The economic recession haze dissipated, and the three major American stock indexes rose together overnight, and the Nasdaq rose more than 2%. The latest market expectations show that the probability of a 25 basis point rate cut in September has risen to 74%, and the US dollar and US bond yields have strengthened. The Biden administration announced the first batch of "drug procurement" negotiation results, with price reductions ranging from 38% to 79%. The largest US cosmetics retailer, which was built by Berkshire Hathaway, has surged.
On August 15th, Finance Association (Editor Shizheng Cheng) With the U.S. retail data exceeding expectations and the initial claims for unemployment benefits dropping to the lowest level since early July, the U.S. stocks, which swept away the haze of recession, returned to the state of rising together. The data of the past three days of this week roughly outlines a picture of " controllable inflation and relatively stable economy ", enough to encourage the market to further repair.
At the close, the S&P 500 index rose 1.61% to 5543.22 points; the Nasdaq index rose 2.34% to 17594.5 points; the Dow Jones Industrial Average rose 1.39% to 40563.06 points.
After rising for the sixth consecutive trading day, the Nasdaq and S&P 500 indexes have regained the "continuous plummeting" since August 1st. From a more positive perspective, after returning to 5500 points, the S&P 500 index is not far from its historical high of 5669.67 points.
(S&P 500 index, Nasdaq index daily chart, source: TradingView)
Also influenced by economic data, the market's expectation for the Fed's interest rate cut has further narrowed.
The latest "Federal Reserve observation" data before delivery showed that the probability of a 25 basis point interest rate cut in September has risen to 74%. Bond yields of different maturities have also risen to varying degrees, with the yield on 10-year US Treasury notes returning to above 3.9%. As the interest rate expectations fall, the US dollar has returned to strength - the US dollar/yen exchange rate, which has attracted much attention, has risen above 149 overnight.
(US dollar/yen exchange rate daily chart, source: TradingView)
Regarding the fluctuations of the past few days, Steve Sosnick, chief strategist at Interactive Brokers, commented: "Hard landing, soft landing, or bumpy landing? The market has entered the state of 'putting the mattress on the ground' (this is a line from the movie 'The Godfather', meaning to enter the state of battle).'"
Sosnick further stated: "But under these circumstances, it really doesn't matter how the economy is doing. If you are tired enough, you can fall asleep wherever you are. Similarly, if you are in the emotional state of fearing to miss the opportunity to get on the bus and chasing after the rise, you will buy stocks no matter what."
As this week comes to an end, the market's gaze is also beginning to look further ahead. Harry Harris, a U.S. presidential candidate, will give his first public speech on economic policy this Friday. The updated schedule of the Federal Reserve on Thursday showed that Powell will deliver a keynote speech at the Jackson Hole Conference on the following Friday (August 23).
Hot stocks rose and fell.
On Thursday, the market returned to the state of technology giants leading the rise. Apple rose 1.35%, Microsoft rose 1.18%, Amazon rose 4.4%, Meta rose 2.01%, Google-A rose 0.58%, Tesla rose 6.34%, Nvidia rose 4.05% , Intel rose 3.87%, AMD rose 4.7%.
Chinese concept stocks also active rebounded, and the NASDAQ Golden Dragon China Index rose 1.72%. Alibaba rose 0.09% after releasing its financial report, Baidu rose 2.61%, Pinduoduo rose 2.18%, JD.com rose 4.25%, Netease rose 2.7%, Nio rose 2.96%, Li Auto rose 2.13%, and Xpeng rose 2.40%.
Other news
The Biden administration announced the first batch of "drug procurement" negotiation results.
On Thursday (August 15th) local time, the Biden administration announced a "historic" agreement with pharmaceutical companies, and the negotiated new drug prices can save Medicare (federal health insurance) net savings of about $6 billion by 2026. In addition, the new drug price will save insured persons a self-payment of $1.5 billion.
Data released by the White House showed that the price reductions of the first 10 drugs included in the negotiations ranged from 38% to 79%. Among them, the largest price reduction was Merck's blood sugar lowering drug Sitagliptin (Januvia), which dropped from $527 per 30-day dose to $113. The monthly usage fee of Novo Nordisk's insulin injection pen Novorage was also reduced from $495 to $119.
(Source: White House Official Website)
Ulta Beauty, the largest beauty retailer in the United States, soared 11.17% at Thursday's close. Yesterday, Berkshire Hathaway's American stockholding report showed that it held 0.69 million shares of the company in the second quarter of this year.
Amazon will test Prime Air drones for delivery beyond visual line of sight in the United Kingdom.
The stock price of Walmart, which has been ranked first in Fortune magazine's Global 500 for 11 consecutive years, jumped 6.58% on Thursday, hitting a new historical high.
The UK regulatory agency announced that Amazon Prime Air delivery drones have been approved to test beyond visual line of sight (BVLOS) flights in the UK. These testing projects include Amazon's drone delivery service Prime Air, Airspection for inspection of offshore wind farms, and Project Lifeline for the transportation of medical supplies. As of Thursday's close, Amazon rose 4.4% under the strong performance of the overall market.
In the 13 weeks ended July 26th, the company recorded total revenue of $169.3 billion, up 4.8% year-on-year, and adjusted earnings per share of $0.67, up 9.8% year-on-year; the company also predicts revenue growth of between 3.25% to 4.25% in the next quarter.
Toyota is considering shifting to a full hybrid product lineup while gradually phasing out internal combustion engine cars. David Christ, Toyota's head of North American sales and marketing, told media that the company will evaluate the feasibility of full hybrid products on an annual basis.
Applied Materials released its financial report ending on July 28th after the market closed on Thursday, with revenue of $6.78 billion and earnings per share of $2.12, both surpassing expectations. The net income of the Semiconductor Systems Division was $4.924 billion, an increase of $248 million year-on-year. Looking ahead to the current quarter, Applied Materials expects earnings per share to be $2.18 and revenue to be $6.93 billion.
Following better than expected earnings announcements on Wednesday, Cisco will reduce its workforce by about 7%, or more than 6,300 jobs, while focusing its business on faster growing areas such as AI and cybersecurity.
The latest financial guidance from Applied Materials meets market expectations.
After Thursday's close, Applied Materials, the world's largest semiconductor manufacturing equipment and service provider, released its financial report as of July 28, with revenue of $6.78 billion and earnings per share of $2.12, both exceeding expectations. The net income of the semiconductor systems division was $4.924 billion, an increase of $0.248 billion year-on-year.
Looking at the current quarter, Applied Materials expects a median earnings per share of $2.18, slightly higher than the market's expected $2.15; and a median revenue of $6.93 billion, in line with market expectations.
Berkshire Hathaway's position reported during the second quarter of 2022 showed that it held 0.69 million shares in Ulta Beauty. At Thursday's close, Ulta Beauty, the largest beauty retailer in the United States, soared 11.17%.
Following better than expected earnings announcements on Wednesday, Cisco will reduce its workforce by about 7%, or more than 6,300 jobs, while focusing its business on faster growing areas such as AI and cybersecurity. The stock price of Cisco surged 6.8% on Thursday.