Market analysis on January 30

Today is January 30th. The Dow hit record highs for three consecutive days. The S&P 500 index rebounded to an all-time high, while the Nasdaq index also rebounded to a two-year high. On the eve of the earnings report, Microsoft rose more than 1%, and Google hit a record high. The chip stock index stopped after two days of decline. AMD closed surging and did not continue to fall below its historical high. Nvidia rose more than 2% to a new high. Tesla rose more than 4%. On the same day, US stocks showed that the Dow rose 0.59%, the S&P 500 index rose 0.76%, and the NASDAQ rose 1.12%.

Spread trading may become a trigger for “liquidity risk” in the US financial system this year. The size of US bond holdings in base difference trading may have exceeded 1 trillion US dollars, and the net short positions of leveraged funds in US Treasury futures have also increased dramatically. If this round of base difference arbitrage trading is reversed, then the liquidity problem will spread faster in the financial system.

The US Treasury lowered its expectations for the size of loans for the first quarter. Surprisingly, the amount of loans did not increase but declined. The issuance of US corporate bonds reached 176 billion US dollars in January, a record high for the same period. After the US Treasury announced a reduction in first-quarter borrowing expectations, the rise in US stocks widened, and the decline in US bond yields widened. The 10-year yield fell by 4.10%, hitting a new low of more than a week, while the US dollar index fell to a six-week high. Crude oil rose more than 1% in the intraday period and then fell by more than 1%, ending three consecutive gains and falling to a two-month high. Gold rebounded to a one-week high. Bitcoin surged above $43,000 in the intraday period, hitting a new high of nearly two weeks.

On the Chinese market side, during the US stock period, the China Stock Index fell 1%, falling for three consecutive days. Among them, Pinduoduo fell more than 8% and New Oriental fell by more than 4%; the offshore RMB fell more than 100 points and approached 7.20, then turned up several times later. The GEM closed down more than 3%, the Chinese word bucked the trend and surged. The photovoltaic sector suffered a setback, the three major indices of Hong Kong stocks closed higher, and the pharmaceutical market fell collectively.

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