Source: Wall Street News
Author: Li Dan
The S&P, NASDAQ, and Google fell to record highs, and the Dow fell back to a one-week low; Tesla fell nearly 3.5%, and Microsoft hit another record high; Target closed down 8%. China's stock index fell more than 1% for three consecutive years, photovoltaic stocks rose more than 10%, and the high-performing Pinduoduo market initially rose nearly 8%, and closed up more than 1%. After the Federal Reserve's minutes, the decline in the US stock index widened. The two-year US bond yield reached a new high, the US dollar index jumped to a one-week high, gold and crude oil hit a new low, falling nearly 2% in the intraday period. After the UK CPI, the pound hit a new two-month high. The offshore RMB fell below 7.25 in the intraday period, hitting a new low during the month. Bitcoin fell to the 70,000 mark after rising by thousands of dollars in the intraday period. Crude oil fell three times in a row. Lun Copper closed down more than 4%, and New York futures continued to fall below record highs. After a record high, New York Copper once fell back more than 6%, and Lun Nickel fell more than 4%.
The minutes of the Federal Reserve meeting are eagles. The minutes show that due to poor inflation data for the first quarter, Federal Reserve officials expect to wait and see more time than they expected before to be more confident that inflation will fall to the target, suggesting that they are not in a hurry to cut interest rates and that interest rates will stay high for longer. A number of officials also expressed their intention to raise interest rates further once inflation reignites. “New Federal Reserve News Agency” Nick Timiraos said that Federal Reserve officials expect to wait longer to cut interest rates, and some people are still open to raising interest rates as inflation accelerates.
After the release of the Federal Reserve's minutes, the decline in major US stock indexes, which fluctuated slightly in the intraday period, rapidly widened, with crude oil and other resource stocks leading the decline. The Dow recorded the worst performance of the month, taking back gains over the past week; the decline in US Treasury bond prices and yields accelerated intraday increases, and the yield on two-year US Treasury bonds, which are sensitive to interest rates, reached a new high level in the past week.
The performance of the leading stocks that released financial reports was mixed: Walmart's rival Target (Target)'s EPS profit fell short of expectations for the first time since November 2022. The company's management mentioned a trend where consumers spent less on optional consumer products. Target, which announced a price reduction for 5,000 products this Monday, caused investors to worry about overall consumer health. The stock price once again fell 10%; Nvidia, which Goldman Sachs traders called the “most important stock on Earth”, announced after the market that its revenue for the first fiscal quarter continued to rise 260%. The current fiscal season's guidance once again crushed expectations and released AI by a sharp rise of 260%. Signs of strong demand made investors more confident about the future of the AI boom, which is the main driving force behind the rise in US stocks, and stock prices, which closed down slightly, rose after the market.
In the intraday period, Google, which recently hit record highs, and Tesla, which rebounded on Tuesday, retreated, and some tech giants continued to rise. After releasing a package of new Copilot AI features at the annual developer conference on Tuesday, Microsoft maintained its gains during the week and reached another record high. Most of China's securities fell, while net profit in the first quarter tripled year on year, and revenue increased by 131%, at the beginning of the Pinduoduo market, and later took back most of the gains; PV concept stocks followed the boom in the A-share PV sector, rising more than 10%.
In the foreign exchange market, the April CPI growth slowed less than expected, and the pound reached a two-month high against the US dollar; after the release of the Federal Reserve's minutes, as the US dollar accelerated its upward trend, the pound recovered most of its gains, and other major non-US currencies fell. For the first time in nearly three weeks, the offshore RMB fell 7.25 in the intraday market, and Bitcoin's gains narrowed and fell to the 70,000 mark. Ethereum, which had previously risen sharply due to the market's expectation of approval of related ETFs from the US Securities Regulatory Commission, also narrowed.
Among commodities, metals declined across the board. Luntong closed down more than 4%, continuing to fall from the closing record high set on Monday. New York copper, which had a record high in daily earnings, fell sharply, falling more than 6% in the intraday period. Analysts believe that in addition to the possibility that the Federal Reserve may delay interest rate cuts, the sharp drop in copper prices may be related to investors starting to make a profit settlement after reaching a record high, recent weak demand, and a possible increase in production this year in Peru, the world's third-largest copper producer last year. The Federal Reserve minutes dampened the prospects for interest rate cuts. Gold's decline widened, falling close to 2% intraday, speeding down from the record high set on Monday.
International crude oil continued its decline in the first two days of this week, falling more than 1% to a one-week low. However, the US Department of Energy announced that last week's EIA crude oil inventory increase was lower than expected, and last week's gasoline demand surpassed 2022 seasonal levels for the first time in more than a month. After the EIA data was released, crude oil narrowed its decline by more than half and reached a new high. Prospects for interest rate cuts, which are expected to stimulate demand in the oil market, were hurt. After the release of the Federal Reserve minutes, the decline in crude oil widened again, US oil hit a one-week low, and the oil had fallen nearly 2%.
S&P, NASDAQ, and Google fell to record highs after Microsoft achieved new high results, and Pinduoduo surged back down, and China's PV stocks rose more than 10%
The three major US stock indexes have fluctuated slightly since opening. The Dow Jones Industrial Average, which opened slightly lower, and the S&P 500 index, which fell 0.1% at the beginning of the session, turned slightly higher more than once. Later, S&P fell slightly. The Dow dropped more than 70 points and fell nearly 0.2% in early trading. The Nasdaq Composite Index, which opened slightly higher, rose more than 0.1% in early trading and fell slightly after turning down in midday trading. After the release of the Federal Reserve minutes at noon, the decline of the three major indices rapidly widened and reached new daily lows. The NASDAQ fell more than 0.7%, the S&P fell nearly 0.7%, and the Dow fell more than 310 points and nearly 0.8%.
