1. Microsoft and Apple alternately sit on the throne of 'global stock king'. This round ended with Microsoft slightly ahead on Monday. 2. The US Supreme Court agrees to hear the dispute over Nvidia's false financial statements. 3. Musk: Working on 'The Master Plan, Part IV'. 4. Gamestop's leader emphasizes the need to avoid 'hype', triggering a large drop in stock prices.
On the morning of June 18th, although the US stock market started off unstable, it quickly returned to the state of "the technology giants leading the market". Under this atmosphere, the three major indexes rose collectively, and the Nasdaq and S&P 500 index hit new historical highs again. On an ordinary trading day like this, the obvious decline of individual stocks such as Apple and Nvidia in the closing phase also laid an interesting foreshadowing for the next trading day.
As of the close of Monday local time, the S&P 500 index rose 0.77%, to 5473.27 points, marking the 30th time to hit a new historical high at close this year; the Nasdaq index rose 0.95%, to 17857.02 points, hitting new highs at the end of every day since last Monday; the Dow Jones Industrial Average rose 0.49%, to 38778.56 points.
(The S&P 500 index hit a new historical high of 30 times this year. Source: TradingView)
The two reasons that drive these tech giants to keep rising are nothing more than that the AI wave has not yet shown signs of exhaustion, and investors are becoming more and more confident that the Fed rate cut will land this year.
However, in the report released on Monday, Austin Pickle, an investment strategy analyst at Wells Fargo, mentioned something that made investors slightly unhappy -- looking at the history of the US stock market since 1974, the Fed's rate cut often marks the point where the S&P 500 index begins to fall.
(Source: Wells Fargo)
Of course, experienced investors can see the problem with this statistic at a glance: the Fed's rate cuts are often associated with economic crises and other events, and sharp declines in the US stock market are natural occurrences, such as the two market crashes in 2001 and 2007, where the rate-cut cycle in 2019 also coincided with the subsequent COVID-19 pandemic. Assuming that the timing of this round of rate-cut by the Fed has nothing to do with an economic recession, the performance of the stock market should be different.
For this reason, Michael Wilson and his team, a renowned strategy analyst at Morgan Stanley, believe that more and more stock performance is linked to a company's own growth prospects, and the impact of the Fed's rate cuts is becoming smaller and smaller.
Another highlight of Monday was the performance of the three big tech giants in the US stock market: Microsoft, Apple, and Nvidia. Among them, Microsoft and Apple alternated as the "global stock king," and ultimately, with Apple's market value of $3.32 trillion weakening in the late session, Microsoft ($3.33 trillion) regained the top spot by a narrow margin. Nvidia was even weaker, soaring to a new historical high intra-day, but a dive before the close caused it to end the day with a decline.
(Apple minute chart, source: TradingView)
Popular stocks performance
Most of the major US technology giants rose at the end of Monday, with Apple up 1.97%, Microsoft up 1.31%, Amazon up 0.22%, Meta up 0.49%, Google-A up 0.25%, Tesla up 5.3%, and Nvidia down 0.68%.
Chinese concept stocks performed flatly, with the Nasdaq Golden Dragon Index down 0.05%. Alibaba was up 1.64%, Baidu was down 0.63%, Pinduoduo was down 0.46%, JD.com was up 1.63%, NetEase was down 0.08%, NIO Inc was up 2.31%, Li Auto Inc was down 1.91%, and XPeng was up 1.81%.
Other news
[The US Supreme Court agrees to hear Nvidia's false statement dispute in financial statements]
The US Supreme Court made a decision on Monday to hear a case regarding investors accusing Nvidia and its management of misleading the market. The plaintiffs, investors from California, claimed that Nvidia and CEO Huang Renxun "intentionally" concealed the degree to which the company was dependent on the "mining" of the cryptocurrency in late 2018 before the stock price plummeted. The entire case had previously been dismissed by a district judge, and then the US Ninth Circuit Court of Appeals vacated the lower court's decision. Nvidia appealed to the US Supreme Court, and this is the latest development in response to that move.
[US ETF issuers prefer Nvidia over Apple]
The Invesco Technology Select Sector ETF (XLK) under Dow Jones Global Indexes will undergo quarterly weight adjustments after Friday's close. Due to the fund's limit on the proportion of stocks that hold positions of more than 5%, the quotas for Apple and NVIDIA will change significantly. Currently, Microsoft and Apple have a weight of about 22% each in XLK, while NVIDIA accounts for 6%. However, in this adjustment, NVIDIA will account for about 21%, and Microsoft will also account for about 21%, while Apple will only have around 4.5%. In terms of the size of this fund, a 15% change in positions means selling $10 billion worth of Apple stocks and buying an equivalent amount of NVIDIA stocks.
Musk: The Fourth Part of the Master Plan is being developed.
On Monday, Musk posted on social media that he is working on the "Fourth Part of the Master Plan" for Tesla, which he says will be epic. As a preface to this, Musk presented the "Third Part of the Master Plan" at Investor Day in March of last year, hoping to provide a viable solution for achieving a sustainable global energy economy through end-to-end electrification, sustainable power generation and storage.
(Source: X)
Thanks to some bullish rumors over the weekend, Tesla rose more than 5% on Monday. According to the schedule, Tesla's next major event will be the Robotaxi Conference in August. It is worth noting that even after Monday's increase, Tesla is still the worst-performing of the seven giants in the US stock market this year, with a drop of more than 24% since the beginning of the year.
Disney's new film "Deadpool and Wolverine" has been released in mainland China at the same time as North America.
Marvel Studios, owned by Disney, announced on Weibo on Monday that "Deadpool and Wolverine" will be released in mainland China at the same time as in North America on July 26. At the same time, the two lead actors, Ryan Reynolds and Hugh Jackman, as well as director Shawn Levy, will visit Shanghai on July 2 to kick off the global first-stop promotion.
Thanks to this news, as well as the record-breaking global animation box office weekend of "The Incredibles 2" last week, Disney rose 1.55% on Monday.
"GameStation" CEO Ryan Cohen stressed the need to avoid "hype" in the stock market at the company's shareholders' meeting on Monday. After Cohen's statement, GameStation fell 12.13% on Monday.
On Monday local time, well-known individual investors rallied to buy shares in GameStation, which held a shareholders' meeting, and CEO Ryan Cohen said he would focus on turning around the company which had fallen on hard times, while trying to avoid market hype. After his comments, Gamestation's shares fell 12.13% on Monday.