2024.02.12 23:47
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Chip stocks pause before CPI, SPDR S&P 500 bids farewell to record highs, NVIDIA still hits new highs, Chinese concept stocks start the Year of the Dragon with a bang

The S&P 500 and Nasdaq ended their four-day winning streak, while the Dow rebounded to a new all-time high. Chip stocks fell from their historical highs during intraday trading, with Nvidia initially rising over 3% and surpassing Amazon in market value before turning downward. Arm surged over 40% in early trading and closed with a 29% gain. European chip stock ASML hit a new all-time high for the eighth consecutive day. AI concept stock C3.ai rose over 9%, SMIC rose over 4%, and Chinese concept stocks rose over 2%. XPeng rose nearly 4%, while Pinduoduo and Bilibili rose over 3%. Nio and JD.com rose over 2%, and Bitcoin mining giant Canaan Technology surged nearly 17%. After the announcement of record-low mid-term inflation expectations among consumers, the two-year US Treasury yield approached its highest level since the December Fed meeting before declining. The US dollar index approached a three-month high before turning downward. Offshore renminbi fell below 7.22 to a three-week low during intraday trading before rebounding by over 100 points. Bitcoin surged over $2,000 during intraday trading, breaking through $50,000 for the first time in over two years. US oil extended its six-day winning streak, reaching a two-week high and the longest consecutive daily gain in five months, while Brent oil ended its five-day winning streak. Gold fell for the third consecutive day to a two-week low. The FTSE 100 rose over 3% to a six-month high, while London copper and zinc halted their three-day decline.

Investors are eagerly awaiting the release of heavyweight economic data such as the US CPI this week, as well as a series of speeches by Federal Reserve officials. The momentum of chip stocks has temporarily paused, and the overall US stock market, which has been rising for a month, saw a decrease on Monday, with the Pro UltrPro Shrt S&Pro 500 falling from its record high. After the news over the weekend that NVIDIA plans to enter the custom cloud computing chip business, including AI processors, the stock price reached a new all-time high, surpassing Amazon in market value for the first time in 20 years. However, it later retreated from the high and even briefly turned negative, giving back most of its intraday gains by the close. On the other hand, Chinese concept stocks, which ended the Year of the Rabbit on a high note last Friday, performed even better, welcoming the Year of the Dragon with a strong start.

As of last week, major stock indices have risen for five consecutive weeks. The Pro UltrPro Shrt S&Pro 500 set a record for the fastest breakthrough of the 1,000-point mark and recorded the best consecutive gain since 1972. The price-earnings ratio is now approaching the peak level of the previous bull market. Some investors who have missed out believe that a pullback is inevitable. Some commentators have pointed out that the Pro UltrPro Shrt S&Pro 500 has surpassed the overbought level on the technical side, prompting some investors to believe that it will at least enter a consolidation phase.

Two waves of decline in zero-day-to-expiration options (0DTE) triggered a market retreat.

Before the release of the US CPI on Tuesday, US Treasury yields collectively fell and prices rebounded during the European stock market session on Monday. In the early trading session of US stocks, the New York Fed announced that the consumer's three-year inflation expectations hit a record low. The US bond yields accelerated their rise during the trading session, with the benchmark 10-year Treasury yield and the two-year Treasury yield, which is sensitive to interest rates, approaching the high since the December Fed interest rate meeting. However, the upward trend did not last, and US stocks rose and then fell during the trading session.

