2023.11.29 21:44
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The S&P and Nasdaq both turned down, PDD's market value briefly surpassed Alibaba, Bilibili dropped by 11%, and short-term bond yields plunged again.

US third-quarter GDP revised to the fastest pace in nearly two years. The Federal Reserve's Beige Book confirmed that the economy and prices are slowing down simultaneously. Several Fed officials' speeches deepened market expectations of an economic soft landing and interest rate cuts in the first half of next year. The Nasdaq rose 1% during the day, and US stock indexes hovered around four-month highs, with November set to see the largest increase of the year. Tesla fell 1% before delivery, chip stocks rose, Chinese concept stocks index fell more than 1%, Bilibili fell 11%, and Meituan ADR fell 6.7%. The two-year US Treasury yield fell more than 10 basis points for two consecutive days, and the 10-year yield fell below 4.3% for the first time since September. The US dollar rebounded from a three-and-a-half-month low but is on track for its largest monthly decline in a year. Offshore renminbi rose to 7.11 yuan, the highest in nearly four months, before falling. Betting on interest rate cuts pushed gold to a seven-month high, with futures gold approaching $2070. Media reports suggest that OPEC+ is considering further production cuts of one million barrels per day, pushing oil prices up about 2% for two consecutive days to a two-week high.

US Q3 GDP second reading exceeded expectations, revised up to 5.2%, the fastest expansion rate since Q4 2021, while the YoY increase in the PCE price index was revised down to 2.8%, confirming a downward trend in inflation.

Futures traders are betting that the FOMC will not raise interest rates in the next two meetings, with the probability of a rate cut in March next year rising to 45%, and the probability of a rate cut in May next year approaching 80%. The market believes that the Fed will cut interest rates as many as four times next year, totaling 100 basis points.

Market expectations for the first rate cut by the Fed have been brought forward from June next year to May.

In the upcoming FOMC, Richmond Fed President Barkin said that if inflation does not continue to slow, he may consider raising interest rates, but he also said that if he is confident that inflation will fall back to 2%, a rate cut would be possible. Atlanta Fed President Bostic is more confident in an economic soft landing and predicts further decline in inflation. Cleveland Fed President Mester supports no rate hike in December.

The Fed's Beige Book states that economic activity in the United States has slowed since the last report was released, labor demand continues to ease, prices have eased to a large extent but remain high.

The market is waiting for Fed Chairman Powell's speech on Friday and October PCE inflation data on Thursday. Hedge fund Pershing Square founder Bill Ackman is betting on the Fed cutting rates as early as the first quarter of next year.

Germany, the largest economy in Europe, saw its harmonized CPI for November increase by 2.3% YoY, weaker than the expected 2.5% and the previous value of 3%, reaching the lowest level since June 2021. Inflation in Spain has also slowed, strengthening market expectations for the ECB to cut rates ahead of other central banks next year.

S&P 500 closes lower, Dow barely ends higher, chip stocks rise but large tech stocks fall, B 站 falls more than 11%

On Wednesday, November 29th, the three major US stock indexes opened higher, with the tech-heavy Nasdaq rising by about 1% at one point, and the Nasdaq Composite Index, which is market-cap weighted, reaching an all-time high during the session. The Dow Jones Industrial Average rose more than 140 points, and the Russell 2000 small-cap index rose 1.9%. However, the S&P and Nasdaq turned lower in the final minutes of trading.

At the close, the Dow rose for the second consecutive day, reaching its highest level since August 7th, but nearly erasing its gains for the day. The S&P 500 remained near its high since August 1st, and the Nasdaq remained near its high since July 31st. The Russell 2000 small-cap index fell for the second consecutive day but remained not far from its highest level in two months:

The S&P 500 index fell 4.31 points, or 0.09%, to 4550.58. The Dow Jones Industrial Average rose 13.44 points, or 0.04%, to 35430.42. The Nasdaq Composite Index fell 23.27 points, or 0.16%, to 14258.49. The "fear index" VIX rose more than 2% and approached 13, reaching its lowest level since January 17, 2020, last Friday at 12.45. The Russell 2000 small-cap index rose 0.6%, while the Nasdaq 100 fell 0.1%. The Nasdaq Technology Market Cap Weighted Index (NDXTMC), which measures the performance of technology companies in the Nasdaq 100, saw a slight decline but remained close to last Monday's historic closing high.

