on operational efficiency
Alongside strong demand, TRIL has implemented strategies to streamline operations and enhance profitability.
The company is gradually moving toward full backward integration to reduce dependency on external suppliers for critical components.
This, combined with operational optimization and cost rationalization, has further strengthened its financial position.
By leveraging its technological advancements and tapping into emerging market opportunities, TRIL has demonstrated a formula for consistent growth in a competitive industry.
The company’s rise highlights the transformative impact of a clear strategy paired with strong market fundamentals.
TARIL share price outlook for 2025
Earlier in the month, analysts at Antique Broking and Nuvama maintained their “buy” rating on the stock.
Antique raised its price target on the stock from Rs 1,187 to Rs 1,424. The brokerage said that it expects the company to report exponential growth over the next three years, with revenue and PAT rising by 3.6x and 10x in FY27 from the base of FY24.
Nuvama also raised its 12-month target price to Rs 1,450 from Rs 980.
The post How this small-cap Indian stock surged more than 1,100% in two years: analysts see further upside appeared first on Invezz
France finds itself in a challenging economic and political situation that raises alarms for the rest of Europe.
With GDP growth forecast at just 0.6% for 2025 and a budget deficit projected to reach 6.1% in 2024, the country is under significant strain.
The government has introduced fiscal adjustments and regulatory changes, but are these measures enough to stabilize the economy, or does France need more profound reforms to truly turn things around?
How weak is the French economy?
The French economy has started 2025 on a sluggish note. Growth has been grinding to a near halt, with the fourth quarter of 2024 shrinking by -0.1% and only marginal improvement (0.1% growth) is expected in the first quarter of 2025.
According to research by ING, forecasts for the full year show GDP expanding by just 0.6%—a far cry from the 1.1% growth seen in previous years.
The business climate index remains stuck at 95, below its long-term average. In key sectors like industry and construction, order books are shrinking, making declining activity evident.
In fact, industry order books are at their lowest level since 2014, while the construction sector faces another challenging year as demand falters.
Even services are showing cracks. Real estate activities are holding steady, but almost all other sub-sectors are performing below average.
Meanwhile, household consumption is subdued despite falling inflation and rising real wages.
Instead of spending, many households are saving more due to fears about unemployment and economic uncertainty.
Why are public finances under pressure?
The nation’s budget deficit reached 6.1% of GDP in 2024, far above the EU’s 3% limit. The government aims to reduce this to 5-5.5% in 2025, but achieving this goal is complicated by the current political gridlock.
François Bayrou’s administration has proposed €50 billion in spending cuts and tax hikes, a less aggressive plan compared to its predecessor under Michel Barnier.
However, political divisions make it difficult to pass meaningful reforms. France’s parliament is deeply fragmented, with no clear majority, making every budget negotiation a battle.
These fiscal challenges haven’t gone unnoticed. Financial markets are growing uneasy, with Moody’s downgrading France’s credit rating in late 2024.
Bond spreads against German debt have widened, indicating increased investor concern.
The country’s political instability is undeniable, having changed four prime ministers in 2024.
Is regulation holding back French businesses?
French businesses are increasingly vocal about the EU’s regulatory framework, which they argue is stifling growth.
The spotlight is on the Corporate Sustainability Reporting Directive (CSRD), a set of ESG (Environmental, Social, and Governance) requirements that critics say impose disproportionate compliance costs.
CSRD could affect up to 50,000 companies, requiring them to report hundreds of ESG data points, which many find overwhelming.
France has called for a “massive regulatory pause” and revisions to simplify these rules.
Proposals include delaying certain banking regulations, easing requirements for mid-sized firms, and narrowing ESG reporting obligations to focus on climate objectives.
The government also highlights the competitive disadvantage European companies face compared to the US, where President Trump has rolled back many regulations in favor of businesses.
These regulatory burdens are part of a broader issue. The French government estimates that the EU’s regulatory framework has cost the bloc 10% of its GDP potential.
It is true that simplifying regulations could help French companies grow and compete internationally, but progress has been slow.
Can political stability be restored?
France’s political turbulence does not help its economic situation. The Bayrou government is navigating a deeply divided parliament where left-wing and far-right parties wield significant influence.
The collapse of the previous government over budget disagreements says a lot about how difficult it is for parties to reach consensus.
Bayrou is trying to secure support from left-wing parties by offering concessions, including a less severe fiscal consolidation plan.
However, tensions remain high, and another no-confidence vote could derail progress.
Political instability is not just a domestic issue—it sends negative signals to markets and investors, further undermining confidence in France’s ability to manage its economy.
Can the French economy make a comeback?
The path forward for France is challenging to say the least. Simplifying regulations and easing fiscal consolidation efforts could provide short-term relief for businesses and households.
However, improving labour market flexibility and reducing public spending inefficiencies would be essential for long-term stability.
Economic recovery may be on the horizon, but not before 2026. Even then, growth is likely to remain subdued, with projections hovering around 1%.
A restrictive fiscal policy and an uncertain international environment could limit the recovery’s scope.