In the end, the three major indices collectively closed down for the first time this week. The Dow, which rebounded on Tuesday, closed down 201.95 points, or 0.51%, the biggest daily decline since April 30, at 39671.04 points, breaking the closing low since May 14. On Tuesday, S&P, which had a three-day high closing record, closed down 0.27% to 5307.01 points. The NASDAQ closed down 0.18% to 16801.54 points, which hit a record high for two consecutive days.
The S&P and Dow related ETFs SPDR S&P 500 ETF (SPY) and SPDR Dow Jones Industrial Average ETF (DIA) closed down 0.23% and 0.53% respectively. The former fell to record highs, while the latter closed to new lows since May 14.
The small-cap stock index Russell 2000, which is mainly value stocks, closed down 0.79%, outperforming the market for two consecutive days and falling to a low level since May 13. The tech-heavy Nasdaq 100 Index closed down 0.05%, the related ETF Invesco QQQ Trust Series 1 (QQQ) closed down 0.02%, and the NASDAQ Technology Market Capitalization Weighted Index (NDXTMC), which measures the performance of technology constituents in the NASDAQ 100 Index, basically closed down, all of which stabilized the historic closing levels set for two consecutive days.
Among the constituent stocks of the Dow Index, Dow Chemical, which closed down more than 2%, led the decline. Goldman Sachs and Amgen fell 1.7%. 3M, which fell nearly 2% on Tuesday, led the decline by 1.6%, and oil and gas giant Chevron fell 1.5%. Among the major sectors of the S&P 500, only healthcare, industrial, and IT, where Nvidia is located, closed higher, with an increase of no more than 0.2%. Energy fell by more than 1.8%, utilities fell nearly 1.2%, and materials fell by about 1%.
Including Microsoft, Apple, Nvidia, Google's parent company Alphabet, Amazon, Facebook's parent company Meta, and Tesla, the tech giants “Seven Sisters” had mixed ups and downs in early trading. Tesla, which opened low, fell nearly 4.5% in midday trading and closed down nearly 3.5%, falling from the closing high since April 29, which was set by a big rebound of nearly 6.7% on Tuesday.
Among the six major FAANMG technology stocks, Apple, which had risen slightly over 0.2% in early trading since January 26, turned down nearly 0.8% in early trading; Alphabet closed down 0.8% in a row, closing down 0.8%; breaking the closing record high for 5 consecutive days; Netflix, which has been rising for 3 consecutive days and has repeatedly refreshed its closing high since November 2021, closed down nearly 1.6%; while Microsoft turned up at the end of the session, closing more than 0.3% in the middle of the session, closing at a record high for 2 consecutive days; falling to a record low for 2 consecutive days since May 3 Meta rose more than 1% in early trading and closed up nearly 0.7% ; Amazon, which had been down for two consecutive days until its closing low since May 1, largely leveled off, taking back some of its gains in early trading.
Chip stocks generally rebounded. The Philadelphia Semiconductor Index and semiconductor industry ETF SOXX closed up about 1% and 1.2% respectively, breaking the closing high since March 7 set on Monday. Among chip stocks, Nvidia, which will announce financial reports after the market rose nearly 0.7% at the beginning of the market, quickly turned down. It fell nearly 1.3% and closed down 0.5% in early trading, and jumped rapidly after the after-market earnings report. The post-market increase expanded to more than 7%, and the stock price broke through the $1,000 mark for the first time in history; Analog Devices (ADI), which announced revenue and profit for the second fiscal quarter were higher than expected, closed up 10.9%; at the close, TSMC US stocks rose more than 1%, Qualcomm rose 1%, AMD rose 0.5%, while Intel fell 1%, and Micron Technology fell close to 1%, and Broadcom fell 1%. It fell 0.5%.
Most of the popular Chinese securities market continued to fall. The Nasdaq Golden Dragon China Index (HXC) maintained a downward trend after turning up in the short term at the beginning of the session, closing down nearly 1.2%. The related ETF Invesco Golden Dragon China ETF (PGJ) closed down 1.2%, falling for three or two consecutive days, breaking its closing low since May 10. KWEB and CQQQ closed down 1.3% and 0.3%, respectively.
Photovoltaic stocks generally rose, with Daxin Energy, Jinko Energy, and Artes Solar closing up more than 17%, 17%, and nearly 15% respectively. New car builders fell sharply. Extreme Krypton closed down 2%, and Ideal Auto fell 0.9%. Since the earnings report was released on Monday, NIO Auto closed down nearly 0.2%. Xiaopeng Auto, which closed up 6% after Tuesday's earnings report, rose nearly 2.9% at the beginning of the market, and fell 1.8% intraday after turning down in early trading, closing down more than 0.2%. Among other individual stocks, Pinduoduo, which announced its earnings report before the market, rose nearly 7.6% and closed up 1.1%. The market capitalization still surpassed Alibaba. At the close, Ali fell 4%, Baidu fell more than 2%, JD fell nearly 2%, Tencent Fandan fell nearly 0.9%, NetEase fell nearly 0.6%, and Station B rose nearly 1%.
Among the individual stocks that announced financial reports, Target (TGT), whose revenue for the first fiscal quarter was slightly higher than expected but fell 3% year over year, fell 10.1% at the beginning of the session, the biggest intraday decline since November 2022, closing 8%; after announcing that earnings and revenue for the first fiscal quarter fell 12.5%, but sales of its brand of the same name fell by 12.5%, the clothing and apparel fast fashion company Urban Outfitters (URBN) closed down 4.6%.
Editor/Jeffy