Breakfast | US Seven Giants Sold Off Sharply, Tesla Delays Robotaxi Release

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Overnight Morning Market

The Nasdaq fell 364.04 points or 1.95%, marking its worst single-day performance since April 30 and the fourth worst performance of the year. The Russell 2000 rose 73.28 points or 3.57%, its best performance since November 14 last year when the index surged by 5.44%.

Following positive US CPI data, traders chose to withdraw from recent strong-performing tech giants, leading to the seven tech giants in the US facing the largest selling pressure in nearly a year. Tech heavyweight NVIDIA fell by 5.57%, losing $185 billion in market value. Tesla dropped by 8.44%, Meta fell by over 4%, while Apple, Microsoft, Google, and Amazon each fell by over 2%. The combined market value of the "seven giants" evaporated nearly $600 billion in a single day, equivalent to the market value of JP Morgan ($595.46 billion).

On the other hand, the Russell 2000 index surged by 3.57%, marking its best single-day performance in 7 months.

Chinese concept stocks outperformed the US market. XPeng rose by 7.68%, Li Auto rose by 3.42%, Nio rose by 1.3%, ZEEKR rose by 4.64%; JD.com rose by 6.99%, Baidu rose by 2.79%, Alibaba rose by 3.3%, Tencent Holdings (ADR) rose by 1.77%, Pinduoduo rose by 0.85%, and Bilibili rose by 3.89%.

Blue Chips and Hot Stocks

Tesla delays the release of Robotaxi from August to October, with designers being asked to redesign Robotaxi elements.

Amazon founder Bezos cashes out $4.527 billion worth of Amazon stocks.

Sources: Boeing is close to reaching an agreement with Korean Air to sell 20 to 30 777X aircraft.

Stellantis (STLA.N) subsidiary Fiat's Grande Panda electric car will be priced below $25,000.

Market news: The US Federal Trade Commission (FTC) plans to delay its decision on whether to block Chevron (CVX.N) from acquiring US oil company Hess (HES.N) for $53 billion.

Bank of America Global Research: Raises Apple's (AAPL.O) target price from $230 to $256, citing the benefits of generative AI features in promoting the iPhone upgrade cycle.

Delta Air Lines (DAL.N) fell by 8.6% as Q2 earnings and Q3 revenue guidance fell short of market expectations.

Pfizer (PFE.N) states that it is advancing the development of a once-daily oral weight-loss drug and will conduct dose optimization studies in the second half of the year.

A source close to Kuaishou revealed that the strategic cooperation between Kuaishou and Meituan has recently expired and been renewed, with the cooperation between the two parties set to be upgraded comprehensively. According to the agreement, the scope of cooperation between Kuaishou and Meituan will expand nationwide to "hundreds of cities and thousands of stores" over the next three years.

Chips and Artificial Intelligence

Market news: Republican lawmakers in the US are calling on the Biden administration to evaluate the collaboration between Microsoft and Abu Dhabi's artificial intelligence company G42.

Market news: OpenAI has developed a system to track progress towards achieving human-level artificial intelligenceBritish semiconductor company Graphcore: Collaborating with SoftBank Group to jointly develop the next generation of artificial intelligence computing.

Macro: Taking you to see the world

Fed - Daly: Considering various data, it may be necessary to adjust monetary policy, and it is appropriate to cut interest rates 1/2 times this year;

Fed - Mester: Recent data shows progress in inflation, hoping that there will be data to give me confidence to expect inflation to reach 2% by the middle or end of next year;

Fed - Bullard: It is possible to consider a rate cut or a series of rate cuts, there is no need to panic about the unemployment situation, and progress in housing inflation needs to be seen. June CPI showed inflation on the path to 2%.

US June CPI rose by 3% year-on-year, falling to the lowest level since June last year, estimated to rise by 3.1%, with the previous value rising by 3.3%; month-on-month fell by 0.1%, estimated to rise by 0.1%, with the previous value remaining unchanged. June core CPI rose by 3.3% year-on-year, lower than the expected 3.4% increase and the previous 3.4% increase, the lowest level since April 2021; month-on-month rose by 0.1%, with the expected and previous values both rising by 0.2%, the smallest increase since August 2021.

US June CPI cooled down overall, with the overall index turning negative month-on-month for the first time, and core CPI falling to a three-year low. Interest rate futures fully priced in a rate cut in September, betting on a total rate cut of 61 basis points by the end of the year, up 11 basis points from before the data was released.

The probability of a Fed rate cut has significantly increased, with a high likelihood of the first cut in September

According to CME "FedWatch": The probability of the Fed keeping rates unchanged in August is 91.2%, with a 8.8% probability of a 25 basis point rate cut. The probability of the Fed keeping rates unchanged by September is 7.3%, with a cumulative 84.6% probability of a 25 basis point rate cut, and a cumulative 8.1% probability of a 50 basis point rate cut.

Goldman Sachs Asset Management: Data suggests the Fed will cut rates in September with three more inflation reports to be released

Between today and the September Fed meeting, there are three more inflation data releases. Today's data is crucial in helping the Fed gain confidence that inflation is still moving in the right direction. The heat of economic data seems to have dissipated, with cooler inflation data following last week's cooling labor market data, indicating that the Fed will cut rates in September.

J.P. Morgan moves up Fed rate cut expectations from November to September

Based on strong June inflation data in the US, it is believed that the Fed's rate cut cycle will start earlier. Fed Chairman Powell has mentioned that the central bank hopes to see more good news on inflation, and the latest CPI data provides the decision-makers with the information they need.

Analysts assess Thursday's US stock index performance: David defeats Goliath

Forexlive analyst Greg Michalowski: The Nasdaq Composite Index is the "Goliath" of 2024, having risen nearly 25% this year, and it's only July. The small-cap Russell 2000 Index suffered losses. But on Thursday, the Russell 2000 Index "pulled out the slingshot" and beat the "giant" Nasdaq.

Goldman Sachs strategist: Even investors who are bullish on the long-term potential returns of AI are increasingly worried that the adoption of artificial intelligence is not progressing fast enough to prove the rationality of the speculation in related concept stocks. The stock market's enthusiasm for AI is becoming more detached from reality, and the second-quarter earnings report will be a key test of the sustainability of the AI frenzy. It is recommended to focus on sales guidance revisions for companies related to artificial intelligenceSource:

Insider: Sean Fein, President of the United Auto Workers, told the board that he is concerned that Biden may not be able to defeat Trump, and the union is considering the next steps.

HSBC: The strength of the US dollar will continue into next year.

Germany will remove Chinese components from its 5G core network by the end of 2026, China's Ministry of Foreign Affairs responds