France’s situation is a warning for the rest of Europe. Whether France’s leaders can rise to the occasion will determine not only the country’s economic trajectory but also its role within the European Union.
The post France’s dire economic and political situation is a warning for Europe appeared first on Invezz
Activist investor Ancora Holdings has acquired a stake in US Steel and is urging the steelmaker to abandon its merger agreement with Japan’s Nippon Steel, according to a Wall Street Journal report.
Ancora intends to encourage shareholders to remove US Steel’s CEO David Burritt, according to the report. The activist investor’s stake in US Steel is still unknown.
According to the WSJ, Ancora has nominated nine director candidates, including former Stelco chief Alan Kestenbaum, to the company’s 12-person board. Ancora is reportedly not interested in selling the American steelmaker to another party.
Bloomberg News reported that the hedge fund wants Kestenbaum to replace Burritt as CEO.
Nippon and US Steel deal
Earlier this month, former US President Joe Biden cited national security concerns to block Nippon Steel’s $14.9 billion acquisition of US Steel. The order also mandated that Nippon abandon the bid by June.
The Biden administration is being sued by the companies for preventing the acquisition.
Nippon Steel’s potential acquisition of US Steel was also opposed by the US President Donald Trump.
In December, Donald Trump expressed his strong opposition to the specific deal on a social media platform, stating resolutely, “I will block this deal from happening.”
This declaration highlights Trump’s intent to use his influence and authority to prevent the deal from reaching completion.
Other firms interested in US Steel
Earlier in January, Reuters reported that Cleveland-Cliffs, a competitor in the steel industry, was collaborating with another steelmaker, Nucor, to explore a potential all-cash offer to acquire US Steel.
This development suggests that US Steel may be a target for acquisition, with Cleveland-Cliffs and Nucor potentially emerging as key players in a potential bidding war.
Cliffs Natural Resources Inc. had previously expressed interest in acquiring US Steel Corporation, but the proposed deal was met with resistance from the company.
Antitrust concerns
The American steelmaker cited concerns over potential antitrust issues that could arise from the merger, as well as the impact on the US automotive industry due to the consolidation of steel supply.
A merger between the two companies could potentially lead to a scenario where up to 95% of US iron ore production would be controlled by a single entity.
This level of consolidation raises significant antitrust concerns, as it could grant the merged company substantial market power and the ability to influence prices and supply.
Additionally, US automakers, who rely heavily on domestic steel supply, expressed apprehension about the potential for reduced competition and increased costs that could result from the merger.
Ancora Holdings, known for its activist investor strategies, has previously targeted and pushed for changes within several other companies.
These include prominent names in the transportation and logistics sector, such as C.H. Robinson, a global provider of multimodal transportation services and logistics solutions.
Other companies include Norfolk Southern, a Class I freight railroad company operating in the eastern United States; and Forward Air Corporation, a freight and logistics company specializing in expedited less-than-truckload shipping.
Ancora’s involvement in these companies typically involves advocating for strategic shifts, operational improvements, or changes in corporate governance, often with the goal of enhancing shareholder value.
The post Why activist investor Ancora Holdings wants US Steel to drop Nippon merger? appeared first on Invezz
The USD/MXN exchange rate has recently pulled back, ending the strong Mexican peso sell-off a few weeks ago. It retreated from this month’s high of 20.93 to the current 20.40 and is hovering near its lowest point since December 26. So, what will be the USDMXN forecast ahead of the Fed and Mexico rate decision?
Mexico’s central bank decision ahead
The USD/MXN exchange rate has pulled back as investors focus on the upcoming interest rate decision and the threat of tariffs from the United States.
Donald Trump, the newly inaugurated American president, has warned that he will impose large tariffs on Mexican goods for allowing migrants to the country.
Mexico has responded that it would also retaliate with its tariffs on US goods, a move that would end the USMCA deal that Trump negotiated in his first term.
A trade war between the US and Mexico would have major impacts because of the volume of trade between the two countries. Data shows that the two countries do trade worth almost $1 trillion a year, with Mexico selling goods worth over $500 billion to the US.
Many American companies import goods from Mexico because of the lower cost of doing business there. Mexico has a minimum wage of about $20 per day, while many Americans earn that amount per hour.
Economists expect the cental bank to continue cutting rates in the next meeting scheduled on February 6. It has been in a rate-cutting cycle as it moved them from 11% in February last year to 10% today.
With inflation slowing and trade risks rising, economists expect the bank to deliver a jumbo rate cut next week. The most recent data showed that the headline Consumer Price Index (CPI) fell from 3.69% earlier this month from 3.99% in December.
Federal Reserve decision ahead
The other key USD/MXN news to watch is the Federal Reserve decision on Wednesday. This meeting will set the tone for what to expect later this year.
The Fed has already hinted that it will not cut interest rates in this meeting. The dot plot of the previous meeting pointed to two rate cuts this year, with experts predicting that it will happen in July.
Recent data has showed that US inflation is a big challenge for the economy. The headline Consumer Price Index rose from 2.7% in November to 2.9% in December. Core inflation dropped from 3.3% to 3.2% during the month.
