On the evening of the 30th Beijing time, US stocks opened slightly lower on Tuesday. The Federal Reserve will announce the interest rate decision in the early hours of Thursday morning Beijing time. This week, the market will also pay attention to more corporate earnings reports and April non-farm payrolls data.
As of press release, the three major indices have collectively declined. The S&P 500 index fell 0.27%, the NASDAQ fell 0.38%, and the Dow fell 0.47%.
Traders are worried that Powell's remarks after the meeting will be even more hawkish after a series of recent economic data showing intense inflation.
Given that a series of recently released economic data shows that US inflation continues to be high and the economy is still resilient, the market predicts that the Federal Reserve is more likely to keep interest rates high for a longer period of time. Currently, the market expects the Federal Reserve to cut interest rates only once in 2024, by a quarter of a percentage point, compared to the previous forecast of cutting interest rates six to seven times, by one-quarter percentage point each time.
Bank of America American economist Michael Gapen said before the Federal Reserve announced the interest rate decision that the unexpected stubbornness of US inflation made the Fed not confident enough to consider cutting interest rates, causing interest rates to remain high for a longer period of time.
In response to higher-than-expected inflation data, Bank of America drastically revised its forecast over the past month. After initially predicting that interest rates would be cut three times this year, the bank now expects the Federal Reserve to cut interest rates only once in December this year.
Looking ahead, the Bank of America does not rule out the possibility that the Federal Reserve will raise interest rates again, but only if one of the following two situations occurs: the core inflation rate and overall inflation rate rise at an accelerated pace, or inflation expectations rise. Gapen said both of these situations indicate that the supply shock is over and that the economy may be overheating.
The US stock earnings report has entered its busiest week. Amazon and Apple will announce quarterly results after trading on Tuesday and Thursday, respectively.
In terms of economic data, investors will welcome the April non-farm payrolls report this Friday, while data on job vacancies and private sector employment growth will be released on Wednesday.
Individual stocks in focus
Star technology stocks had mixed ups and downs.$Tesla (TSLA.US)$It fell more than 3%,$Intel (INTC.US)$It fell more than 1%,$NVIDIA (NVDA.US)$,$Apple (AAPL.US)$,$Meta Platforms (META.US)$Wait until it weakens slightly,$Amazon (AMZN.US)$,$Advanced Micro Devices (AMD.US)$,$Alphabet-C (GOOG.US)$Slight increase.
Most of the popular Chinese securities firms have declined.$Yum China (YUMC.US)$It fell nearly 8%,$Li Auto (LI.US)$It fell nearly 3%,$JD.com (JD.US)$It fell nearly 2%,$Alibaba (BABA.US)$,$Baidu (BIDU.US)$It fell more than 1%.
$Tesla (TSLA.US)$It fell more than 3%. According to the news, Musk plans to make more layoffs as two Tesla executives leave their jobs.
$Eli Lilly and Co (LLY.US)$It rose nearly 6%, Q1 adjusted net profit increased 60% year over year, and the company raised its annual revenue guidelines.
$HSBC Holdings (HSBC.US)$It rose nearly 5%, and the stock price reached a record high. Q1 revenue increased 3% year over year to US$20.8 billion, profit before tax of US$12.65 billion exceeded expectations, and a total of 31 cents was paid in the first quarter plus the special dividend.
$NXP Semiconductors (NXPI.US)$It rose more than 4%, and the median value of Q2 revenue and adjusted earnings per share guidance was higher than market expectations.
Editor/Somer