Source: Zhī Tōng Cái Jīng In 23, the company's overall sales volume was 18,000 kiloliters, a significant growth of +28.10% year-on-year. On the product structure, the operating income of 10-30 billion yuan products was 401/1288/60 million yuan respectively.
It seems that the "spring" for small cap stocks in the US has arrived.
Please use your Futubull account to access the feature.$Russell 2000 Index (.RUT.US)$After welcoming the news of the market's expectations of the Fed's interest rate cut last week and the Trump trade, small-cap stocks in the United States, an important index -$S&P 500 Index (.SPX.US)$have performed strongly recently and outperformed the large-cap index. Investors have begun to bet on the rotation of US stocks with real money: the demand for call options related to the Russell 2000 index has surged.
Wall Street's consensus on small-cap stocks is gradually emerging. On the basis of its bullish view on small-cap stocks, Wells Fargo & Co. and Morgan Stanley pointed out that financial and energy stocks, small growth stocks are expected to perform well. The Russell 2000 index has begun to fill up the gap and has outperformed large-cap stocks.
As the market heats up its expectations for the Fed's rate cut, lower interest rates may help to expand the market's gains. The rise of the US stock market in the first half of the year was mainly led by a few large-cap technology companies. Last week's heavy trading was undoubtedly focused on the performance of small-cap stocks in the US stock market, which once again outperformed the S&P 500 index, the main large-cap stock index, on Friday after last Thursday, among which Russell 2000 index, the small-cap benchmark, made the best weekly performance since 2024. Especially, small-cap stocks comprehensively outperformed the seven tech giants (Magnificent 7) that have led the entire US stock market since 2023 on Thursday and Friday.
This week, small-cap stocks continued to outperform large-cap stocks. Since the rebound last week, the index has broken through the trading range of more than two years. On Tuesday, the Russell 2000 index outperformed the S&P 500 index for the fourth consecutive trading day. On Tuesday, supported by the increasing bets on the rate cut scheduled to begin this year, US Treasury yields continued their downward trend, and the Russell 2000 small-cap index recorded five consecutive rises, up 3.5% on Tuesday. The cumulative increase in the past five trading days reached 12%, and the increase since the beginning of the year reached 11%. The Russell 2000 value index has risen 8.6% this year, and the Russell 2000 growth index has risen 14.9%. The S&P 500 index rose nearly 19% in 2024.$NVIDIA (NVDA.US)$Joint Chief Investment Strategist Matt Miskin of investment management company John Hancock stated that the lower interest rates may help those market sectors that have been affected by the soaring of large-cap technology stocks due to high interest rates. This includes small-cap companies, which are often more sensitive to interest rates because of their higher reliance on financing. "In many cases, small-cap companies need capital to survive, and rising funding costs pose a real challenge to their business. Lower funding costs will definitely help these companies," he said.
Investors are pouring real money into small-cap stocks, and the demand for call options related to the Russell 2000 index has surged. The Derivatives Market Intelligence Director Mandy Xu of Cboe Global Markets revealed that in the past few trading days, the demand for call options related to the Russell 2000 index and the ETFs tracking the index has surged, driving these contracts to trade at a premium relative to put options. This indicates that there may still be room for small-cap stocks to rebound in the short term. Xu pointed out that a similar pattern also appeared at the end of 2023 when investors pushed up stocks that were expected to benefit greatly from the Fed's major rate cut. FactSet data shows that the Russell 2000 index rose more than 20% from early November to early December last year, outperforming the S&P 500 index.
Lower rates may help those markets that have been affected by the surge of large-cap tech stocks, including small-cap companies, which are often more sensitive to interest rates because of their higher dependence on financing. According to Matt Miskin, co-chief investment strategist at investment management firm John Hancock, small-cap stocks may need funds to survive, and the rising cost of funds presents real challenges to their business. Lower funding costs will definitely help these companies.
Daniel Wantrobski, from Janney Montgomery Scott, stated that the biggest problem with the market trend on the previous trading day was whether it was a reversal of the trend of the past year and a half or just a test. He said:" As for the technical side, we will not confirm that yesterday's action is the beginning of a sustainable long-term trend. However, from a trading trend point of view, we do believe that we can see further trading themes rotating to small-cap stocks in the short term because the technical chart still shows the possibility of mean reversion."
Investors are pouring real money into small-cap stocks, and the demand for call options related to the Russell 2000 index has surged. The Derivatives Market Intelligence Director Mandy Xu of CBOE Global Markets revealed that in the past few trading days, the demand for call options related to the Russell 2000 index and the ETFs tracking the index has surged.
