2023.11.27 21:42
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"Web Monday": US stocks fall, Amazon hits a 52-week high, US bond yields hover at a two-month low.

The market is waiting for the preliminary reading of the US GDP for the third quarter, which will be released on Wednesday, as well as the US PCE inflation data for October and the CPI data for the Eurozone on Thursday. In addition, market participants are also looking forward to Federal Reserve Chairman Powell's speech on Friday and the Fed's "Beige Book" on the economic conditions, in order to speculate on the interest rate path. Futures traders are betting that the Fed has completed its rate hikes and will not raise rates in December. The probability of a rate cut in March next year is about 23%, and the probability of at least a 25 basis point rate cut in May next year is as high as 50%. Goldman Sachs believes that the timing of the Fed's first rate cut is crucial and depends on employment data.

Market awaits the preliminary reading of US Q3 GDP on Wednesday, US October PCE inflation and Eurozone CPI data on Thursday, as well as Fed Chair Powell's speech on Friday and the Fed's Beige Book on the economic situation, in order to speculate on the interest rate path.

Futures traders are betting that the Fed has completed rate hikes, with no rate hike in December, and the probability of a rate cut of at least 25 basis points in March next year is about 23%, with a high probability of a rate cut of at least 25 basis points in May next year. Goldman Sachs said that when the Fed first cuts interest rates, employment data is crucial.

However, some media outlets have reported that the latest survey of economists shows that it is difficult for core inflation in the United States to cool down, and interest rates are expected to remain high for a long time. European Central Bank President Lagarde also stated that one cannot be complacent about the inflation situation in the Eurozone and that it is not yet possible to declare victory in the fight against inflation.

She also mentioned that the ECB may soon discuss whether to prematurely end the reinvestment of the principal of the 1.7 trillion euro emergency bond purchase program. The money market expects the ECB to cut interest rates by 90 basis points next year, with the highest probability of the first rate cut in April, although the bets have cooled compared to last week.

US new home sales in October exceeded expectations, falling to 679,000 households, a MoM decline of 5.6%, but an YoY increase of nearly 18%. The previous value for September was significantly revised downward, indicating a backlog of housing activity due to high interest rates. After the data was released, US bond yields hit a daily low.

"Black Friday" online sales in the US increased by 7.5% YoY to a record $9.8 billion, and Adobe Analytics raised its consumption expectations for "Cyber Monday" to $12 billion to $12.4 billion, also reaching a new high. Sales over the Thanksgiving weekend exceeded $10 billion.

US stocks fall together, Dow and S&P fall from nearly four-month highs, Nvidia falls for three consecutive days, e-commerce and retail stocks rise

On Monday, November 27, "Cyber Monday," the day of electronic product promotions following the Thanksgiving holiday in the United States, and the first day of the last trading week in November, the three major US stock indexes opened slightly lower collectively, after all having risen for four consecutive weeks.

At midday, the tech-heavy Nasdaq and Nasdaq 100 turned higher, and the S&P also briefly turned higher. Retail stocks such as Mercadolibre, Amazon, and Dollar Tree led the gains, with both consumer discretionary and technology sectors rising more than 0.6%. The Nasdaq turned lower towards the end of the session.

At the close, both the Dow and S&P halted their two-day rally, falling from their nearly four-month highs on August 7 and August 1, respectively. The Nasdaq fell for two consecutive days but remained close to the high reached last Monday on July 31. The Russell small-cap index halted its two-day rally and moved away from its two-month high since September 20:

The S&P 500 index fell 8.91 points, or 0.20%, to 4,550.43. The Dow Jones fell 56.68 points, or 0.16%, to 35,333.47. The Nasdaq fell 9.83 points, or 0.07%, to 14,241.02. The "fear index" VIX is still below 13, the lowest since January 17, 2020, reached last Friday. The Russell 2000 small-cap index fell 0.4%, the Nasdaq 100 fell 0.1%, and the Nasdaq Technology Market Cap Weighted Index (NDXTMC), which measures the performance of technology companies in the Nasdaq 100, fell 0.1%. It has fallen for two consecutive days to a one-week low, continuing to retreat from the historical high set last Monday.

US stocks fell across the board, with the Dow and S&P 500 falling from their highest levels in nearly four months, and the Nasdaq falling in the late session.

Tech stocks had mixed performance. "Metaverse" Meta fell 1%, reaching a one-week low along with Google A. Apple saw a slight decline but remained close to its three-and-a-half-month high. Amazon rose 0.7% to a 19-and-a-half-month high, while Microsoft rose 0.3% to a historical closing high. Netflix narrowed its initial decline of 0.9% and hovered near a 22-month high. Tesla fell 1.4% before rebounding by 0.3% for two consecutive days from a one-week low.

Chip stocks retreated in the late session, with the Philadelphia Semiconductor Index falling 0.2%. Intel's gains narrowed to 0.3%, approaching the 19-month high set last Monday. AMD's gains also narrowed to 0.3%, reaching a five-and-a-half-month high. Nvidia rose 1%, ending a three-day decline and moving away from a two-week low.

