AI Optimism Propels Global Stocks to Records | Bloomberg: The Asia Trade, 10/03/25

Market Trends & Opportunities - Bullish tech momentum saves Wall Street from losses, OpenAI's share sale boosts sector optimism [1] - Japan's equities rally continues, driven by optimism for political stability after elections and potential BOJ rate hike [1] - Private credit markets are booming, considered a $17 trillion industry, but Fitch indicates bubble-like attributes [5] - AI is expected to boost productivity, but evidence is skimpy, with U S productivity growth around 2% annualized, close to the long-term average [2] - Data centers are an interesting area for PIMCO, with big deals in the U S and Europe seen as the next frontier [38] Risks & Challenges - U S government shutdown risks revive steepener trade, potential impact on economic output is a few basis points of GDP [1] - Fiscal prudence is declining globally, with concerns about secular inflation and fiscal profligacy in the U S and Europe [2] - Japan's LDP does not have a majority in either block of parliament, raising concerns about cutting the consumption tax and increasing Japan's debt [3] - EU is considering hiking steel import tariffs to 50% to align with U S policy in response to cheaper alternatives from China [4] - Sloppy underwriting in dealmaking is a concern, with questions about collateral quality and the return of capital [48][49] Company Performance & Strategies - Tesla shares are green as investors bet a record quarter of sales will be hard to repeat [1] - Goldman Sachs is active in private credit in Asia for over 25 years, seeing renewed interest from private equity firms in Japan [6] - PIMCO is working alongside banks, taking some of their loans into private credit strategies, creating a more resilient credit market [25][26] - LG Energy will start sending South Korean workers back to the U S for essential business trips after detentions [8]