Source: Wall Street News

New signs of economic weakness appear in the USA. In February, the Conference Board Consumer Confidence Index fell sharply to 98.3, below expectations and the previous value, marking the largest month-on-month decline in over three years. Among the five sub-indices, only the Consumer Present Situation Index showed improvement, while the labor market conditions indicator significantly worsened, with the expected inflation rate rising sharply to 6%, far exceeding the Federal Reserve's target of 2%. The expectation index has fallen below the 80 warning line that indicates a recession.

The market still expects that the U.S. economy will experience a painful period. Some analysts claim this has begun to shake the fundamental pillars of the U.S. economy over the past few years - the stability of consumer spending and the labor market. All of this calls into question the foundation of the strong U.S. economy in recent years. Expectations for interest rate cuts have slightly increased, with this year's anticipated cut up from less than two weeks ago at 25 basis points to 60 basis points.

Investors are seeking refuge in the yen, Swiss franc, and sovereign bonds. Bond prices in Europe and the USA rose across the board, while risk assets pulled back. The Magnificent 7 in the U.S. technology sector fell into a technical correction range, further exacerbating market pessimism. The cryptocurrency market's decline intensified, with Bitcoin dropping below $0.09 million to a three-month low, down about 20% from its historical peak.

In the Eurozone, British Prime Minister Sunak announced plans to increase defense spending to 2.5% of GDP by 2027, and consider further raising it to 3% in the next parliament, marking the largest increase in defense spending since the end of the Cold War. The British Pound rose by 0.33%, and European military industry concept stocks generally increased. Additionally, the Eurozone's fourth-quarter wage growth fell to 4.1%, indicating signs of economic slowdown, and expectations for interest rate cuts from the European Central Bank are heating up.

Due to escalating concerns about economic recession and the technical correction in the Magnificent 7, the Nasdaq led the decline, with NVIDIA and Palantir dropping about 3%, and Tesla plunging over 8%, with its market cap falling below $1 trillion. NVIDIA has underperformed the market this year, down over 5% cumulatively. The Dow initially turned to decline in the morning session but rose in the afternoon, closing up for two consecutive days, while some sectors remain resilient, with relatively strong performances in consumer goods and real estate sectors:

• The three major U.S. stock indexes moved in different directions. The S&P 500 Index closed down 0.47%. The Dow, closely related to the economic cycle, rose by 0.37%. The Nasdaq, heavy on technology stocks, fell 1.35%. The Nasdaq 100 closed down 1.24%. The Nasdaq Technology Market Value Weighted Index (NDXTMC), which measures the performance of Nasdaq 100 technology sector stocks, fell by 1.88%. The Russell 2000 small-cap index, which is more sensitive to economic cycles, fell by 0.38%. The fear index VIX rose by 2.21%, closing at 19.40.

• Most sector ETFs in the USA have declined. The Semiconductors Sector ETF fell by 2.12%, the Energy Sector ETF, Technology Sector ETF, Internet Stocks Index ETF, and Global Technology Stocks Index ETF all decreased by up to 1.44%, the GF CSI All-Share Index Consumer Discretionary ETF dropped by 0.52%, while the Regional Banks ETF and WP CSI Banks ETF gained up to 0.18%. The Medical Sector ETF rose by 0.86%, and the Daily Consumer Goods ETF increased by 1.42%. The S&P 500 Index Telecom Sector fell by 1.53%, the Energy Sector declined by 1.47%, the Information Technology/Technology Sector dropped by 1.37%, the Consumer Discretionary Sector fell by 0.84%, and the Real Estate Sector closed up by 1.14%.

  
  

• According to a recent report from Goldman Sachs, during the two weeks ending February 21, hedge funds pulled out of American technology and media stocks at the fastest rate in six months. By the end of February, the USA's seven tech giants fell into a technical correction Range, with Bloomberg's "Magnificent 7" Index dropping over 10% from its peak in December last year, leading to a total evaporation of $1.4 trillion in Market Cap for the seven companies. Bank of America’s well-known strategist Hartnett pointed out that as tech stocks adjust, investors are growing increasingly skeptical about the S&P 500 Index's upside potential and are more inclined towards international stocks.

• Only Amazon among the "Magnificent 7" managed to close with a gain. NVIDIA fell 2.8%, and media reports indicated a significant increase in NVIDIA's H20 chip orders due to a surge in demand for the low-cost AI model, DeepSeek. NVIDIA's GTC 2025 conference will hold China AI Day, with participation from ByteDance, Alibaba Cloud, Baidu, JD.com, Meituan, and others. Tesla fell 8.39% due to a 45% drop in European sales, with its Market Cap falling below $1 trillion. Additionally, Tesla is issuing software updates in batches for Chinese customers, launching city road Autopilot assistance. Google A fell 2.14%, Meta Platforms dropped 1.59%, Microsoft dropped 1.51%, while Amazon closed up 0.04%. Apple fell 0.02%, reaching a day high of $250 during the day when Cook spoke about the annual dividend.

