Hot news

• Is the non-farm employment gloomy tonight? The 'hottest ticket' members of the Federal Reserve and Biden's chief economic advisor are both 'taking precautions'.

The October US non-farm employment report to be released this Friday may bring bad news to the labor market, with Fed governor Waller stating that the recent two hurricanes and Boeing's strike may lead to a decrease of over 0.1 million in employment growth population. Former Fed economist Sam, who proposed the 'Sam's Rule', said that taking into account the impact of hurricanes and strikes, in the worst case scenario, employment population could have negative growth, reducing by nearly 0.05 million.

• In September, the PCE showed an 'expected rebound', not affecting the expectation of gradual rate cuts.

In September, the PCE increased by 2.1% year-on-year, in line with expectations; the core PCE increased by 2.7% year-on-year, slightly exceeding expectations. According to CME's 'FedWatch' tool, after Thursday's inflation data was released, the probability of a 25 basis points rate cut in November exceeds 90%, and the likelihood of a further 25 basis points rate cut in December is also close to 70%.

• China and the USA Financial Working Group held its sixth meeting, and both sides communicated on topics such as the macroeconomic and financial situations of the two countries, monetary and financial policies, financial stability and regulation, capital markets.

During the International Monetary Fund and World Bank Annual Meeting in Washington, USA in October 2024, the China-USA Financial Working Group held its sixth meeting. The meeting was co-chaired by Xuan Changneng, Deputy Governor of the People's Bank of China, and Neiman, Assistant Secretary of the U.S. Treasury. Departments such as the China Banking Regulatory Commission, China Securities Regulatory Commission, State Administration of Foreign Exchange, as well as the Federal Reserve, U.S. Securities and Exchange Commission, Federal Deposit Insurance Corporation, among others, participated.

Both sides had a professional, pragmatic, frank, and constructive communication on financial policy issues of mutual concern, including the macroeconomic and financial situations of both countries, monetary and financial policies, financial stability and regulation, capital markets, anti-money laundering and counter-terrorism financing, and other financial policy topics. China introduced a package of policies supported by the financial regulatory authorities to promote stable economic growth, including two tools to support the stable development of capital markets, namely Securities, Funds, Insurance Companies, and Exchange Facilities (SFISF), and share buyback increased lending. China also expressed concerns to the United States on related issues.

• U.S. White House economic advisor Bernstein: Inflation is approaching the Federal Reserve's 2% target.

U.S. White House economic advisor Bernstein said that inflation is slowing, now approaching the Federal Reserve's 2% target; real wages are rising, the basic economic situation remains stable; the employment report may be distorted by the hurricanes that have occurred multiple times recently.

• U.S. 30-year mortgage rates rise to 6.72%, rising for the fifth consecutive week.

Freddie Mac announced on Thursday that the average level of 30-year fixed-rate mortgage loans is 6.72%, higher than the previous week's 6.54%, rising for the fifth consecutive week. The average rate for 30 years hit a two-year low of 6.08% in late September, and borrowing costs have steadily increased since then. For homebuyers who already find it difficult to afford housing, the rise in mortgage rates further weakens their purchasing power. The uncertainty of the U.S. presidential election results may also make some potential buyers adopt a wait-and-see attitude.

Gamestop's surge has dramatically narrowed, with the trading platform considering unplugging the internet of US retail investors.

• S&P Nasdaq sees the largest drop in nearly two months! Tech stocks all fell.

U.S. stock indexes collectively closed lower, with the Dow falling 0.9%, the Nasdaq falling 2.76%, the S&P 500 falling 1.86%, and the S&P Nasdaq witnessing the largest drop in nearly two months. Large tech stocks all fell, with Microsoft down over 6%, Meta down over 4%, Amazon and Tesla down over 3%, Apple and Google down nearly 2%.

Chip stocks fell across the board, with Arm down over 8%, Nvidia and Micron down over 4%, Broadcom and Intel down nearly 4%, Qualcomm down nearly 3%, and Taiwan Semiconductor down 2%.

China concept stocks were generally down, with the Nasdaq Golden Dragon Index falling by 1.3%, dropping 4.5% for the entire month of October. Li Auto fell by over 13%, NIO fell by over 4%, IQiyi fell by over 3%, and Tencent Music fell by over 2%.

• Apple's revenue for the fourth quarter slightly exceeded expectations, but revenue in Greater China fell short.

