According to what the SmartFinance learned, the US stock market closed up 300 points or 0.77% on Thursday, the Dow Jones Industrial Average rose initially, while the S&P 500 index fell by 0.25% and the Nasdaq index fell by 0.79%. Exhausted buyers may have triggered the recent retracements.
The S&P 500 briefly exceeded 5500 points, a threshold that usually indicates excessive market expansion, but later retreated. Ambitious tech stocks driving this bull market came under pressure, as the Nasdaq 100 index fell after seven consecutive days of gains. Nvidia (NVDA.US) and Apple (AAPL.US) led the decline in the market, with Nvidia initially up 3.8% to a high during trading, and later plunging 8% from its peak, eventually closing down 3.5% and losing market capitalization to Microsoft. The Dow Jones industrial average performed well.
[US STOCKS] The Dow Jones index closed up 299.90 points, up 0.77% at 39134.76; the S&P 500 index closed down 12.86 points, or 0.23%, at 5474.17; the Nasdaq Composite index closed down 144.34 points, or 0.81%, at 17717.90. Nvidia fell 3.5% and Apple fell 2.1%. The Nasdaq Golden Dragon Index fell 1%, while Bilibili (BILI.US) rose 5.3%, rising for three consecutive trading days this week, with an accumulated increase of 15.7%, and Alibaba (BABA.US) fell slightly.
[EUROPEAN STOCKS] Major European stock indices rose, with the German DAX30 index up 1.03%, the UK FTSE100 index up 0.82%, the French CAC40 index up 1.34%, and the European Stoxx50 index up 1.27%.
[CRYPTOS] Bitcoin rose 0.2% to $65027.49/coin, while Ethereum fell 0.6% to $3531.58/coin.
[GOLD] COMEX August gold futures rose 1.07% to $2,372/ounce, while spot gold rose 1.3% to $2,358.98/ounce; COMEX July silver futures rose 3.99% to $30.74/ounce.
[CRUDE OIL] WTI July crude oil futures closed up $0.60, up over 0.73%, at $82.17/barrel. Brent August crude oil futures rose $0.64, up over 0.75%, to $85.71/barrel.
[METALS] London metals are generally up, with zinc down 0.02%, aluminum up 0.88%, copper up 1%, and nickel up slightly by 0.02%.
Macro news
Fed policymaker: need to clarify inflation path before cutting interest rates. Richmond Fed President Barkin said the Fed needs to further clarify the inflation path before cutting interest rates. Barkin, who has the right to vote on monetary policy this year, said that the policy stance is currently good and added that the Fed has the strength to restrain inflation. When asked if the Fed can cut interest rates once and maintain it at that level, Barkin said it depends on economic data. If the current situation persists, now may not be the best time to provide guidance on the timeline for subsequent policy adjustments. "Sometimes we want to provide forward-looking guidance and we do that," he said. "But right now, it doesn't seem like that time. Let's see where the data take us."
Economists say US housing slowdown increases likelihood of rate cuts. In a report, LPL Financial chief economist Jeffrey Roach said slowing housing construction would further ease price pressure on bulk commodities such as timber. May housing data released today fell below expectations, with new home starts down 5.5%. Roach said, "Soft demand and easing inflation should lead the Fed to cut rates later this year." He noted that data showed a slowdown in the housing component of second-quarter GDP.
Two large bets in the USA interest rate futures market suggest that the expectation of a rate cut in July will increase. The two large bets in the Federal Fund interest rate futures market have attracted attention on Wall Street because they run completely counter to the current market forecast for the timing of the rate cut. If the expectation of an early rate cut in July increases, these two bets will bring profits. So far, related positions are concentrated in the August Federal Fund interest rate futures contract. A transaction on Tuesday posed new risks to the Thursday market. The buyer bought interest rate futures contracts worth $55,000, which would affect $2.3 million with each basis point movement. This means that if the probability of a rate cut in July rises to 50%, the bettor can make a profit of about $28 million. There was a similar bulk transaction last week, which would affect $1.25 million with each basis point change. The total number of open contracts for August contracts is much higher than 400,000, at a historical high.