In the foreign exchange market, after the announcement of the US consumer's medium-term inflation expectations, the US dollar index extended its gains, approaching the high of nearly three months ago. However, it later turned negative. Commentators pointed out that the US dollar entered a consolidation phase before the release of the CPI. After the strong non-farm payroll data released earlier this month, the market has already anticipated that the Fed is becoming less likely to cut interest rates in March, and it is expected that a rate cut is relatively more likely in May. Bitcoin, which rose more than 10% last week, continued to rise, surpassing not only the high set when the US regulatory authorities approved the listing of Bitcoin spot ETF in January, but also breaking through the $5 trillion market cap mark for the first time in over two years. In the commodity market, international crude oil initially erased nearly a 2% decline during intraday trading. Brent crude oil ended slightly lower, while WTI crude oil rose slightly, continuing to hit the highest closing level since the end of January and achieving the longest consecutive daily gains in five months. Commentators believe that concerns about demand have offset the impact of the tense situation in the Middle East. According to CCTV, Houthi rebels in Yemen claimed on Monday local time that they had launched multiple missiles at a US ship in the Red Sea. On the same day, Saudi Energy Minister Abdulaziz bin Salman stated that Saudi Arabia had earlier notified Saudi Aramco to stop expanding production capacity in order to transition to clean energy. He said that Saudi Arabia has a large amount of idle capacity to buffer the oil market. Saudi Aramco CEO Amin Nasser stated that the company is still prepared to increase production capacity if necessary, with approximately 3 million barrels of spare capacity.

In the US stock market, the three major indices had mixed performance in early trading but overall rose later. The ProShares UltraPro Short S&P 500, which opened slightly higher, experienced slight intraday declines multiple times. The Nasdaq Composite Index, which opened slightly higher, also experienced intraday declines several times before shaking off the downward trend about an hour after the market opened. At the end of the morning session, the ProShares UltraPro Short S&P 500 rose by over 0.4% and the Nasdaq rose by nearly 0.6%. However, they failed to rebound after a midday decline. At the lowest point of the day, the ProShares UltraPro Short S&P 500 fell by nearly 0.2% and the Nasdaq fell by nearly 0.5%. The Dow Jones Industrial Average, which opened slightly lower, turned higher in the early session and maintained its upward trend. At the high point of the midday session, it rose by over 250 points, or nearly 0.7%.

In the end, only the Dow Jones closed higher, rising by 125.69 points or 0.33% to 38,797.38 points, erasing the decline from the three consecutive gains last Friday and setting a new closing record high, marking the fourth consecutive trading day to achieve a new all-time high. The ProShares UltraPro Short S&P 500 and the Nasdaq, which had risen for four consecutive days, fell back. The ProShares UltraPro Short S&P 500, which had set a new closing record high for four consecutive days, fell by 0.09% to 5,021.84 points. After breaking through the 5,000-point mark for the first time in history last Friday, it closed above 5,000 points for two consecutive days. The Nasdaq, which had set a new closing high since November 22, 2021, fell by 0.3% to 15,942.55 points.

Value stocks, mainly small-cap stocks represented by the Russell 2000, rose by 1.75%, outperforming the broader market and achieving a new closing high since December 28, 2023, for three consecutive days. The tech-heavy Nasdaq 100 Index initially fell during the midday session and closed down by 0.44%. The Nasdaq Technology Market Cap Weighted Index (NDXTMC), which measures the performance of technology stocks in the Nasdaq 100 Index, also declined.

The ProShares UltraPro Short S&P 500 futures also turned lower during intraday trading.

In terms of individual stocks, NVIDIA's market value briefly surpassed that of Amazon. AI concept stocks and Chinese concept stocks outperformed the broader market. The market fell after a midday decline, closing down 0.61%, marking a three-day consecutive drop from the record high.

Overall, chip stocks retreated after three consecutive days of gains. The Philadelphia Semiconductor Index and the Semiconductor Industry ETF SOXX both rose nearly 1.7% in early trading, but fell in the midday session, closing down nearly 0.2%, dropping from the record high set last Friday. NVIDIA, which has challenged Broadcom in the custom data center chip business, saw its stock price rise over 1% in early trading, surpassing Amazon in market value. It reached a high of $746.11 in early trading, continuing to set new intraday highs, with a daily gain of over 3.4%. However, it later retreated during the midday session, closing up nearly 0.2%, marking two consecutive trading days of record highs. Arm, which has risen over 60% since the release of its excellent financial report last week, continued to surge, rising 42.3% in early trading and closing up 29.3%. It has accumulated a gain of over 90% in the past three trading days. At the close, Broadcom fell over 1%, while Intel and Qualcomm rose over 1%.

As of Monday's close, Arm has risen over 90% in the three days since the release of its financial report.

