Markets await Nvidia's earnings report and the minutes of the Federal Reserve's November meeting, and raised the interest rate cut forecast for March next year to 30%, the Dow closed 200 points to the highest in three months, the S&P market broke away from the technical level, the NASDAQ and NASDAQ 100 rose more than 1%, Nvidia and Microsoft both rose 2%, and the Nasdaq Jinlong China Index closed 3.6%, rising to a six-week high on the sixth day in seven days. JD, Baidu, Pinduoduo, and Tencent ADR all rose 3%, and Xiaopeng Auto rose more than 8%.
The steady bidding of 20-year US Treasury bonds caused long-term bond yields to decline. The US dollar was the lowest in two and a half months, and the yen rose 1% to 148. The onshore and offshore renminbi both rose above 7.17 yuan, jumping 500 points to the highest level in more than three months. Oil prices rose 3% in the intraday period and rebounded for two consecutive days. Gold's decline narrowed to 1980 US dollars, and Lundong rose nearly 2% to the highest level in two months.
Markets await Nvidia's earnings report on Tuesday and the minutes of the Federal Reserve's November FOMC meeting. The former may reveal 2024 AI demand trends, while the latter may provide clues about interest rate paths. Futures traders bet the probability that the Fed will start cutting interest rates as early as March next year is 30%.
On Thursday, the US stock market and the US bond market will be closed for one day due to the Thanksgiving holiday, and both will close early on Friday. Thanksgiving Day and “Black Friday” promotions will provide important metrics to measure the state of consumer spending in the US.
The market is also betting that the possibility that the ECB will start cutting interest rates as early as April next year is as high as 70%, and that it may cut interest rates by 100 basis points next year. However, the ECB Governing Council and President of the Bank of Spain said that it is definitely too early to start talking about cutting interest rates.
Next year's FOMC voting committee member and Richmond Fed Chairman Barkin also said that now is not a good time to give forward-looking guidance on interest rates; “maintaining higher interest rates over a longer period of time” will depend on changes in the US economic situation. The market agreed that the Federal Reserve had completed raising interest rates.
The Bundesbank predicts that the “European locomotive” German economy will continue to shrink in the fourth quarter of this year due to weakening external demand and high energy prices, but market participants' expectations about the economic boom have stabilized, and it is optimistic that Germany will resume growth early next year.
The Dow closed up 200 points, the NASDAQ and the NASDAQ 100 rose more than 1%, and the Microsoft, Nvidia, and NASDAQ technology indices all reached new highs
On Monday, November 20, the three major US stock indices opened high and closed collectively near daily highs. At midday trading, the NASDAQ and the NASDAQ 100 rose more than 1%, the Dow rose 200 points and rose above 35,000 points, and Russell's small-cap stock rose above 1,800 points.
The technology, communications services, and energy sectors saw the best gains in the S&P market, with Boeing and Intel as constituent stocks boosting the Dow. The Nasdaq Technology Market Value Weighted Index (NASDAQ Technology Index for short), Microsoft, and Nvidia both reached record intraday highs.
By the close, the Dow rose for the sixth day in seven trading days to a three-month high since August 14. The S&P market and the NASDAQ both rose for five consecutive days, the S&P hit a high since August 1 and broke away from the technical level consolidation. The NASDAQ hit a high since July 31, and Russell's small-cap stock hit a two-month high since September 20. The NASDAQ's 100 rise exceeded 16,000 points, hitting a new high in the past two years since January 2022:
The S&P 500 index closed up 33.36 points, or 0.74%, to 4547.38 points. The Dow closed up 203.76 points, or 0.58%, to 35151.04 points. The NASDAQ closed up 159.05 points, or 1.13%, to 14284.53 points. The “panic index” VIX fell to the 13 range, the lowest in two months since September 15.
The Russell 2000 small-cap stock index rose 0.5%, the NASDAQ 100 rose 1.2%, and the Nasdaq Technology Market Value Weighted Index (NDXTMC, NASDAQ Technology Index for short), which measures the performance of technology companies in the NASDAQ 100, rose 1.5%, reaching the highest closing in history.
Some analysts say that in addition to optimism that the Fed has ended its interest rate hike, the low trading volume before the Thanksgiving holiday will also affect market trends. November has always been the month with the best performance in the S&P market. Currently, both the Dow and S&P are moving towards the best gains since October 2022.
Star technology stocks rose sharply. Metaverse” Meta” rose 1.5% for three days to a two-year high, Amazon rose 0.7% to a 19-month high, Microsoft rose 2% to the highest closing in history, Apple rose nearly 1%, rose to a five-day high of three and a half months, Netflix rose nearly 2% to a four-month high, Google A rose 0.7% close to a three-week high, and Tesla rose 0.6% after falling 1.4%, not far from the four-week high set last week.
Chip stocks generally rose, and many individual stocks reached record highs. The Philadelphia Semiconductor Index rose 1.5%, breaking 3,800 points to a new three-and-a-half-month high since August 1. Intel rose more than 2% to the highest in 19 months, AMD rose 0.8% to the highest in five months, Nvidia rose more than 2% to the highest closing in history, and Broadcom and Colay KLA Corporation also reached record highs.
