Source: Wall Street See
After more than a month, the S&P fell for two consecutive days, with only the Nasdaq closing up, Chinese concept stocks rising over 2% before ending nearly 1% higher, performing strongly throughout the day. Texas Instruments gave poor guidance and dropped more than 2% after hours, while Starbucks postponed its guidance and fell about 7% after hours. Pinduoduo rose over 8% at one point, while Tiger Brokers fell more than 13%. The 10-year Treasury yield briefly rose above 4.22%, a three-month high, the US dollar hit a two-and-a-half month high, the yen fell below 151, offshore renminbi recovered its losses at the close. Oil prices rose over 2%, spot gold approached $2749, and silver rose over 3% to a twelve-year high.
On Tuesday, October 22, the US stock market saw only the Nasdaq rising:
Only the Nasdaq saw a slight rise among the three major US indices. The S&P 500 fell by 2.78 points, a decrease of 0.05%, closing at 5851.20 points. The Dow, closely linked to the economic cycle, fell by 6.71 points, a decrease of 0.02%, closing at 42924.89 points. The Nasdaq, dominated by technology stocks, rose by 33.12 points, an increase of 0.18%, closing at 18573.13 points. The Nasdaq 100 Index rose by 0.11%. The Nasdaq Technology Market Capitalization Weighted Index (NDXTMC), which measures the performance of the Nasdaq 100 technology sector stocks, rose by 0.24%. The Russell 2000 Small-Cap Index, more sensitive to the economic cycle, fell by 0.37%. The VIX panic index fell by 0.93%, closing at 18.20.US Stock Industry ETFs closed mixed. Regional Banks ETF rose by over 1%, Banks ETF nearly 1%, Consumer Goods ETF rose by over 0.5%. However, Semiconductor ETF, Consumer Discretionary ETF, and Utilities ETF each fell by nearly 0.5%.
In terms of research strategy, in the global financial stability report released by the IMF on October 22, it warned that the uncertainty brought by the US election could trigger market turbulence, similar to the selling seen in August. Tobias Adrian, Head of the IMF's Monetary and Capital Markets Department, stated that the tense relationship between market optimism and high valuations, along with geopolitical backgrounds, could trigger further market shocks.
Chip stocks mostly declined. The Philadelphia Semiconductor Index fell by 0.47%, closing at 5190.70 points. The SOXX ETF in the industry fell by 0.37%; NVIDIA's leveraged ETF fell by 0.19%. AMD fell by 2.41%, Taiwan Semiconductor ADR fell by 1.72%, Intel fell by 1.93%, Broadcom fell by 0.34%, Micron Technology fell by 1.16%, Applied Materials fell by 0.79%, KLA Corp fell by 0.52%, while Qualcomm rose by 2.47%. The Qualcomm CEO said that within 5 years, everyone will have at least one smartphone with AI capabilities. Arm Holdings rose by 0.15%, ASML ADR rose by 0.95%.
Most AI concept stocks saw declines. BullFrog AI fell by 5.83%, SoundHound AI, an AI voice company owned by NVIDIA, fell by 2.23%, BigBear.ai fell by 1.16%, C3.ai fell by 1.29%, CrowdStrike fell by 0.34%, Dell Technologies fell by 3.85%, Snowflake fell by 3.4%, Super Micro Computer fell by 3.83%, Serve Robotics fell by 4.82%, while Oracle rose by 0.89%, and Palantir rose by 0.56%.
China concept stocks mostly rose while the NASDAQ Golden Dragon China Index closed up 0.94% at 6969.48 points. In the ETF sector, the Invesco China Technology ETF (CQQQ) rose by 1.12%, the KraneShares CSI China Internet ETF (KWEB) rose by 1.37%, the Direxion Daily FTSE China Bull 3X Shares ETF (YINN) rose by 2.15%, the Direxion Daily FTSE **** 3X Shares ETF (YANG) fell by 2.22%. The Roundhill Ball Metaverse ETF (DRAG) rose by 1.17%. The FTSE China A50 Index Futures continued trading up by 0.38% in the night session, closing at 13637.000 points.
In the popular China concept stocks, Tiger Brokers fell by 13.31%, New Oriental fell by 1.28%, Alibaba fell by 0.45%, NetEase fell by 0.31%, Vipshop fell by 0.14%, while Trip.com rose by 0.05%, Baidu rose by 0.39%, Tencent ADR rose by 0.74%, Mengniu Dairy ADR rose by 4.11%, Xpeng rose by 2.03%, Li Auto Inc. rose by 3.29%, NIO Inc. rose by 1.75%, Zeekr rose by 5.59%, JD.com rose by 1.69%, PDD Holdings rose by 2.92%, Fangdd Network rose by 2.46%, Bilibili rose by 1.34%, Meituan ADR rose by 3.24%, and Miniso rose by 5.11%.
Bank stocks saw a general increase. The Philadelphia Stock Exchange KBW Bank Index closed up 0.75% at 121.25 points. The Dow Jones KBW Regional Banking Index rose by 1.02% to 116.15 points. Morgan Stanley rose by 0.03%, Goldman Sachs rose by 0.1%, Barclays rose by 1.11%, Citigroup rose by 2.8%, UBS Group rose by 0.53%, and Bank of America rose by 1.29%.