The S&P 500 and Dow Jones Industrial Average (DJIA) both closed with mixed results, with the S&P 500 barely up and the DJIA showing a slight increase. However, the Nasdaq Composite Index (Nasdaq) had a 1% intraday gain.

The DJIA has gained about 7.2% in November, marking its best monthly performance since October 2022. The S&P 500 has gained 8.5% in November, and the Nasdaq, which has gained 11%, is on track to achieve its best monthly performance since July 2022.

Cloud monitoring and analytics company Datadog had the largest increase in the Nasdaq 100, with a gain of over 40% this month. Pinduoduo and cybersecurity company Crowdstrike followed closely behind with gains of over 30%. Large-cap technology stocks, popular artificial intelligence stocks, and chip stocks all showed strong momentum, with AMD and Tesla gaining over 20%, and Intel, Nvidia, Apple, Meta, and Amazon all gaining over 10%. However, the energy sector was the only one to decline this month.

Star tech stocks fell together. "Metaverse" company Meta fell 2%, Google Class A fell 1.6%, Apple turned down 0.5%, and Amazon fell 0.5%, marking a two-day decline from their 19-month highs. Microsoft fell 1% and fell from its all-time high, while Netflix fell 0.4% but remained near its 22-month high. Tesla rose 2.4% but then fell 1% after a three-day rally, ending its six-week high.

However, chip stocks rose across the board. The Philadelphia Semiconductor Index rose nearly 1%, breaking away from its two-week low. Intel rose 1.6% to a 19-month high, AMD rose 1.5% to a five-and-a-half-month high, and Nvidia rose 0.7%, marking its second consecutive day of gains in the past six trading days.

AI concept stocks also rose, with C3.ai up nearly 2% and SoundHound.ai up nearly 1%, both reaching their highest levels in nearly three months. Palantir Technologies rose 0.7% after bouncing back from its two-and-a-half-week low for two days, but BigBear.ai fell more than 4%.

Popular Chinese concept indices followed the decline of the US stock market. The ETF KWEB fell 1.7%, CQQQ fell 1.3%, and the Nasdaq Golden Dragon China Index (HXC) fell 1.3%, marking a three-day decline to a one-and-a-half-week low, falling below 6,500 points.

Among the Nasdaq 100 constituents, JD.com fell 2.6%, Baidu fell 1.3%, and Pinduoduo rose nearly 2%. Among other individual stocks, Alibaba fell 2.7%, Tencent ADR fell 1.5%, and Bilibili fell 11%. NIO rose more than 4% but then fell 0.4%, XPeng fell 4%, Li Auto fell more than 5%, Meituan ADR fell 6.7%, and Weibo fell more than 3%. On the news front, NVIDIA CEO Jensen Huang stated that artificial intelligence will have "comparable competitiveness" with humans within five years. Several investment banks have raised their ratings and target prices for Pinduoduo, and the stock surged 18% yesterday due to positive earnings. At one point during Wednesday's trading session, Pinduoduo's market value surpassed that of Alibaba. Jack Ma made a rare statement on Alibaba's internal network, saying, "I firmly believe that Alibaba will change, Alibaba will improve." Bilibili's third-quarter revenue remained flat compared to the same period last year, but its adjusted net loss was halved. The company expects its full-year net revenue to be at the lower end of its guidance range. NIO and Geely have launched a battery swapping partnership, opening up the B-side battery swapping market. Prominent investor Duan Yongping announced on a community platform that he has repurchased Tencent shares. Meituan warned of a slowdown in growth in the fourth quarter and had its target price lowered by Citigroup and Morgan Stanley. Weibo plans to issue $300 million in convertible senior notes and its stock fell more than 11% after the US market closed.

Banking stocks rose nearly 2% and moved away from a two-week low. The industry benchmark, the KBW Bank Index (BKX) on the Philadelphia Stock Exchange, reached its highest level in three and a half months. At the end of October, it hit its lowest level since September 2020. The KBW Nasdaq Regional Banking Index (KRX) is also approaching a three-month high. On May 11, it hit its lowest level since November 2020. Jiaxin Wealth Management rose nearly 7%, marking its best performance in four months.