$Apple (AAPL.US)$ In the fourth quarter (ended September 28, 2024), revenue was $94.93 billion, a 6% year-on-year increase, analyst expectation was $94.36 billion. Revenue in Greater China for the fourth quarter was $15.03 billion, analyst expectation was $15.8 billion. iPhone revenue in Q4 was $46.22 billion, analyst expectation was $45.04 billion. iPad revenue was $6.95 billion, analyst expectation was $7.07 billion. Mac revenue was $7.74 billion, meeting analyst expectations. Sales of wearables, home, and accessories revenue was $9.04 billion, analyst expectation was $9.17 billion. Product revenue for Q4 was $69.96 billion, surpassing analyst expectations. Service revenue was $24.97 billion, analyst expectation was $25.27 billion. EPS for Q4 was $0.97, down from $1.46 in the same period last year. Apple initially dropped more than 2% after hours but narrowed the decline to within 2%.

• Amazon's Q3 profit far exceeded expectations, driven by accelerated cloud growth, with capital expenses expected to increase next year.

$Amazon (AMZN.US)$ In the third quarter, net sales were $158.9 billion, exceeding analyst expectations of $157.29 billion. Earnings per share for Q3 were $1.43, analyst expectation was $1.16. While revenue guidance for the holiday shopping season was slightly below expectations, the profit outlook remained positive, with record-high profit margins in the cloud business and overall operating margin. AWS reportedly generated over $100 billion in revenue over the past 12 months for the first time in history. Capital expenditures are expected to reach $75 billion this year, a 55% increase year-on-year, and potentially higher in 2025. Amazon rose nearly 6% after hours.

• Intel's revenue outlook for the fourth quarter is slightly higher than expected.

Intel's third-quarter revenue was $13.28 billion, analysts expected $13.02 billion; adjusted loss per share for the third quarter was $0.46, compared to earnings per share of $0.41 in the same period last year; Intel Foundry's third-quarter revenue was $4.35 billion, analysts expected $4.44 billion; Datacenter and AI revenue for the third quarter was $3.35 billion, analysts expected $3.15 billion; adjusted gross margin for the third quarter was 18%, analysts expected 38%; operating margin after adjustment in the third quarter was -17.8%, compared to 13.6% in the same period last year; projected revenue for the fourth quarter is expected to be $13.3 billion to $14.3 billion, analysts expect $13.63 billion; projected adjusted earnings per share for the fourth quarter are $0.12, analysts expected earnings per share of $0.06; estimated adjusted gross margin for the fourth quarter is 39.5%, analysts expected 38.7%. Intel soared nearly 7% after hours.

• OpenAI adds search functionality to ChatGPT, directly challenging Google.

OpenAI is adding new search functions to its flagship product ChatGPT, further upgrading the company's challenge to Google, owned by Alphabet. OpenAI announced on Thursday that the option called 'ChatGPT Search' will allow users to search for real-time information like on the web and get displayed news and other data sources. The company released a product prototype called SearchGPT in July, which is separate from the ChatGPT application and is only available to a few users. The new search feature uses OpenAI's 4o model and will first be available to paid ChatGPT Plus and Team users in mobile and web versions on Thursday. OpenAI's enterprise and educational customers will be able to use these features in the coming weeks, while free users will have access in the next few months.

• Guo Mingji: The possibility of super micro computer being suspended or delisted is increasing.

Renowned analyst Ming-Chi Kuo wrote that based on experience, the resignation of auditing firms is a serious signal, increasing the likelihood of scenarios like suspension or delisting. This will indirectly weaken Super Micro's competitiveness, posing a significant challenge to its survival, especially when its competitors are well-funded and resource-rich large manufacturers. While Super Micro's influence in the AI server industry has diminished (they are lagging behind Foxconn and Wistron in GB200 production by 3-6 months), the company still maintains a solid AI server design and manufacturing capability. If my analysis is correct, significant adjustments in the company's executive team or board of directors may occur. Further corporate integration is also a possibility, as seen in AMD's acquisition of ZT Systems. $Super Micro Computer (SMCI.US)$ Top analyst Ming-Chi Kuo wrote that based on experience, the resignation of the auditing firm is a serious signal, with an increasing possibility of the worst-case scenario of suspension or delisting. This will indirectly weaken Super Micro's competitiveness, posing a huge challenge to its survival, especially since its competitors are well-funded and resource-rich large manufacturers. Although Super Micro's influence in the AI server industry has weakened (they are behind Foxconn and Wistron by 3-6 months in GB200 production), the company still maintains a strong AI server design and manufacturing capability. If my analysis is correct, there may be major adjustments in the company's executive team or board of directors. Further corporate consolidation is also a possibility, with AMD's acquisition of ZT Systems being a precedent.