These numbers are still significantly higher than the Fed’s target of 2.0%. Worse, inflation is not showing signs of falling, a move that may necessitate higher rates for a while.
There will be other key economic numbers to watch this week, including the US GDP and personal consumer inflation report.
USD/MXN technical analysis
The daily chart shows that the USD/MXN exchange rate peaked at 20.93 this month and then pulled back to 20.42. It formed a rising wedge chart pattern, which often leads to a strong bearish breakdown.
The pair has formed a bearish divergence as the MACD and the Relative Strength Index (RSI) have moved downwards. Therefore, the most likely scenario is where the USD to MXN exchange rate crashes, potentially to 19 after the Fed and Banxico decisions.
This retreat will happen as investors price in the impact of Donald Trump’s policies and their impact on the Mexican economy.
The post USD/MXN forecast: bearish divergence, rising wedge forms appeared first on Invezz
France finds itself in a challenging economic and political situation that raises alarms for the rest of Europe.
With GDP growth forecast at just 0.6% for 2025 and a budget deficit projected to reach 6.1% in 2024, the country is under significant strain.
The government has introduced fiscal adjustments and regulatory changes, but are these measures enough to stabilize the economy, or does France need more profound reforms to truly turn things around?
How weak is the French economy?
The French economy has started 2025 on a sluggish note. Growth has been grinding to a near halt, with the fourth quarter of 2024 shrinking by -0.1% and only marginal improvement (0.1% growth) is expected in the first quarter of 2025.
According to research by ING, forecasts for the full year show GDP expanding by just 0.6%—a far cry from the 1.1% growth seen in previous years.
The business climate index remains stuck at 95, below its long-term average. In key sectors like industry and construction, order books are shrinking, making declining activity evident.
In fact, industry order books are at their lowest level since 2014, while the construction sector faces another challenging year as demand falters.
Even services are showing cracks. Real estate activities are holding steady, but almost all other sub-sectors are performing below average.
Meanwhile, household consumption is subdued despite falling inflation and rising real wages.
Instead of spending, many households are saving more due to fears about unemployment and economic uncertainty.
Why are public finances under pressure?
The nation’s budget deficit reached 6.1% of GDP in 2024, far above the EU’s 3% limit. The government aims to reduce this to 5-5.5% in 2025, but achieving this goal is complicated by the current political gridlock.
François Bayrou’s administration has proposed €50 billion in spending cuts and tax hikes, a less aggressive plan compared to its predecessor under Michel Barnier.
However, political divisions make it difficult to pass meaningful reforms. France’s parliament is deeply fragmented, with no clear majority, making every budget negotiation a battle.
These fiscal challenges haven’t gone unnoticed. Financial markets are growing uneasy, with Moody’s downgrading France’s credit rating in late 2024.
Bond spreads against German debt have widened, indicating increased investor concern.
The country’s political instability is undeniable, having changed four prime ministers in 2024.
Is regulation holding back French businesses?
French businesses are increasingly vocal about the EU’s regulatory framework, which they argue is stifling growth.
The spotlight is on the Corporate Sustainability Reporting Directive (CSRD), a set of ESG (Environmental, Social, and Governance) requirements that critics say impose disproportionate compliance costs.
CSRD could affect up to 50,000 companies, requiring them to report hundreds of ESG data points, which many find overwhelming.
France has called for a “massive regulatory pause” and revisions to simplify these rules.
Proposals include delaying certain banking regulations, easing requirements for mid-sized firms, and narrowing ESG reporting obligations to focus on climate objectives.
The government also highlights the competitive disadvantage European companies face compared to the US, where President Trump has rolled back many regulations in favor of businesses.
These regulatory burdens are part of a broader issue. The French government estimates that the EU’s regulatory framework has cost the bloc 10% of its GDP potential.
It is true that simplifying regulations could help French companies grow and compete internationally, but progress has been slow.
Can political stability be restored?
France’s political turbulence does not help its economic situation. The Bayrou government is navigating a deeply divided parliament where left-wing and far-right parties wield significant influence.
The collapse of the previous government over budget disagreements says a lot about how difficult it is for parties to reach consensus.
Bayrou is trying to secure support from left-wing parties by offering concessions, including a less severe fiscal consolidation plan.
However, tensions remain high, and another no-confidence vote could derail progress.
Political instability is not just a domestic issue—it sends negative signals to markets and investors, further undermining confidence in France’s ability to manage its economy.
Can the French economy make a comeback?
The path forward for France is challenging to say the least. Simplifying regulations and easing fiscal consolidation efforts could provide short-term relief for businesses and households.
However, improving labour market flexibility and reducing public spending inefficiencies would be essential for long-term stability.
Economic recovery may be on the horizon, but not before 2026. Even then, growth is likely to remain subdued, with projections hovering around 1%.
A restrictive fiscal policy and an uncertain international environment could limit the recovery’s scope.
France’s situation is a warning for the rest of Europe. Whether France’s leaders can rise to the occasion will determine not only the country’s economic trajectory but also its role within the European Union.
The post France’s dire economic and political situation is a warning for Europe appeared first on Invezz