AI concept stocks declined rapidly at the end of the session. C3.ai rose more than 7% and then fell by more than 4%, missing a new high in two and a half months. Soundhound.ai broke away from the two-month high, and Bigbear.ai closed up only 2% after rising more than 8%, but Palantir Technologies rose 4% to a two-year high.
According to the news, former CEO Sam Altman, who was ousted by OpenAI's board of directors on Friday, will join Microsoft to lead a new senior artificial intelligence research team. More than nine OpenAI employees, including the chief scientist, threatened to resign, demanding that the company re-hire Altman and the board of directors step down. Many mainstream brokerage firms are optimistic that Microsoft's AI advantage will expand as a result. C3.ai will lay off employees. Customer relationship management software leader FTSE Salesforce invited OpenAI researchers to join the AI team.
Broker Bernstein cited the slowing trend of electric vehicle growth and reiterated Tesla's “reduced holdings” rating. According to the media, Apple is unable to achieve its initial goal of launching the mixed reality headset Vision Pro in January next year, and is currently planning to launch it in March next year. It is reported that SK Hynix and Nvidia are jointly discussing the “disruptive” integration method of HBM4, which will be directly integrated into the chip through 3D stacking.
The popular Chinese stock market outperformed the US stock market. ETF KWEB rose 3.7%, CQQQ rose 2.6%, and the Nasdaq Golden Dragon China Index (HXC) rose 3.6%. The intraday high rose 4% and once broke 6,700 points, rising to a high of nearly six weeks on the sixth day in seven days.
Among Nasdaq's 100 constituent stocks, JD, Baidu, and Pinduoduo all rose about 3%. Among other individual stocks, Alibaba rose more than 1%, Tencent ADR rose 3%, and Station B rose more than 4%. NIO Auto rose 5.6%, Xiaopeng Motor rose 8.6%, and Ideal Auto rose 3.7%. A full increase of more than 15%. The co-founder of NIO made a statement earlier to appease investors saying it is “absolutely impossible” for the company to go out of business. Xiaomi's ADR rose more than 2%, revenue and net profit for the third quarter both exceeded expectations, and single-quarter profit hit a new high in the past two years.
Bank stock indexes have recently rebounded due to hopes that the US economy will avoid a recession. The KBW Bank Index (BKX) of the Philadelphia Stock Exchange (BKX), an industry benchmark, is close to erasing the 1% decline at the beginning of the session and hovering at the highest level in three months since August 14. At the end of October, it was the lowest in three years since September 2020. The KBW Nasdaq Regional Banking Index (KRX) fell 0.2% and remains at a high level since September 1. May 11 was the lowest since November 2020. Citigroup rose 0.8% and then turned down, and will cut more than 300 management positions or 10% of managers.
Other individual stocks that have changed a lot include:
The “pandemic dividend stock” Zoom video communication rose 7% after the session. Revenue for the third quarter exceeded expectations, and the full-year revenue guidelines were raised. In addition to Nvidia, there are also earnings reports for retail stocks such as Best Buy, Kohl's, and Lowe's on Tuesday.
Boeing rose 4.6% to the highest level in two months since the beginning of September, and Deutsche Bank raised its rating to “buy”. The reason is that Boeing's accelerated performance improvement trend in aircraft delivery can continue.
Brazilian mining giant Vale rose more than 3% to a seven-month high, and Bank of America raised its rating to “buy” on the grounds that rising iron ore prices would drive an increase in free cash flow.
The US pharmaceutical company Myers Squibb fell nearly 4%, the biggest decline in three weeks and a half years since March 2020. Partner 2Seventy Bio fell 18% to a record low, and the US Food and Drug Administration FDA was unable to approve its early cancer treatment before the target date.
At one point, the European stock of German pharmaceutical company Bayer fell by more than 19%, the biggest decline in history. A large-scale post-trial of an anticoagulant drug was abandoned due to “lack of efficacy,” and because it lost a lawsuit in the herbicide cancer case, a US court demanded that the company pay 1.56 billion US dollars to the plaintiffs.
Furthermore, Global X MSCI Argentina's ETF rose 11% to the highest level in two and a half months since September 1, and the country's energy company YPF rose 40%, the biggest increase since 2009. Millay, known as the “Trump of Argentina,” won the presidential election. His budget reduction plan was popular, and he supported the privatization of YPF, the abolition of the central bank, and the shift of the national currency to the US dollar to curb three-digit inflation.
Inflation has cooled, causing investors to continue to evaluate the prospects for the ECB to cut interest rates next year. Among European stocks, only German and British stock indexes closed down. The pan-European Stoxx 600 index closed up 0.1% to the highest level since September 20. The oil and gas sector led by more than 1%, and the Bank of Italy stock index fell 1.2%.