Most leading technology stocks retreated. Tesla, which had risen for four consecutive days since January 24th, initially rose in early trading, up 0.6%, but then fell and the decline widened, closing down nearly 3%.

Among the six major FAANMG technology stocks, Microsoft, which had set three consecutive record highs at the close last Friday, fell nearly 1.3%. Amazon, which rebounded to a two-year high last Friday, initially rose but then fell, closing down 1.2%. Apple, which had a slight rebound last Friday, closed down 0.9%. Alphabet, the parent company of Google, which pledged to provide 25 million euros to help Europeans learn to use AI, closed down 1%. Netflix, which rebounded to a high since February 1st last Friday, rose over 1% in early trading but closed down 0.6%. Meta, the parent company of Facebook, which had two consecutive positive days last Friday, initially rose over 2% in early trading, closing up nearly 0.2%, approaching the record high set after the release of its financial report two weeks ago.

NVIDIA's market value surpassed Amazon at one point during the trading session.

Most AI concept stocks continued to rise and outperformed the broader market. At the close, Super Micro Computer (SMCI), which had risen over 9% during the session, closed up 4.4%, marking six consecutive days of record highs. C3.ai (AI) rose over 9%, BigBear.ai (BBAI) rose nearly 6%, SoundHound.ai (SOUN) rose nearly 4%, Palantir (PLTR) rose nearly 3%, while Adobe (ADBE) fell over 2%. AI Chip Benchmark NVIDIA rose more than 3% in early trading and briefly fell in the afternoon. AI concept stock SMCI closed up more than 4%.

Overall, popular Chinese concept stocks continued to rise, outperforming the broader market. The Nasdaq Golden Dragon China Index (HXC) rose more than 3% in early trading and closed up nearly 2.1%. After a mid-day turnaround last Friday, it has closed at a high for two consecutive days since January 12. Chinese concept ETFs KWEB and CQQQ closed up 2.7% and 1.8% respectively. Two bitcoin mining giants, Canaan Inc. and Ebang International, closed up nearly 17% and nearly 8% respectively. However, the three new energy vehicle companies failed to continue their simultaneous rise. XPeng Motors rose more than 7% in early trading, Nio rose more than 5%, and Li Auto rose nearly 4% and about 2.5% respectively. Li Auto, which rose 2.5% in early trading, closed down nearly 0.8%. Among other individual stocks, at the close, Lufax Holding rose more than 7%, Dada Group rose more than 5%, DouYu rose more than 4%, Pinduoduo, Bilibili, and Kingsoft Cloud rose more than 3%, iQiyi rose nearly 3%, JD.com rose more than 2%, Alibaba, NetEase, and Tencent rose more than 1%, and Baidu rose nearly 1%.

Banking stocks continued to rise together. The overall banking industry index, KBW Bank Index (BKX), closed up nearly 1.6%, reaching a high for two consecutive days since January 31; the regional banking index, KBW Nasdaq Regional Banking Index (KRX), closed up 1.8%, and the regional banking ETF, SPDR Pro UltrPro Shrt S&Pro 500 Regional Banking ETF (KRE), closed up nearly 2.2%, all reaching a high for three consecutive days since January 31.

Among regional banks, New York Community Bancorp (NYCB), which rose nearly 17% last Friday, rose more than 1% in early trading and closed down 0.2%, failing to continue its rise after disclosing the purchase of over 200,000 shares by CEO and other executives last Friday. Western Alliance Bancorp (WAL) and Keycorp (KEY) closed up nearly 2%; Zions Bancorporation (ZION) closed up nearly 3%.

In terms of volatile individual stocks, Bitcoin drove up the prices of cryptocurrency concept stocks. MicroStrategy (MSTR) and Marathon Digital (MARA) closed up about 11% and 14% respectively. After announcing the acquisition of peer Endeavor for $26 billion, Diamondback Energy (FANG), a shale oil and gas producer, which will become the world's third-largest oil and gas giant, rose more than 10% in early trading and closed up 9.4%. Gilead Sciences (GILD), which agreed to acquire biopharmaceutical company CymaBay Therapeutics, rose 2% in early trading and closed up nearly 1.1%, while CymaBay (CBAY) closed up 25.4%. CEO disclosed the purchase of 65,000 shares of the company, and after the media reported that the founding family supports the activist investor Engaged Capital, clothing manufacturer VF Corp (VFC) rose 14%; Piper Sandler upgraded its rating from Neutral to Buy, believing that its brand portfolio and improved capital structure will benefit the P/E ratio rebound and expansion, resulting in a 7.5% increase in pharmaceutical company Teva Pharmaceutical (TEVA); while discount retailer Big Lots (BIG) fell 28% after Loop Capital downgraded its rating from Hold to Sell, citing deteriorating financial conditions and declining consumer awareness.

