Markets await speeches by at least nine Fed officials including Fed Chairman Powell this week. Traders are betting that the probability of not raising interest rates in December is as high as 90%.
U.S. stocks turned upward at the end of the session. The Nasdaq index rose for seven days for the first time since January, the Dow and S&P markets rose for six days, and Russell's small-cap stocks fell more than 1%. The OpenAI developer conference boosted large technology stocks. Microsoft rose seven times in a row to a four-month high, and AI concept stocks such as C3.ai pulled back. The China Securities Index outperformed the market by nearly 2% at the beginning of the session, and finally fell slightly and remained at a three-week high. “Double 11" concept stocks such as Pinduoduo, JD, and Alibaba rose sharply. Ideal Auto rose more than 8%, and Betta fell 10%.
The US dollar and US bond yields reached new daily highs at the end of the session. The two- and 10-year US Treasury yields both rose 11 basis points. The US dollar broke away from its lowest level in nearly seven weeks, and the offshore renminbi once rose 200 points to 7.27 yuan. Oil prices closed higher, but US oil still hovers around a two-month low, and oil distribution is close to a one-month low. The warm weather caused European and American natural gas to drop by more than 6%. Spot gold hit a new daily low and fell below 1980 US dollars at the end of the session, and London metals rose sharply.
Investors are waiting for at least nine Fed officials, including Fed Chairman Powell, to speak this week. Federal Reserve Governor Cook did not comment on monetary policy, but warned that non-bank institutions such as hedge funds and money markets may increase the pressure on financial conditions and economic slowdown.
Futures traders bet that the probability that the Fed will not raise interest rates in December is as high as 90%, mainly because non-farm payrolls in October last Friday increased expectations of a slowdown in the US economy, or supported the Fed in ending the interest rate hike cycle. The next focus is next week's CPI inflation data for October.
However, concerns about the economic downturn in the Eurozone increased. The final value of the PMI for October fell to its lowest value since November 2020, and contracted for five consecutive months. The service sector further weakened, business activity declined at an accelerated pace, and the new orders index hit an 11-year low after excluding the impact of the COVID-19 pandemic.
The market expects the Fed's benchmark interest rate to remain above 5% until June next year, and that it may cut interest rates by 25 basis points four times by the end of next year. It is also expected that the European Central Bank will cut interest rates by as much as 100 basis points next year, and the probability that interest rate cuts will begin in April next year is about 80%.
However, the ECB voting committee warned on Monday that it is necessary to be prepared to raise interest rates again if necessary. The Bank of England's chief economist said that the country's inflation is still too high and stubborn, and the Reserve Bank of Australia may resume raising interest rates this Tuesday due to high inflation.
US stocks turned positive at the end of the session. The NASDAQ rose for seven days for the first time since January. The OpenAI developer conference boosted large technology stocks
On Monday, November 6, after the three major US stock indices all recorded the best weekly gains of the year last week, the major indices collectively opened higher. However, they all turned down during midday trading, and Russell's small-cap stock fell 1.6% and performed the worst. Despite the rebound in treasury bond yields, the S&P technology sector maintained gains.
U.S. stocks rose again at the end of the session, but small cap stocks remained down more than 1%.In the end, the Dow rose steadily above 34,000 points for six days, setting a new high for more than six weeks since September 21; the S&P market rose for six days, breaking the three-week high since October 17, and the longest consecutive increase since June and July, respectively; and the NASDAQ rose for seven days, the longest cycle since January, and the highest since October 17. Russell's small-cap stocks stopped rising for five days and broke away from a two-and-a-half-week high:
The S&P 500 index closed up 7.64 points, or 0.18%, to 4365.98 points, with the real estate sector leading the decline. The Dow closed up 34.54 points, or 0.10%, to 34095.86 points. The Nasdaq closed up 40.50 points, or 0.30%, to 13518.78 points. The Nasdaq 100 rose 0.4%, the Russell 2000 small-cap index fell 1.3%, and the “panic index” VIX fell slightly and was still below the 15 mark.
The Nasdaq has been rising for seven days for the first time since January, the Dow Index has been rising for six days, and Russell's small-cap stock market is down on the 50-day EMA
The gains of Star Technology stocks increased after midday trading.Metaverse” Meta” rose 0.4%, Apple rose 1.5%, all to the highest level in three weeks, Amazon rose 0.8%, the highest in seven to seven weeks, Netflix rose 0.5% to the highest in eight weeks, Microsoft rose 1%, and the highest in the past four months. Google A rose nearly 1% to recover nearly half of the decline since October 24; Tesla rose nearly 3% and then fell 2%, and finally closed down 0.3%.
Chip stocks have had mixed ups and downs.The Philadelphia Semiconductor Index closed down 0.3% after falling more than 1%. It stopped rising for four days and is still close to a two-and-a-half-week high. Intel declined slightly but remained at a seven-week high, AMD's decline narrowed to 0.5% away from a three-month high, and Nvidia rose 1.7% to a three-week high.