The steady bidding of 20-year US Treasury bonds caused long-term bond yields to decline, while 10-year US Treasury yields hovered at their lowest level in two months
The yield on two-year US bonds, which are more sensitive to monetary policy, once rose by 2 basis points and was pressured to 4.93%, basically recovering the decline since last Wednesday. The yield on 10-year base bonds turned down in the US stock market. The deepest decline was 3 basis points to 4.41%, the lowest since September 21.
Earlier, the US Treasury auctioned 16 billion US dollars of 20-year treasury bonds and won an interest rate of 4.780%, breaking away from the record high of 5.245% a month ago. The bid multiplier of 2.58 was basically the same as the previous 2.59, which is called strong bidding, thus lowering long-term bond yields.
European bond yields also rushed higher and declined. The 10-year German bond yield, which is the benchmark for the Eurozone, rose 2 basis points to 2.61% at the end of the session. It fell to a two-month low of 2.55% on Friday, the two-year yield rose 6 basis points to 3%, and fell below 2.92% last week to its lowest level in five months.
According to some analysts, the rating agency Moody's last week upgraded Italy's credit rating prospects from negative to stable, and raised Portugal's long-term issuer rating by two levels, narrowing the interest gap between the yield of European treasury bonds of heavily indebted peripheral countries and German base bonds.
Oil prices rose 3% in the intraday period, close to recovering the decline since last Wednesday. US oil rose above 78 US dollars for the first time since November 15
International oil prices continue to be boosted by expectations that OPEC+ may announce deeper production cuts this weekend. WTI December futures closed up $1.71, or 2.25%, to $77.60 per barrel. Brent futures for January closed up $1.71, or 2.12%, to $82.32 per barrel.
The more actively traded US oil WTI futures for January next year rose as high as 2.42 US dollars or 3.2%. In the intraday period, oil rose above 78 US dollars for the first time since November 15, and crude oil rose as high as 2.32 US dollars or 2.9%, and tried to push up 83 US dollars, all close to recovering the decline since last Wednesday.
Last week, US oil fell briefly into a technical bear market compared to the highest level of over a year hit in September, and crude oil also hovered on the edge of a bear market. Although oil prices rose by 4% on Friday, they all fell for four weeks, and the futures structure moved to a “futures premium” (contango), indicating sufficient supply in the short term.
TTF Dutch gas futures, the European benchmark, rose 1.7%, still below the 50 EUR/MWH integer, but recovered more than half of the decline since last Wednesday and broke away from a one-month low. ICE UK futures fell about 2%, and US gas once fell 3% close to a six-week low.
The US dollar was the lowest in two and a half months. The yen rose 1% and hit 148, and both onshore and offshore renminbi rose above 7.17 yuan to the highest in more than three months
The market turned its attention to the Fed's interest rate cut. The DXY index, which measures a basket of US dollars against six major currencies, fell 0.5% as deep as 0.5%, falling below 103.40 to its lowest level in two and a half months since September 1. The US dollar fell by nearly 2% last week, the biggest weekly decline since July.
The euro rose and remained above 1.09 against the US dollar, the highest in three months since mid-August. The pound rose above the two-month high of 1.25 against the US dollar since mid-September. The yen rose to the 148 mark against the US dollar or rose 1% to a seven-week high.
Both onshore and offshore renminbi rose above 7.17 yuan and rose more than 500 points in the intraday period. The onshore renminbi closed at 7.1655 against the US dollar, up 480 points from the previous trading day and night. The offshore renminbi rose nearly 580 points to the highest level in three and a half months since the beginning of August.
According to the Securities Daily, the exchange rate of the RMB against the US dollar has recovered the “7.2” mark, and experts say that positive economic fundamentals are the foundation for the strengthening of the RMB. According to the Shanghai Securities Report, the RMB exchange rate has broken five levels in a row in one day. Driven by short-term optimism, it is not ruled out that the exchange rate will rise to the 7.1 range.
Gold's intraday decline narrowed to 1980 US dollars, Lun Tong rose nearly 2% to a two-month high, and Lun Aluminum rose more than 1.7%
COMEX December gold futures closed down 0.2% to $1980.30 per ounce. COMEX December silver futures closed down 1% to $23.614 per ounce, down half from the beginning of the session.
Before the release of the Federal Reserve's minutes, due to the decline in the US dollar and the decline in US long-term bond yields, the intraday decline of spot gold in the US stock market narrowed markedly and moved up to the 1980 US dollar integer. Last week, it rose above 1990 US dollars to a new two-week high, and increased by more than 2% throughout the week.
The weakening of the US dollar and the boost in demand prospects brought about by China's policies led to a sharp rise in basic industrial metals in London:
The economic weather vane “Dr. Copper” rose nearly 2% and rose above 8,400 US dollars, the highest in two months since mid-September. Lun Aluminum rose 1.7%, recovering the decline since November 9. Both Lun Zn and Lun Xi rose slightly and broke away from one-week lows. Rennell closed down $17,000, still hovering at a two-and-a-half-year low since April 2021. Lun lead alone fell 0.8%. It rose above 2,300 US dollars in the intraday period to the highest level since May last year.