On the evening of the 19th, Beijing time, US stocks opened lower on Thursday, and yesterday's downward momentum continued. Market fears that the Fed will raise interest rates aggressively and lead to a recession have intensified, with JPMorgan Chase & Co CEO predicting that the Fed could raise interest rates to 6 per cent. The number of initial claims for unemployment benefits in the United States fell to 190000 last week, the lowest level in nearly four months.
The three major indexes of US stocks fell slightly in early trading, with the S & P 500 down 0.43%, the Nasdaq down 0.46% and the Dow down 0.48%.
In recent days, optimism in the US stock market in early 2023 has faded, with investors worried that the lagging effect of the Fed's rate hike has begun to hit the US economy.
David Donabedian, chief investment officer of CIBC Private Finance USA, said:
The real estate market is clearly in recession, and manufacturing is hovering on the brink of recession. As we enter 2023, consumers will be more cautious, and over time, we will see some signs of a faltering job market. We think there is a slightly more than 50% chance of a mild recession in the United States and the rest of the world this year.
The market followed the speeches made by Fed Vice Chairman Brainard and New York Fed Chairman William Williams on Thursday to understand the position of Fed officials on future monetary policy.
In an interview at the Davos summit, JPMorgan Chase & Co CEO Jamie Dimon reiterated that core inflation is still high and is unlikely to dissipate in the short term, so policy interest rates are bound to be higher than 5 per cent. If the US experienced only a mild recession, it could even raise interest rates to 6 per cent.
Huck, chairman of the 2023 Federal Reserve Committee and chairman of the Philadelphia Federal Reserve, reiterated on Wednesday that he supports the Fed to slow the pace of raising interest rates to 25 basis points because of signs that high inflation is cooling.
On Thursday, the Labor Department reported that the number of initial jobless claims in the week ended Jan. 14 was 190000, the lowest since the week of Sept. 24, 2022. The number of renewed claims for unemployment benefits in the week ended January 7 was 1.647 million, with an expected value of 1.66 million, with a previous value of 1.634 million.
The agency believes that the unemployment data of the United States at the beginning of last week showed a strong job market. The number of initial jobless claims in the US unexpectedly fell last week to its lowest level since September, highlighting the strong job market and the reluctance of many companies to cut jobs. But the agency also points out that the data are particularly volatile and that it is difficult to make seasonal adjustments before and after the holidays.
Many economists expect the number of layoffs to increase further in the coming months as the Fed continues to raise interest rates and keep them high to dampen the economy. Initial jobless claims in California have increased on an unadjusted basis, but the figures may be affected by severe flooding in the state.
For the Philadelphia Fed manufacturing index, analysts believe the survey shows that supply bottlenecks and backlogs are disappearing at a fairly rapid rate. Overall, manufacturing is slowing, but this is not surprising given the bullwhip effect of strong demand growth during the outbreak. Carmaking still supports the industry, but that momentum will fade by the end of the year. Inflation figures are falling.
Focus stocks
Most of the star technology stocks fell, Netflix Inc and NVIDIA Corp fell by more than 1%, Amazon.Com Inc, Apple Inc and Microsoft Corp fell nearly 1%, and Tesla, Inc. and Alphabet Inc-CL C rose slightly.
Most of the hot Chinese stocks rose, with New Oriental Education & Technology Group up more than 9%, Pinduoduo and Trip.com up more than 3%, and Baidu, Inc., JD.com and BABA up nearly 3%.
$Pfizer (PFE.US)$Down slightly, company CEO Alberle said at the World Economic Forum on Wednesday that it would launch 19 products, including vaccines against RSV, influenza and meningococcal, within 18 months, a rate that could be unprecedented in the pharmaceutical industry. Aberle also revealed that Pfizer Inc is continuing the development of COVID-19 vaccine and is currently studying the XBB 1.5 variant. The company is also working to develop a COVID-19 vaccine that can provide protection for a year.
After Thursday's trading, the streaming media leader$Netflix (NFLX.US)$It will be the first well-known Internet company to disclose its performance in this round of earnings season. In terms of the most key subscription indicator, the market expects the company to add 4.5 million subscribers to its Q4, the worst-performing Q4 data since 2014. Last season, Netflix Inc released hit works including "Wednesday", "out of the scabbard", "Harry and Megan" and so on.
It is worth noting that Netflix Inc launched a $6.99 / month advertising subscription service in November last year, and the relevant performance will be tested by investors for the first time. However, the new low-cost subscription service accounted for 15.5 per cent and 9.3 per cent of US subscribers in December and November, respectively, while subscribers accounted for less than 1 per cent of all US subscribers, according to Antenna, a streaming data company. As of press time, Netflix Inc is down more than 1%.
$Procter & Gamble (PG.US)$It fell nearly 1%, and reported on Thursday that revenue of $20.77 billion and net profit of $3.9 billion were in line with market expectations, but fell slightly compared with the same period last year.
$Alcoa (AA.US)$After falling more than 2%, the company announced a sharp increase in its fourth-quarter loss, which it blamed on falling aluminum prices and rising costs.
Edit / Somer