Other key stocks: (1) McDonald's (MCD) fell over 9% in post-market trading due to a severe E. coli infection incident in various McDonald's locations in the U.S. The company announced that the E. coli infection incident is related to an onion supplier, and one-quarter pound burgers have been withdrawn from sale in affected areas, with plans to resolve supply issues in the coming weeks, and other products on the menu are not impacted by the incident. (2) Starbucks reported lower-than-expected revenue and earnings, temporarily holding off on releasing Q4 guidance, causing the stock price to drop by around 7% after hours. (3) Cryptocurrency concept stock Beyond (BYON) fell by 2.4% and announced layoffs of approximately 20%, with Chief Product Officer (CPO) Robinson being suspended for unknown reasons. (4) Photovoltaic inverter manufacturer Enphase saw a drop of over 10% in post-market trading as Q3 microinverter shipments were below expectations. (5) Non-AI chipmaker health indicators: Texas Instruments reported slightly better results in Q3 but a Q4 guidance that was below expectations, with the stock price initially dropping over 2% then rising over 4% in post-market trading. (6) Beauty consumer "red light", L’Oréal's Q3 sales fell short of market expectations, closing ADRs down by 3.92%. (7) Most solar stocks rose, as the U.S. expanded the range of 25% chip tax exemptions to include wafers, including solar wafers. Daqo New Energy ADR rose by 5.69%, JinkoSolar ADR rose by 4.51%, Canadian Solar rose by 0.55%, First Solar rose by 2.62%, and Enphase Energy, a photovoltaic inverter supplier, rose by 2%.
Federal Reserve officials successively poured cold water on rate cut expectations, emphasizing cautious rate cuts, increasing the likelihood that the Fed will cut rates only once this year. On Tuesday, U.S. Treasuries saw mixed movements, but the 10-year Treasury yield hovered around 4.2%, the highest level since the end of July, while the 2-year Treasury yield remained above 4%. The Fed's rate cut path may slow down, leading to a sell-off in global bond markets with most European bonds falling.
U.S. Bonds: At the end of the day, the yield on the benchmark 10-year U.S. Treasury rose by 0.21 basis points, closing at 4.1977%, trading in a range of 4.1639%-4.2176% during the day. The 2-year U.S. Treasury yield fell by 0.36 basis points, closing at 4.0282%, trading in a range of 4.0580%-4.0090% during the day.
Eurozone Bonds: At the end of the day, the 10-year German bund yield rose by 3.6 basis points, closing at 2.318%, hitting a daily low of 2.281% at 21:36 Beijing time (following the IMF's global economic outlook report release, and during early U.S. trading). The 2-year German bund yield fell by 0.4 basis points, closing at 2.177%, hitting a daily low of 2.120% at 21:49. The 10-year French bond yield rose by 3.3 basis points, the 10-year Italian bond yield rose by 4.9 basis points. The 10-year UK bond yield rose by 3.0 basis points, closing at 4.167%, with the 2-year yield rising by 2.3 basis points.
China announced a reduction in the benchmark loan interest rate on Monday, drawing market attention to signs of improving oil demand in China. Combined with the raging war in the Middle East, US oil rebounded for the second consecutive day this week, rising over 2% to stabilize above $72.
US oil: WTI November crude oil futures closed up $1.53, an increase of nearly 2.17%, at $72.09 per barrel. US oil rose by nearly 3% at its highest during midday trading on Wall Street, breaking through $72.60.
Brent oil: Brent December crude oil futures closed up $1.75, an increase of 2.35%, at $76.04 per barrel. Brent oil rose by over 2.7% at its highest during midday trading on Wall Street, surpassing $76.30.
In terms of research strategy, StoneX analyst Alex Hodes stated that stimulus measures may take some time to impact oil demand, but we may have already seen the demand bottom. Goldman Sachs analysts told clients on Monday that Chinese oil demand increased by approximately 0.1 million barrels per day last week, reaching a six-month high, partly due to China's industrial production and retail sales exceeding expectations.
Natural gas: NYMEX November natural gas futures fell by 0.04%, to $2.3110 per million British thermal units.
The US election and tensions in the Middle East have triggered a wave of safe-haven demand, combined with expectations of further interest rate cuts by global central banks. Spot gold rose nearly $2750, hitting a historical high, while spot silver continued to hit a twelve-year high:
Gold: COMEX December gold futures rose 0.87% to $2762.60 per ounce at the last trading session, hitting $2763.20 during the session, a historical high. Spot gold continued to rise, reaching a high of nearly 1.1% approaching the $2750 level, setting a new historical high at the end of the session, up 1.07% to $2748.88 per ounce.
Silver: COMEX December silver futures rose 3.12% at the last trading session, at $35.050 per ounce. Spot silver continued to rise, hitting a high of nearly 3.2% breaking above $34.90, up 3.11% at the end of the session, at $34.8590 per ounce, approaching the top of October 1, 2012, at $35.3650.
On the news front: Peter A. Grant, Vice President of Zaner Metals, believes that geopolitical tensions and uncertainty surrounding the US election have increased demand for safe-haven gold. He predicts that if tensions in the Middle East escalate, the gold price may reach $3000 by the end of the year, but more likely in the first quarter of next year. He also pointed out that the loose monetary policies of major central banks globally are also a factor supporting higher gold prices.
Most London industrial metals rose: London copper closed up $24 at $9583 per ton. London aluminum rose $38, up more than 1.46%, at $2634 per ton. London zinc rose $62, up over 2.01%, at $3138 per ton. London lead rose $12, at $2069 per ton. London nickel fell $389, down about 2.33%, at $16316 per ton. London tin fell $109 to $30907 per ton. London cobalt remained flat at $24300 per ton.
COMEX copper futures rose 0.57% to $4.3850 per pound.
Editor / jayden