In European stocks, the pan-European stock index rebounded after several days of slight decline. The STOXX Europe 600 index reached a closing high since January 6, 2022. Major European national stock indices rose together, with the Italian stock index leading the gains, up nearly 1%, rising for three consecutive days and reaching a new closing high since June 2008. The German and French stock indices, which fell last week, rebounded, with the German stock index reaching a new closing high since last Tuesday, and the UK stock index rose slightly after three consecutive days of decline.

In various sectors, real estate rose nearly 1.5%, leading the gains, retail rose nearly 1.4%, and the technology sector, which led the gains last Friday, rose 0.1% for the eighth consecutive day. Among the constituents, ASML, the chip stock with the highest market value in Europe and listed in the Netherlands, rose nearly 0.2%, hitting a new historical high for eight consecutive trading days, with a cumulative increase of about 35.4% since January 15, supporting the Dutch stock index to hit a new historical high for three consecutive days. However, the healthcare sector fell against the trend, with Novo Nordisk, the highest market value pharmaceutical company listed in Denmark, falling nearly 0.2%, falling from the closing high set during the rebound last Friday.

In other individual stocks, luxury shoe manufacturer Tod's, listed in Italy, soared 18.4% after private equity firm L Catterton proposed to acquire a 36% stake and privatize the company; online food delivery platform Delivery Hero rose 4.5% after its target price was raised by Deutsche Bank, while its peer Just Eat Takeaway rose 8.8%, leading the constituents of the STOXX 600.

The two-year US Treasury yield approached the high since the December Fed meeting and then fell.

European government bond prices rebounded last week, and yields fell partly due to dovish comments from European Central Bank officials. Fabio Panetta, a member of the ECB Governing Council and the Governor of the Bank of Italy, said over the weekend that the time to reverse the monetary policy stance is approaching, and inflation has fallen rapidly. If interest rate cuts are delayed and aggressive, it may cause market turmoil. By the end of the bond market, the yield on the UK 10-year benchmark government bond, which had tested 4.10% and reached a high since December 5, fell to 4.05%, a decrease of about 3 basis points during the day.

The 2-year UK bond yield closed at 4.51%, down about 6 basis points intraday; the benchmark 10-year German bond yield closed at 2.36%, down about 2 basis points intraday, breaking away from the high of 2.39% reached on December 1st after rising above it last Friday; the 2-year German bond yield closed at 2.68%, down about 3 basis points intraday.

The yield on the 10-year US benchmark bond briefly fell below 4.15% during European stock trading, hitting a new daily low, down about 3 basis points intraday. It then rebounded, with US stocks rising above 4.19% in early trading, reaching a high not seen since January 19th, approaching the high reached on the first day of the Federal Reserve's interest rate meeting on December 13th. It fell below 4.17% at midday and was around 4.18% at the end of the bond market, showing a slight increase intraday and roughly maintaining the same level as last Friday, after a three-day consecutive rise.

The 2-year US bond yield, which is more sensitive to interest rate prospects, briefly fell below 4.45% during European stock trading, with US stocks approaching 4.49% in early trading, nearing the high of 4.50% reached last Friday. It fell below 4.48% at midday and below 4.47% at the end of the bond market, closing at around 4.47% intraday, down about 1 basis point after a three-day consecutive rise.

The 2-year US bond yield fell during Monday's trading session, while the 10-year US bond yield remained roughly the same as last Friday.

The US dollar index approached a three-month high during trading, then fell, and Bitcoin rose above $50,000 for the first time in over two years.