• "Metaverse first stock" Roblox's stock price surged nearly 20%, marking the largest increase since November 2023, with the company raising its annual booking forecast.

$Roblox (RBLX.US)$ In the third quarter, the booking volume exceeded analysts' expectations, reaching $1.1 billion, a 34% year-on-year increase. This achievement is attributed to the continuous growth of users and usage time, prompting the company to raise its full-year booking forecast for 2024. Looking ahead to the full year of 2024, Roblox has raised its revenue expectations, expecting operating income to be in the range of $3.55 billion to $3.57 billion, higher than the previous estimate of $3.49 billion to $3.54 billion. In contrast, analysts have a more bullish forecast for the full year, expecting it to reach $4.22 billion. The company's stock price closed up nearly 20%, marking the largest increase since November 2023.

BeiShui crazily bought China Mobile for nearly HKD 1.8 billion and sold Tencent for about HKD 200 million. On Monday (June 3rd), Southbound funds net purchased HKD 3.4 billion of Hong Kong stocks.

• Beishui increased its holdings in Xiaomi Group by over 0.6 billion Hong Kong dollars, bought Tencent for over 0.5 billion Hong Kong dollars, and sold Meituan for over 0.4 billion Hong Kong dollars.

On October 31 (Thursday), northbound funds net bought 2.683 billion Hong Kong dollars of Hong Kong stocks today.

$XIAOMI-W (01810.HK)$,$TENCENT (00700.HK)$,$GCL TECH (03800.HK)$Received net buyings of 0.66 billion HKD, 0.534 billion HKD, 0.237 billion HKD respectively;

$MEITUAN-W (03690.HK)$,$GEELY AUTO (00175.HK)$,$CNOOC (00883.HK)$Respectively suffered net sales of 0.427 billion Hong Kong dollars, 0.415 billion Hong Kong dollars, 0.247 billion Hong Kong dollars.

• Ideal Auto: Adjusted net income attributable to shareholders in the third quarter was 3.84 billion RMB, an 11% year-on-year increase.

$Li Auto (LI.US)$ In the third quarter, revenue was 42.9 billion RMB, a 24% year-on-year increase; adjusted net income attributable to shareholders was 3.84 billion RMB, an 11% year-on-year increase; delivery volume was 152,831 vehicles, a 45% year-on-year increase; adjusted earnings per ADS were 3.63 RMB, compared to 3.29 RMB in the same period last year. The gross margin for the third quarter of 2024 was 21.5%, while it was 22.0% in the third quarter of 2023 and 19.5% in the second quarter of 2024.

Ideal Auto expects vehicle deliveries in the fourth quarter of 2024 to be between 160,000 and 170,000 vehicles, a year-on-year increase of 21.4% to 29.0%; total revenue is expected to be between 43.2 billion RMB (6.2 billion USD) and 45.9 billion RMB (6.5 billion USD), a year-on-year increase of 3.5% to 10.0%. Ideal Auto fell more than 13% overnight.

The company's overall sales volume in 2023 was 18,000 kiloliters, with a year-on-year increase of 28.10%, indicating significant growth. In terms of product structure, the operating income of products worth 10-30 billion yuan were 401/1288/60 million yuan respectively.

Keywords: China's October Caixin Manufacturing PMI, USA's October seasonally adjusted non-farm employment population, October unemployment rate, October ISM Manufacturing PMI.

On Friday, in terms of economic data, China will release the Caixin Manufacturing PMI data for October, while the USA will announce a series of data for October, including seasonally adjusted non-farm payrolls, October unemployment rate, and October ISM Manufacturing PMI.

In terms of performance, in the US stock market$Chevron (CVX.US)$,$Exxon Mobil (XOM.US)$Will release financial report.

Regarding new listings, Hong Kong's new stock $TS LINES (02510.HK)$Listed in Hong Kong, a new stock in the US market$Heritage Distilling Holding Company, Inc (CASK.US)$will be listed.

Futubull Morning News:

There is a bias in everyone's subconscious: when giving advice to others, they think they are considering others, but in reality, they are acting in their own interests.
"- Charlie Munger"

Editor/Lambor