• Chip stocks generally declined. The PHLX Semiconductor Index closed down 2.29%. The double long ETF for NVIDIA fell 5.58%. Intel closed down 5.27%. NanoMicro Semiconductor fell 17.3%, Wolfspeed fell 9.32%, Micron Technology fell 2.3%, Broadcom fell 2.59%, Taiwan Semiconductor ADR fell 1.19%, Qualcomm rose 0.07%.

• AI concept stocks generally fell. Oracle dropped 0.84%. Super Micro Computer fell 11.76%, after-hours briefly increased by 19%. The company submitted its 10-K report, stating that it has not taken any significant remedial actions. Dell Technologies fell 3.06%. BullFrog AI fell 7.12%, and AppLovin fell 8.13%. Palantir closed down 3.13%.

• China Concept Stocks rose and fell inconsistently. The Nasdaq Golden Dragon China Index closed up 0.58%. In ETFs, the FTSE China 3x Long ETF (YINN) closed up 3.17%, the "China Dragon" Roundhill China Dragons ETF (DRAG) closed up 2.55%, the China Technology Index ETF (CQQQ) closed up 0.8%, and the China Concept Internet Index ETF (KWEB) closed up 0.32%. The FTSE A50 futures index continued to rise in the overnight session, closing up 0.29% at 13236.000 points.

• Among popular China Concept Stocks, Li Auto closed up 13.2% after the official release of the first pure electric SUV – the Li Auto i8, continuing the MEGA design style. Xiaomi Group ADR closed up 7.68%, Vipshop closed up 6.39%, Xpeng Motors closed up 5.46%, Alibaba closed up 3.85%, Bilibili closed up 3.75%, and JD.com closed up 1.93%. Baidu closed up 1.31%, with Baidu and YY Live's acquisition confirmed, over 11 billion will be returned for AI research and development. Trip.com fell 11.38%.

• American rare earth, nuclear power, and uranium mining stocks generally fell, with media reports saying that Ukraine agreed to a mining agreement after the USA dropped its most stringent requirements. Rare Earth Metals concept stock MP Materials fell 2.93%, Energy Fuels fell 4.39%, NioCorp Developments fell 1.42%, nuclear power concept stock/uranium mining stock Oklo, in which Sam Altman holds shares, fell 5.9%, SMR fell 4.6%, DNN fell 4.52%, and Vistra fell 3.39%.

As the seven tech giants in the USA fell into a technical correction Range, European stocks retreated from early gains, ending slightly up. German stocks continued their earlier upward trend at the open but declined later, ultimately closing down 0.07%. Investors are focused on the defense budget outlook in Germany and the United Kingdom, with European Military Industry concept stocks generally rising.

• The pan-European STOXX 600 Index closed up 0.15%. The Eurozone STOXX 50 Index closed down 0.11%. The FTSE pan-European blue-chip 300 Index closed up 0.17%.

• The German DAX 30 Index closed down 0.07%. The France CAC 40 Index closed down 0.49%. The Italian FTSE MIB Index closed up 0.63%. The UK FTSE 100 Index closed up 0.11%. The Spain IBEX 35 Index closed up 0.8%.

• Among individual stocks, pharmaceutical giant Novo-Nordisk rose 3%. On Monday, American telemedicine company Hims & Hers stated in its earnings call that it may stop selling compounded semaglutide, a substitute similar to Novo-Nordisk's weight loss drugs Ozempic and Wegovy.

• In the sector, most European automotive manufacturing concept stocks rose, with BMW, Volkswagen, and Porsche rising by at least 2.5%. European military industry concept stocks generally rose, with ThyssenKrupp up 9.61%, and cumulative gains of 55.68% since trading ended on February 11. UK defense spending has significantly increased, and UK aerospace company BAE rose 4.67%, with analysts pointing out that BAE will be the biggest beneficiary of the UK's increased defense spending policy, as 26% of its sales come from the UK market. European chip concept stocks generally fell, with Soitec down 5.46%.
  

Economic data triggered concerns among investors, with yields in the US and Europe generally falling. The two-year US Treasury yield fell to its lowest level since last December, while medium to long-term US Treasury yields decreased by over 9 basis points, UK yields fell by more than 5 basis points, and German yields fell by at least 2 basis points.

• US Treasury: The benchmark 10-year US Treasury yield fell by 9.81 basis points, reporting at 4.3021%. The two-year US Treasury yield fell by 7.43 basis points, reporting at 4.1003%.