Other stocks with significant changes include:

Salesforce rose nearly 5% after hours. Its third-quarter revenue increased by 11% YoY to $8.72 billion, exceeding expectations for the upper end of the revenue guidance for the next quarter. Warren Buffett participated in the initial public offering of cloud computing infrastructure provider Snowflake, and its stock rose more than 10% after hours. Both the third-quarter and full-year revenue guidance exceeded expectations.

General Motors rose more than 9%, reaching its highest level in nearly two months after a five-day consecutive increase. The company launched a $10 billion accelerated stock repurchase plan, increased its 2024 dividend by 30%, and restored its performance guidance for this year. The latest labor agreement is expected to increase costs by $9.3 billion, equivalent to an increase of $575 per vehicle, and the six-week strike had an impact of $1.1 billion on pre-tax profits. Stellantis' European and US stocks rose more than 5%.

Data infrastructure company NetApp reached a 21-month high with a gain of over 14%, CrowdStrike reached a 19-month high with a gain of over 10%, and footwear retailer Foot Locker reached a six-month high with a 16% increase. Their earnings reports exceeded expectations, and their profit guidance was raised. However, pet supply retailer Petco fell nearly 29% to a historic low due to poor third-quarter revenue and a loss per share, while the market had expected earnings per share.

There are reports that US health insurance giant Cigna is in talks to merge with Humana, causing their stock prices to fall by more than 8% and more than 5%, respectively. Activist investor Elliott Investment Management invested $1 billion in US refining company Phillips 66, seeking up to two board seats to drive business improvement. Phillips 66 rose 3.6% to a two-month high. Retail investors are once again betting on the future rise of Game Station's 'Retail Investor Holding' game, with the stock rising over 20% on Wednesday after a 13% increase on Tuesday. At one point during the trading session, the stock even rose by 30%, reaching its highest level in two months.

European stocks rose across the board, with the exception of the UK stock index, which saw a slight decline. The German and Italian stock indices both rose by over 1%, reaching their highest levels in nearly four months and approaching their highest levels since 2008. The pan-European Stoxx 600 index closed up 0.45%, approaching its highest level in two months since September 20, with automotive stocks rising by over 2% and interest rate-sensitive real estate and technology stocks rising by over 1.5%.

The two-year US Treasury yield has fallen by more than 10 basis points for two consecutive days, with the bond yield falling below 4.3% for the first time since September. Market expectations for significant interest rate cuts by central banks in Europe and the United States next year continue to rise, pushing European and American bond yields to multi-month lows. The two-year US Treasury yield, which is more sensitive to monetary policy, has fallen by more than 10 basis points for two consecutive days, with the deepest drop of 13 basis points on Wednesday, falling below 4.61% and reaching its lowest level in four and a half months since July 13. The 10-year bond yield has fallen below 4.3% for the first time since September, with the deepest drop of 8 basis points to 4.25% on the day, falling for three consecutive days to its lowest level in two and a half months since September 14.

German CPI data has strengthened the prospect of an interest rate cut by the European Central Bank, with the 10-year benchmark German bond yield falling by more than 6 basis points to 2.43% at the end of the day, reaching a three-month low, and the two-year yield falling by more than 8 basis points to a near six-month low. French, Italian, Spanish, and Greek bond yields all fell by 6 to 8 basis points, and the 10-year UK bond yield fell by about 8 basis points for three consecutive days.

Oil prices have risen by about 2% for two consecutive days to a two-week high, while European natural gas prices have fallen by over 7% to a seven-week low. Despite an increase in US crude oil and refined product inventories last week, supply disruptions caused by the Black Sea storm and news of a possible deepening of production cuts at the OPEC+ meeting on Thursday have pushed oil prices higher for two consecutive days. WTI January crude oil futures closed up $1.45, or nearly 1.90%, at $77.86 per barrel. Brent January futures closed up $1.42, or nearly 1.74%, at $83.10 per barrel.

US WTI crude oil rose by a maximum of $1.68 or 2.2%, briefly surpassing $78, rising for two consecutive days to a high of more than a week. Brent, which is more actively traded, rose by a maximum of $1.52 or 1.9% in February futures, reaching a high of $83 per barrel, its highest level in two weeks. Oil prices have risen by about 2% in the past two days, reaching a two-week high. OPEC+ is considering implementing new oil production cuts, with a potential reduction of up to 1 million barrels per day. The decision may be announced at the meeting on Thursday. If the OPEC+ meeting is further delayed due to negotiation difficulties, it may put downward pressure on oil prices.