The ICE US Dollar Index (DXY), which tracks the exchange rate of the US dollar against a basket of six major currencies including the euro, briefly fell below 103.90 to a new daily low of 103.895 before European stock trading, down 0.2% intraday (closing at 104.111 last Friday). After the opening of European stock trading, it maintained an upward trend, with US stocks approaching 104.30 in early trading, reaching a new daily high of 104.279, and rising intraday. It approached the high near the level reached on November 14, 2023, when it rose above 104.60 to 104.604, close to the high since then. It later fell back, and after a decline in midday trading, US stocks approached 104.00, and then rose slightly.

By the close of US stocks on Monday, the US dollar index was slightly below 104.20, at 104.17, with an intraday increase of less than 0.1%; the Bloomberg US Dollar Spot Index, which tracks the US dollar against ten other currencies, rose slightly intraday, and both the US dollar index and the Bloomberg US Dollar Spot Index did not continue the downward trend seen last week.

Among non-US currencies, the yen fell during trading, approaching a two-month intraday low. The US dollar against the yen fell below 149.00 during European stock trading, then rebounded, with US stocks approaching 149.50 in early trading, nearing the high reached on November 27th. By the close of US stocks, it was above 149.30, with a slight increase intraday. The euro against the US dollar briefly rose above 1.0800 during European stock trading, reaching a high not seen since February 2nd, created last Friday. After a decline in early European stock trading, it maintained a downward trend overall, with a brief rise in US stocks and a slight intraday decline at the close of US stocks. The British pound against the US dollar rose above 1.2650 in pre-market trading in Europe, hitting a daily high. In pre-market trading in the US, it fell below 1.2610, hitting a daily low. During midday trading in the US, it rebounded and hovered around 1.2630, experiencing a slight increase throughout the day but not approaching the low of 1.2520 reached on December 23, the lowest level since last Monday.

The offshore renminbi (CNH) against the US dollar fell to 7.2254 during the Asian session, hitting its lowest level since January 17. In pre-market trading in Europe, it rebounded and maintained an overall upward trend. In early trading in the US, it briefly fell as the US dollar rebounded, but during midday trading, it hit a daily high of 7.2128, rising 126 points from the daily low. At 4:59 am Beijing time on February 13, the offshore renminbi against the US dollar was reported at 7.2152, up 35 points from the New York closing price last Friday, ending a three-day decline.

Bitcoin (BTC) fell below $47,800 in pre-market trading in Europe, hitting a daily low. Since pre-market trading in the US, it has accelerated its rise. In early trading in the US, it rose above $49,000, and at the beginning of midday trading, it broke through the $50,000 mark. It briefly rose above $50,200 during midday trading, continuing to hit a high not seen since December 2023. It rose more than $2,000 and more than 5% from the daily low, and at the close of the US market, it was above $50,100, up more than 4% in the past 24 hours.

London base metal futures rose on Monday, with London tin leading the way with a more than 3% increase. It has risen for five consecutive trading days, reaching a six-month high since August last year. London copper and London zinc, which had fallen for three consecutive days, rebounded from their lows of nearly three months and more than five months, respectively. London nickel, which had fallen for two consecutive days, also rebounded, leaving behind the low seen since November 2020. London aluminum, which fell last week, did not continue to decline towards the two-week low set last Monday. However, London lead fell for four consecutive days, continuing to hit a two-month low.

New York gold futures hit a daily high of $2,041.8 before the US market opened, rising nearly 0.2% during the day, but then fell and maintained a downward trend. In early trading in the US, it fell to $2,025.4, hitting a daily low and falling nearly 0.7% during the day.

In the end, COMEX April gold futures closed down 0.28% at $2,033.00 per ounce, falling for three consecutive trading days and hitting a low since January 29 for three consecutive days.

Spot gold rose above $2,027.50 before the US market opened, hitting a daily high. It rose more than 0.1% during the day, but then fell and maintained a downward trend. It briefly fell below $2,012 during midday trading, hitting a low since January 25, and fell more than 0.6% during the day. It briefly rebounded during midday trading, and at the close of the US market, it hovered around $2,020, down about 0.2% during the day.