Six days of consecutive decline in the yen increase the risk of intervention. The yen is likely to experience its longest consecutive decline since March this year, and may close at a 34-year low, raising the risk that Japanese officials will once again take action to support the yen. On Thursday, the yen fell for the sixth consecutive trading day, marking the longest consecutive drop in three months. The USD/JPY is now near 159 and could fall to the year's low of 160.17. In April this year, the yen hit its lowest level in more than 30 years, and Japanese policy makers intervened. Barclays strategists led by Shinichiro Kadota wrote, "As long as the US-Japan interest rate differential exceeds a certain threshold, even if the differential narrows slightly, yen selling caused by arbitrage trading may not decrease." They currently expect the USD/JPY to trade around 160 by the end of this year.
Bank of America: The strong US dollar is expected to remain for a longer period of time. Bank of America economists said in a report that with the Federal Reserve turning to rate cuts, but at a slower pace than previously expected, the US dollar may maintain a certain degree of strength. They expect the euro-dollar to settle at 1.12 this year. Considering the continued inflation and a "mild easing cycle" in the US, Bank of America expects the euro-dollar to reach 1.17 by the end of 2025, previously predicted to be 1.20. Economists said they have a more bearish view on the US dollar than the market consensus.
[Individual stock news]
Huang Renxun again reduces his shareholding in NVIDIA (NVDA.US) stocks. According to documents submitted to the US Securities and Exchange Commission on June 20, local time, Huang Renxun, CEO of NVIDIA, applied to sell 120,000 shares of NVIDIA, worth $16.3 million. Prior to this, according to a report on Monday, Eastern Time, Huang Renxun reduced his shares by about $31 million under a pre-arranged trading plan. According to statistics compiled by Washington Service, executives and directors of NVIDIA have sold about 770,000 shares of NVIDIA, worth more than US$700 million so far this year.
It is rumored that Apple (AAPL.US) has negotiated with Chinese companies such as Baidu, Alibaba, Baichuan Intelligent, etc. regarding the localization of AI services. Apple is actively exploring opportunities for cooperation with local Chinese companies to promote its Apple Intelligent services in the Chinese market. Informed sources disclosed that Apple has contacted several Chinese companies, including Baidu, Alibaba, and artificial intelligence start-up company Baichuan Intelligent. This move by Apple may be in response to competitive pressure in the Chinese market, especially as local competitors have integrated AI features into their phones. According to data from market research company Counterpoint Research, Apple's market share in the Chinese smartphone market has fallen to third place, surpassed by two major domestic brands, so cooperation with local companies is especially important for Apple.
Gilead (GILD.US) achieves amazing experimental results with an AIDS prevention drug. On June 20th, local time, US biopharmaceutical company Gilead Science announced on its official website that its research and development of "Lenacapavir" showed 100% efficacy in the prevention of HIV. The latest results were from a third phase double-blind randomized study called "PURPOSE 1", which aimed to evaluate the safety and effectiveness of Lenacapavir and Descovy among more than 5,300 women aged 16-25 at 25 sites in South Africa and three sites in Uganda. The results showed that among the 2,134 women in the Lenacapavir group, there were no cases of HIV infection.
MicroStrategy (MSTR.US) issues bonds to raise funds and buy about $786 million worth of Bitcoin. MicroStrategy bought about 11,931 bitcoins between April 27th and June 19th with the proceeds from the sale of convertible notes. According to documents submitted to the US Securities and Exchange Commission on Thursday, this purchase increased the total number of bitcoins held by the company to 226,331, worth about $14.9 billion. Michael Saylor, chairman and co-founder of MicroStrategy, began buying Bitcoin in 2020 as a hedge against inflation and an alternative to holding cash. Since Saylor started buying bitcoins, the digital currency has risen by about 600%. The move to buy Bitcoin has boosted MicroStrategy's stock price, which has risen by over 1,000% since Saylor made the move.