According to a statement issued by Intel on Tuesday, the company will sell 49% of the entities related to its Irish Fab 34 chip factory. Intel will retain 51% of its stake, thereby retaining control of the company, and the transaction is expected to be completed in the second quarter of 2024. This transaction will provide Intel with $11 billion in funding and provide more feasible space for its large-scale expansion plan.$Cboe Global Markets (CBOE.US)$revealed that in the past few trading days, the demand for call options related to the Russell 2000 index and the ETFs tracking the index has surged, driving these contracts to trade at a premium relative to put options.
FactSet data shows that the Russell 2000 index rose more than 20% from early November to early December last year, outperforming the S&P 500 index.$Nasdaq Composite Index (.IXIC.US)$.
Xu said, "We saw extreme bullish sentiment for small-cap stocks in the fourth quarter of last year, but that trade gradually faded as rate cut expectations diminished. Will this time be different?"
Call options give traders the right to buy underlying stocks or ETFs at a specified price before the option expires, while put options give traders the right to sell. Options contracts related to indices are usually settled in cash.
According to Dow Jones market data, the trading volume of call options related to the Russell 2000 index and the iShares Russell 2000 ETF reached the highest level in recent years last Thursday. Nearly 2.1 million call options related to the ETF changed hands that day, the highest daily trading volume since December 2009 and the sixth-highest since 2005. Trading volume in call options directly related to the index also reached its highest level since 2021.
Data shows that last Thursday was the best day for the Russell 2000 index since November last year. Demand for call options has remained high since then. Trading volume in call options related to the iShares ETF was still more than three times the daily average volume of the past two years on Friday and Monday.
U.S. small cap stocks are welcoming interest rate speculation, and Goldman Sachs advised investing in small growth stocks.
Morgan Stanley's U.S. stock strategist suggested that as the Fed may lower interest rates, investors should consider investing in small growth stocks. In a report released on Tuesday, Morgan Stanley's global research chief Katy Huberty said that the relative judgment of strategists on U.S. small-cap stocks shows that they are more inclined to increase shareholdings in growth stocks rather than value stocks.
Huberty said during a conference call, "As yields decline, small-cap growth stocks with a long-term outlook that are more sensitive to changes in the cost of capital are relatively beneficial, while small-cap stocks that are more sensitive to the economy (i.e., value stocks) are not."$Microsoft (MSFT.US)$According to Morgan Stanley strategists, the relative upside for trading small-cap growth stocks is greater due to the correction in yield. Huberty also said that history shows that when the Fed starts to lower interest rates, the performance of small-cap growth stocks usually outperforms. Biotech stocks are potential winners because the industry holds the largest weight in the Russell 2000 small cap stock index. She said that biotech "has a strong relative performance record" after the Fed starts lowering interest rates.
Last week, after June CPI data showed that the inflation rate further fell towards the Fed's 2% target, investors began to shift from large-cap tech stocks that dominate the S&P 500 index to small-cap stocks. Traders are currently digesting the possibility of at least two Fed rate cuts, rekindling the market theme of multiple rate cuts earlier this year.
Wells Fargo & Co.: Trump's trade boosts small-cap stocks, says small financial and energy stocks are the biggest beneficiaries. Wells Fargo Securities said Tuesday that the rise in small-cap stocks in the Russell 2000 index is boosted by the expectation of Trump's victory in the White House in November. Christopher Harvey, a stock analyst at Wells Fargo, said in a report on Tuesday that "political winds" are overwhelming concerns about corporate profits.
Monday was the first trading day after Trump was shot in Pennsylvania last Saturday. Harvey cited RealClear Politics' polling website as saying that after the incident, the possibility of Trump winning the presidency rose to a cycle high of 66% from 57% a week ago.
Harvey said that small financial and energy stocks are arguably the biggest beneficiaries of Trump's victory; for the heavily regulated industries such as finance and energy, this is a positive development that may shift the focus from earnings to valuation multiples.
He also added that Wells Fargo is monitoring the market's reaction to the ongoing second quarter earnings season. Currently, bad news for the company is seen as bad news. Our focus has shifted to determining whether political winds will cause investors to ignore recent bad news.
Although small-cap stocks began to rise last week and continued to rise after the bet that the Fed will start lowering interest rates in September due to the cooling of CPI in the U.S. in June, Harvey said that they believe that the spike in small-cap, value and cyclical stocks after the data release is a "short-term sudden rise" rather than the beginning of a sustained cycle in the market, because investors seem to remain skeptical about the profitability of general companies. Harvey said that the performance of small-cap stocks on Monday seemed "unrelated to the Fed/interest rate relationship and was more of a 'Trump trade'."
Editor / jayden