• The 10-year US Treasury rose to a yearly high, with TD Securities closing long positions to lock in profits. TD Securities believes there are four main reasons for the continued decline in US Treasury yields since mid-January: first, increasing concerns about the prospects for US economic growth; second, concerns regarding tariff policies and their economic impact; third, a warming market expectation for an early end to quantitative tightening policies; and fourth, a growing market expectation for the Federal Reserve to lower interest rates to a lower terminal level. Nevertheless, TD Bank still expressed a hope to avoid shorting to cope with the current policy uncertainties.

• European Bonds: At the end of the European market, the 10-year German Treasury yield fell by 2.0 basis points, reporting at 2.458%. The two-year German Treasury yield fell by 2.3 basis points. The 10-year UK Treasury yield fell by 5.5 basis points. The two-year UK Treasury yield fell by 5.4 basis points. The France 10-Year Treasury Notes Yield fell by 2.7 basis points, and the Italy 10-Year Treasury Notes Yield fell by 3.0 basis points.
  

Consumer confidence data has put pressure on the US dollar, causing the USD Index (DXY) to fall by 0.2%, approaching the two-month low set on Monday. Amid weak economic data and Tesla dragging down US Technology Giants, safe-haven assets have been favored, with the Japanese Yen and Swiss Franc rising about 0.5%, while high-risk currencies mostly weakened, with the Australian Dollar, New Zealand Dollar, and Canadian Dollar performing poorly:

• US Dollar: In late New York trading, the ICE Dollar Index fell by 0.25% to 106.324 points. The Bloomberg Dollar Index fell by 0.18% to 1284.97 points.

• Non-US Currencies: The Euro rose 0.46% against the US dollar to 1.0516, the British Pound rose 0.33% against the US dollar, and the US dollar fell 0.47% against the Swiss Franc; among commodity currencies, the Australian Dollar fell 0.10% against the US dollar, the New Zealand Dollar fell 0.13% against the US dollar, and the US dollar rose 0.40% against the Canadian Dollar.

• Japanese Yen: In late New York trading, the US dollar fell 0.48% against the Japanese Yen to 149.01 JPY, with an intra-day trading range of 150.30-148.57 JPY, fluctuating downward throughout the day.

• Offshore Renminbi: The offshore Renminbi (CNH) fell 17 points against the US dollar in late trading to 7.2549 yuan, with an overall trading range of 7.2703-7.2475 yuan for the day.

• Cryptos: The largest cryptocurrency by market cap, Bitcoin, fell 5.91% in late trading to 88435.00 USD, refreshing its daily low to 85820.00 USD at 23:36 Beijing time. The second-largest, Ethereum, fell 5.06% in late trading to 2505.50 USD.
  

Weakened by soft consumer confidence, market concerns about oil demand prospects, combined with potential peace negotiations in Russia, have led to a drop of more than 2% in oil prices, with US oil falling below 70 USD to a two-month low. Germany is discussing loosening regulations for the gas storage system, and European natural gas futures fell about 6%:

• US Oil: WTI April crude futures closed down 1.77 USD, falling more than 2.50%, priced at 68.93 USD per barrel.

• Brent Oil: April Brent crude oil futures closed down $1.76, falling over 2.35%, at $73.02 per barrel.

• Natural Gas: US March natural gas futures rose over 4.50%, closing at $4.1740 per million British thermal units. At the end of the European market, TTF benchmark Dutch natural gas futures fell 5.93%, at €44.400 per megawatt hour. ICE UK natural gas futures fell 6.50%, at 105.600 pence per kilocalorie.
  

Concerns about the trade war continue, and investors took profits after hitting a historical high on the previous trading day. Gold prices fell over 2% during the session to a low in more than a week, with spot gold dropping over 1.2%, briefly falling below $2890 but still supported above $2900. Recently, the Democratic Republic of the Congo implemented a ban on cobalt exports, leading to a rise of over 3% in London cobalt. Following steel and aluminum, the Trump administration may be preparing to impose tariffs on copper products imported into the USA, with New Copper rising over 3% at one point.

• Gold: COMEX gold futures fell 1.12%, closing at $2930.00 per ounce. Spot gold closed down 1.22%, at $2915.72 per ounce, remaining in a declining state throughout the day.

• Silver: COMEX silver futures fell 1.56%, closing at $32.090 per ounce. Spot silver closed down 1.84%, at $31.7515 per ounce.

• Most London industrial metals fell, with London zinc and tin closing down over 1%, while London cobalt rose over 3%: London copper closed down $93, at $9402 per ton. COMEX copper futures rose 2.45%, closing at $4.6215 per pound. London aluminum closed down $17, at $2638 per ton. London zinc closed down $39, at $2812 per ton. London lead closed up $4, at $1992 per ton. London nickel closed down $109, at $15336 per ton. London tin closed down $469, at $32775 per ton. London cobalt closed up $730, with an increase of nearly 3.39%, at $22280 per ton.
  

编辑/jayden