Last week, US EIA commercial crude oil inventories increased by 1.61 million barrels, exceeding expectations for the sixth consecutive week. Gasoline inventories also increased by 1.76 million barrels, and refined oil inventories, including diesel and heating oil, increased by 5.21 million barrels.

However, a severe storm in the Black Sea region has disrupted daily oil exports of up to 2 million barrels from Kazakhstan and Russia, increasing the possibility of short-term supply tightness. Starting from Monday, the daily oil production of Kazakhstan's largest oil field will be reduced by 56%.

The European benchmark TTF Dutch natural gas futures fell by 7.3%, breaking below 40 euros per megawatt-hour, hitting a seven-week low since early October. ICE UK futures fell by nearly 7% and approached 100 pence per kilocalorie. The EU carbon tax has hit a new low for over a year for several consecutive days and fell towards the 70 euro mark. US natural gas prices fell by nearly 3%, hovering near a two-month low, as weather forecasts for warmer temperatures weakened expectations for heating demand.

The US dollar rebounded from its three-and-a-half-month low, with the offshore renminbi briefly approaching 7.11 yuan, the highest in nearly four months.

The US dollar index, which measures against six major currencies, rose above the 103 level, ending a four-day consecutive decline and reaching its highest level in three and a half months since August 11.

However, the US dollar index has fallen by 3.7% in November, making it the worst monthly performance in a year since a 5% decline in November last year, mainly due to the market's increasing expectations of a rate cut by the Federal Reserve in the first half of next year.

Inflation cooling off caused the euro to fall below 1.10, after breaking through this level for the first time since August yesterday. During the Asian session on Wednesday, it reached its highest level since August 10. The pound briefly rose above 1.27, reaching its highest level in three months since the end of August.

The yen against the US dollar briefly rose above 147, reaching a two-month high, and the intraday gain of US stocks narrowed to 147.30. The offshore renminbi briefly approached 7.11 yuan, the highest in nearly six months, with an increase of 200 points compared to the previous day's closing price. The intraday decline of US stocks caused it to return to 7.14 yuan. The New Zealand dollar rose by 1% to its highest level in nearly four months, as the country's central bank maintained interest rates at a 15-year high for the fourth consecutive time and warned of further rate hikes. Mainstream cryptocurrencies fall. The market value of the leading cryptocurrency, Bitcoin, fell more than 1% and dropped below the $38,000 mark, the lowest in 19 months since April last year. The second-largest cryptocurrency, Ethereum, fell nearly 2% and dropped below $2,030, after reaching a seven-month high of over $2,100 earlier this month.

Bitcoin falls more than 1% and drops below $38,000

Rate cut bets push gold to a seven-month high, with futures approaching $2,070 and nickel rising more than 2% to break free from a three-year low

Market speculation that the Federal Reserve has completed interest rate hikes, coupled with a decline in the US dollar and US bond yields, has been favorable for gold prices.

COMEX February gold futures rose 0.33% to $2,067.10 per ounce, marking a five-day consecutive increase to the highest level in over six months since early May. COMEX March silver futures rose 0.56% to $25.443 per ounce, reaching a three-month high.

Spot gold rose as much as 0.5% and briefly broke through the $2,050 mark, marking a five-day consecutive increase to the highest level in nearly seven months since early May, and approaching the historical high of over $2,080. UBS expects gold prices to rise to $2,150 next year, reaching a new high.

Gold holds steady at a seven-month high and continues to approach the historical high

Affected by the earlier rebound of the US dollar, most London industrial metals closed lower. The economic indicator "Dr. Copper" fell 0.7% but remained above the $8,400 mark, after reaching a two-month high of $8,486 last week.

London zinc fell 1.4% and approached $2,500, while London aluminum remained at a one-week low. London lead moved further away from the highest level since May last year. Nickel, which rose more than 4% yesterday, continued to rise more than 2% and rebounded from a three-year low to surpass $17,000. Tin rose for the second consecutive day from an eight-month low.

In addition, Shanghai nickel rose more than 3% for two consecutive days in the night session, stainless steel rose more than 1.2% for two consecutive days, but aluminum oxide fell more than 1.2%. Data shows that LME nickel prices have fallen by 43% and Shanghai nickel prices have fallen by 36% since the beginning of this year, making them the worst-performing base metals on both exchanges.