Most AI concept stocks rose, with C3.ai up 0.4% and SoundHound.ai up over 3%, both reaching one-week highs. BigBear.ai rose 1.6% to a one-and-a-half-week high, but Palantir Technologies fell 0.6%, extending its four-day decline and further moving away from a two-year high.

In terms of news, Tesla has sued the Swedish government, and the strike has spread to the country's postal department, with the union preventing the delivery of Tesla license plates. Cybertruck is scheduled to be delivered on December 1st. Microsoft initially fell 0.3% but rebounded, and the impact of personnel changes at OpenAI is gradually fading.

Popular Chinese concept indices followed the decline of the US stock market. The ETF KWEB fell 1.9%, CQQQ fell 0.4%, and the Nasdaq Golden Dragon China Index (HXC) fell 1.6%, ending its two-day rally and basically erasing the gains since last Wednesday.

Among the Nasdaq 100 constituents, JD.com fell 1.5%, Baidu rose 0.5%, and Pinduoduo fell 0.8%. Among other individual stocks, Alibaba fell over 1%, Tencent ADR fell 0.8%, and Bilibili fell over 3%. NIO fell nearly 3%, XPeng fell over 4%, and Li Auto fell 3.8%.

Kandi Technologies, which rose more than 14% in pre-market trading, closed up 2.5% and plans to repurchase up to $30 million worth of shares. DouYu, which has been embroiled in controversy due to CEO Chen Shaojie's alleged involvement in operating a casino, has established an interim management committee. In response to the inability to download some apps from the app store, it stated that it has not received any delisting notices and is investigating the cause. Its stock price fell 8.6%. Banking stocks hit a two-week low after two consecutive days of decline. The industry benchmark, the KBW Bank Index (BKX) on the Philadelphia Stock Exchange, fell by 0.6%, reaching its lowest level since September 2020. The KBW Nasdaq Regional Bank Index (KRX) also dropped by 0.5%, hitting its lowest level since November 2020. Some institutions have warned that regional banks with poor returns and profits are at the greatest risk of being acquired by competitors.

Other stocks with significant changes include:

On "Black Friday" and "Cyber Monday," U.S. e-commerce and retail stocks rose together. Walmart rose by 0.5% from a four-month low, eBay fell by 1.8% and closed down by 0.3%, consumer electronics giant Best Buy fell by 2% and closed down by 0.2%, all remaining not far from their one-month highs. Handicraft e-commerce platform Etsy rose by 3% to its highest level in nearly three months. Leading "buy now, pay later" company Affirm rose by nearly 16% to its highest level in 15 months. Canadian e-commerce company Shopify rose by nearly 5% to its highest level in 20 months, with a cumulative increase of 57% in November, the best monthly performance in history.

Albemarle, the largest lithium battery supplier for electric vehicles in the United States, fell by more than 8%, reaching its lowest level in two weeks after falling from its monthly high. It has fallen by about 44% this year due to the reluctance of American consumers to buy electric vehicles and the increase in inventory. The Global X Lithium & Battery Tech Industry ETF (LIT) also fell by more than 2%, hitting a two-week low.

The European Union warned that Amazon's acquisition of iRobot, the global leader in consumer robotics, would harm competition. iRobot fell by more than 20% and triggered several trading halts due to excessive volatility, eventually closing down by more than 17%, falling from its four-month high.

The HRTS Obesity ETF fell by 0.7%, with weight loss drug manufacturers such as Arena Pharmaceuticals falling by 1.4%, Bojian falling by 2%, Eli Lilly falling by 1.5%, and Novo Nordisk ADR falling by 1.5% and reaching a new low. Earlier reports stated that Novo Nordisk is considering flexible pricing for its "miracle weight loss drug" to lower the threshold for use.

European stocks fell across the board. The pan-European Stoxx 600 index closed down by 0.34%, ending its three-day winning streak and falling from its two-month high since September 20. Travel stocks fell by 0.8%, while oil and gas stocks erased earlier losses and traded flat. The Euro Stoxx 50 index fell by 0.4%, also ending its three-day winning streak and falling from its three-and-a-half-month high. Component stocks such as BASF and Bayer fell by more than 3%. However, European stocks are set to deliver their best performance since January. US Treasury yields rose and then fell back, with the 10-year bond yield dropping 8 basis points, returning to a two-month low.

The auction of two-year Treasury bonds by the US Department of the Treasury had a bid rate of 4.887%, weaker than the previous auction in October. The yield on two-year US Treasury bonds fell by nearly 7 basis points during the day, dropping below 4.90%, essentially erasing the gains since last Wednesday. The yield on 10-year bonds dropped more than 9 basis points to 4.38%, hovering at the two-month low since late September.