AI concept stock pullback。 C3.ai fell nearly 6% out of a two-month high, Palantir Technologies fell nearly 2% away from a three-month high, and Soundhound.ai fell more than 3% from a two-and-a-half-week high, but BigBear.ai rose more than 3% and rose more than 3% to a one-month high for three days.
According to the news, Tesla plans to produce 25,000 euros of civilian electric vehicles in Europe. A schedule has not yet been provided, and the production capacity of its German factory is scheduled to double to 1 million vehicles per year. OpenAI hosted its first developer conference, released its most powerful AI, GPT-4 Turbo, and allowed users to build custom versions of ChatGPT. Bank of America is optimistic about Nvidia's three-quarter report to be released on November 21. It is expected to exceed expectations and raise performance guidelines.
The China Securities Index significantly outperformed the US stock market at the beginning of the session, then its gains narrowed.ETF KWEB closed up 0.4% after rising 2%, CQQQ rose nearly 2%, and Nasdaq Jinlong China Index (HXC) rose nearly 2% at the beginning of the session and fell slightly by nearly 2%. Although it stopped rising for two days, it still hovered around a three-week high.
Among Nasdaq's 100 constituent stocks, JD rose 0.6%, Baidu fell by more than 1%, and Pinduoduo rose 0.7%. Among other individual stocks, Alibaba is close to erasing the 1.7% increase, Tencent ADR rose more than 1%, Station B fell 1%, NIO Auto fell more than 3%, Xiaopeng Auto rose 1.7%, and Ideal Auto rose more than 8%. Daily Fresh, which had a pre-market increase of more than 15%, closed up 2.7%. Betta fell 10% after news that CEO Chen Shaojie had lost contact last month.
Bank stock indexes stopped rising for five days.The KBW Bank Index (BKX) of the Philadelphia Stock Exchange (BKX), the industry benchmark, fell 0.9% from a six-week high. Two weeks ago, it hit a three-year low since September 2020. The KBW Nasdaq Regional Banking Index (KRX) fell 1.2% away from its seven-week high. On May 11, it was the lowest since November 2020. However, Citigroup, the bank with the third largest asset value in the US, fell by 1% and then cut its decline in half, breaking away from the highest level in six weeks. The media said it was considering layoffs of at least 10% in several major business divisions, and the proportion of senior management layoffs may be even higher.
Other individual stocks that have changed a lot include:
Class A shares of Berkshire Hathaway, owned by Buffett, fell 1.4%, stopping a five-day rise and breaking away from a five-week high, despite a 40% increase in operating profit in the third quarter to 10.76 billion US dollars, and cash reserves reached a record high of 157.2 billion US dollars.
Dish Network, the fourth largest provider of live online TV programs in the US, fell more than 37%, the worst performance since listing. The stock price fell below $4 to its lowest level in 25 years since the end of 1998. There was an unexpected loss per share in the third quarter, and revenue fell short of expectations.
Disney announced before Wednesday's earnings report that Hugh Johnston, who has worked at Pepsi for 34 years and has been promoted to CFO in the past few years, will move to Disney as CFO and senior executive vice president. Disney fell more than 1% and temporarily left a two-week high, and Pepsi has basically erased the 1% decline.
Media and entertainment giant Paramount fell nearly 8% globally to break out of its seven-week high. Bank of America directly downgraded its rating from “buy” to “sell” by two levels, saying there are no major opportunities to sell some businesses in the near future. Last week, the stock surged 27% on Thursday and Friday due to favorable three-quarter reports.
Albemarle (Albemarle), a major supplier of lithium for electric vehicle batteries, fell nearly 7% to a three-year low. UBS downgraded its rating from “buy” to “neutral” and cut the target price by more than 40%, saying that future lithium sales growth is at risk.
European stocks generally declined; only the British stock index closed. The pan-European Stoxx 600 Index closed down 0.16% and stopped rising for five days. It remained hovering at a two-week high, with the oil and gas sector leading the way in rising nearly 1%. The UK mid-cap stock index fell by more than 1.3%; the MSCI Global Index rose for six consecutive trading days.
US bond yields reached new daily highs at the end of the session. Both 2-year and 10-year yields rose 11 basis points, and European bond yields followed suit
After falling sharply on Friday, US bond yields rose collectively on Monday. Two-year US Treasury yields, which are more sensitive to monetary policy, rose 11 basis points to 4.94%, breaking away from their lowest level in two months. They fell 9 basis points on Friday and 18 basis points last week.
The 10-year base bond yield also rose more than 11 basis points to 4.67%, breaking away from a five-and-a-half-week low. It fell 13 basis points to 4.48% on Friday and a cumulative decline of about 29 basis points last week, the biggest weekly decline in at least eight months since March.
The yield on European bonds also followed the performance of US bonds. The 10-year Italian bond yield, which is the benchmark for heavily indebted peripheral countries, rose more than 13 basis points, leading the way.
The Eurozone benchmark 10-year German bond yield rose by about 10 basis points, reached a fresh daily high of 2.74% at the end of the session, and stopped falling for seven days. After the US non-farm payroll release on Friday, it hit a seven-week low of 2.63% since September 15, and the biggest weekly decline in five months.
The two-year German bond yield rose nearly 7 basis points. Both French and Spanish 10-year base bond yields rose by more than 10 basis points. Furthermore, the yield on two-year British bonds rose by more than 4 basis points, breaking away from the lowest in nearly five months set on Friday. The yield on 10-year British bonds rose by more than 9 basis points, and reached a new high of 4.38% at the end of the session. It was the lowest in five and a half weeks last Friday. Markets await UK GDP data for the third quarter.
Oil prices narrowed after an intraday increase of about 2%. US oil hovered around a two-month low, crude oil was close to a one-month low, and European and American natural gas fell
Saudi Arabia and Russia reiterated the reduction of oil supply until the end of the year. Oil prices rose sharply, but the increase narrowed in the afternoon. WTI December futures closed up $0.31, or 0.38%, to $80.82 per barrel. Brent futures for January closed up $0.29, or 0.34%, to $85.18 per barrel.
USOIL's WTI rose as high as 1.72 US dollars or 2.1%. The daily high once rose above 82 US dollars, but it still hovered at a two-month low since the end of August. The highest increase in oil was 1.57 US dollars, or 1.8%. At one point, it rose above 86 US dollars, and is still hovering at a one-month low since October 6.
According to some analysts, Saudi Arabia will maintain production cuts of 1 million b/d, and Russia will continue to cut exports of oil and its products by 300,000 b/d. Combined with the imminent increase in US oil sanctions against Iran, all of which are conducive to raising oil prices. However, the background of Saudi Arabia and Russia's production cuts is that the economy and demand are weak, and that production cuts may be extended until the first quarter of next year, which will still trigger oil price concerns. Oil prices fell 6% last week.
TTF Dutch gas futures, the European benchmark, fell more than 6% at the end of the session, further away from the 50 EUR/MWH integer, hitting a four-week low since October 9; ICE UK gas also fell by more than 6.5%, all due to sufficient supply and warm weather. US gas futures fell more than 7% to a one-week low, also because warm weather was not conducive to heating demand on the east coast of the US.
Betting on the end of the Fed's interest rate hike stabilized the US dollar. After breaking away from its lowest level in nearly seven weeks, the offshore renminbi once rose 200 points to 7.27 yuan
The DXY, which measures a basket of US dollars against six major currencies, rose slightly and remained stable above 105, hitting its lowest level in nearly seven weeks since September 20. Last Wednesday, it rose above 107 for the first time since October 4, but fell 1.4% throughout the week, the biggest drop since July.
The euro turned down in the US stock market against the US stock market and remained stable above 1.07, breaking away from the previous eight-week high since September 13. The pound also declined slightly and fell below 1.24, hitting a seven-week high earlier. The Japanese yen fell back to the 150 mark against the US dollar, breaking away from its monthly high. Some analysts believe that the 155 mark may trigger the Japanese government to bail out foreign exchange. At one point, the offshore renminbi peaked at 7.27 yuan, up 200 points from the previous day's closing.
According to some analysts, due to people's growing confidence that the Fed has already raised interest rates, US bond yields have declined rapidly recently, which has also caused the US dollar index to fall off its high level.
Spot gold hit a new daily low and fell below 1980 US dollars at the end of the day. London metals rose sharply, zinc rose nearly 2%, and aluminum, nickel, and tin both rose more than 1%
The stability of the US dollar and the rise in US bond yields put pressure on the price of gold. COMEX December gold futures closed down $10.60, or 0.53%, to $1988.60 per ounce, while December silver futures fell 0.22% to $23.234 per ounce.
Spot gold widened to 0.7% after midday trading in the US stock market, breaking the daily low and falling below the 1980 dollar integer. It fell 14 US dollars during the day, erasing more than a week of gains since October 26.
According to some analysts, if gold continues to stay above 2,000 US dollars, it may be necessary for the Fed to send a more clear signal that interest rate cuts are coming, and investors return to ETF purchases. Driven by safe-haven demand from the Middle East conflict in October, the price of gold rose by more than 7%, and net futures bullishness increased.
London's industrial base metals rose sharply.The economic trend indicator “Dr. Copper” rose 0.8%, Lun Aluminum rose 1.5%, and Lun Zinc rose 1.9%, all of which hit five-week highs since the beginning of October. Lun and lead rose 0.4% to a five-week high, Lun Nickel rose 1.2%, and Lunxi rose 1.3%, all to monthly highs.
Shanghai Zinc closed up nearly 1.3% overnight, international copper and Shanghai copper rose 0.4%, Shanghai Aluminum and Shanghai Tin rose 0.9%, and Shanghai nickel rose 0.3%. Copper stocks on the Shanghai Stock Exchange rose 11% on Friday and are still hovering at a one-year low. LME inventories fell after several months of continuous increases, all of which are signs of favorable demand.
edit/ruby