European bond yields also declined. The yield on the 10-year German benchmark bond in the eurozone fell more than 9 basis points at the close, hitting a daily low of 2.547%, moving away from the ten-day high of 2.663% reached last Friday. The yield on two-year bonds fell more than 7 basis points and dropped below 3%. The yield on Italian bonds, which have higher debt levels than peripheral countries, dropped by 11 basis points, while the yields on French and Spanish bonds fell more than 9 basis points.

The decline in European bond yields was mainly due to European Central Bank President Lagarde's statement that the reinvestment of the PEPP emergency bond purchase program will be discussed. UK bond yields also fell by more than 7 basis points in general. Bank of England Governor Bailey stated that the task of combating inflation in the "second half" is challenging and it is unlikely that interest rates will be lowered in the foreseeable future. However, positive inflation data has increased market expectations for a rate cut.

Oil prices fell nearly 2% during the day but narrowed their losses. Brent crude oil closed below the psychological level of $80 per barrel, while European and American natural gas prices also fell.

The market is waiting for the OPEC+ oil production meeting on Thursday. There are reports that Saudi Arabia is seeking to cut the production quotas of other OPEC+ countries. International oil prices narrowed their decline, and traders generally expect Saudi Arabia and Russia to voluntarily extend production cuts until early 2024.

January WTI crude oil futures fell by $0.68, or 0.90%, to $74.86 per barrel. The expiring January Brent crude oil futures fell by $0.60, or 0.74%, to $79.98 per barrel, falling below the psychological level of $80 per barrel.

WTI crude oil prices fell the most, dropping by $1.47 or 1.9%, hitting a daily low of $74 per barrel, and then rebounding to around $75 per barrel. The most active February futures for Brent crude oil fell by $1.39 or 1.7%, hitting a daily low of $79 per barrel, and then rebounding to the psychological level of $80 per barrel. Both reached their lowest levels since last Wednesday. Oil prices fell nearly 2% during the day, but the decline narrowed, and Brent crude oil closed below $80.

The European benchmark TTF Dutch natural gas futures fell more than 4%, erasing most of last Wednesday's gains. ICE UK futures fell 6%, and EU carbon prices hit a new low in over a year, dropping towards the 70 euro mark. US natural gas fell more than 4% and hit its lowest level since early October, as warmer weather forecasts weakened expectations for heating demand.

The US dollar hovered near a three-month low, offshore renminbi fell below 7.16 yuan, and Bitcoin fell below $37,000.

The US dollar index, which measures against six major currencies, fell 0.2% to 103.20, hovering near the lowest level in nearly three months since August 31. It has fallen more than 3% in November, marking the worst monthly performance in a year since November last year when it fell 5%.

The euro rose slightly against the US dollar and stabilized above 1.09, returning to a three-and-a-half-month high. The pound also stabilized above 1.26, reaching a three-month high, with a cumulative increase of about 3.8% in November, the largest monthly gain in a year.

The yen rose 0.6% against the US dollar and broke through 149, approaching the recovery of last Wednesday's decline. The Australian dollar reached a three-month high, and Bank of America predicts that the US dollar will weaken next year, leading to a rebound in the Australian dollar. The offshore renminbi fell below 7.16 yuan, down 170 points from the previous day's close, temporarily deviating from the four-month high.

Mainstream cryptocurrencies fell across the board. Bitcoin, the largest cryptocurrency by market capitalization, fell more than 1% and fell below the $37,000 mark, deviating from the highest level since April last year. The second-largest cryptocurrency, Ethereum, fell more than 3% and fell below $1,990, after rising above $2,100 at the beginning of the month to a seven-month high.

Gold rose above $2,010 to a six-month high, while London copper fell more than 0.7%, tin fell nearly 3.8%, and nickel hit a three-year low during the day.

The decline in the US dollar and US bond yields is positive for gold prices. COMEX December gold futures rose 0.47% to $2,012.40 per ounce. COMEX December silver futures rose 1.40% to $24.681 per ounce. Spot gold rose by 0.8%, not only continuing to hold above the psychological level of $2000, but also breaking through the $2010 mark, reaching its highest level in six months since mid-May. This is due to market speculation that the Federal Reserve has ended its rate hikes.

Previously, UBS pointed out that considering the Fed's potential interest rate cuts, the short-term decline in gold prices could be a good buying opportunity. It is predicted that gold prices will rise to a historical high of $2150 by the end of 2024.

The outlook for demand puts pressure on London industrial metals, causing a general decline. "Dr. Copper," an economic indicator, fell by 0.8%, falling below $8400 again after reaching a two-month high of $8486 last week. Some analysts believe that the 7% increase in copper prices since October 23 has triggered profit-taking.

London aluminum fell slightly to a one-week low. London zinc fell by 0.5%, erasing nearly half of last Wednesday's gains and moving away from a one-week high. London lead fell by 1.5% to a three-week low, further distancing itself from the highest level since May last year. London nickel fell below $16,000 to a three-year low, under pressure from global market oversupply and increased short positions. London tin fell by $900 or 3.8%, falling below $23,000 to the lowest level in over eight months.