Overnight US Stocks | Three major indices show mixed movements, with Dow Jones and S&P 500 hitting new intraday highs

According to Zhītōng Finance, on Wednesday, the three major indices showed mixed movements. Intraday, the Dow rose to a high of 42,299.64 points, while the S&P 500 rose to 5,740.13 points, both hitting new intraday highs. On Tuesday, the S&P 500 and Dow rose by 0.25% and 0.20% respectively, both reaching new all-time highs. The three major U.S. stock indices all recorded gains in September.

[U.S. Stocks] At the close, the Dow fell by 293.47 points, a decrease of 0.70%, to 41,914.75 points; the Nasdaq rose by 7.68 points, an increase of 0.04%, to 18,082.21 points; the S&P 500 fell by 10.67 points, a decrease of 0.19%, to 5,722.26 points. NVIDIA (NVDA.US) rose by 2%, Intel (INTC.US) rose by 3%, and Trump Media & Technology Group (DJT.US) rose by 10%.

[European Stocks] The German DAX 30 Index fell by 63.79 points, a decrease of 0.34%, to 18,923.95 points; the UK's FTSE 100 Index fell by 11.51 points, a decrease of 0.14%, to 8,271.25 points; the French CAC 40 Index fell by 38.39 points, a decrease of 0.50%, to 7,565.62 points; the Euro Stoxx 50 Index fell by 23.27 points, a decrease of 0.47%, to 4,917.45 points; the Spanish IBEX 35 Index fell by 35.92 points, a decrease of 0.30%, to 11,801.08 points; the Italian FTSE MIB Index fell by 44.26 points, a decrease of 0.13%, to 33,837.00 points.

[Asia-Pacific Stock Markets] The Nikkei 225 Index fell by 0.19%, the Indonesia Jakarta Composite Index fell by 0.48%, and the Vietnam VN30 Index rose by 0.99%.

[Gold] COMEX gold futures rose by 0.16% to $2,681.3 per ounce; COMEX silver futures fell by 0.94% to $32.125 per ounce.

[Cryptocurrencies] Bitcoin fell by over 1.2% to $63,529.9 per coin; Ethereum fell by over 2.6% to $2,579.97 per coin.

[Crude Oil] WTI crude oil futures fell by 2.43% to $69.82 per barrel; Brent crude oil futures fell by 2.10% to $73.59.

[Metals] London metals showed mixed movements, with zinc falling by 0.48%, aluminum falling by 0.51%, copper rising by 0.16%, and nickel rising by 0.65%.

[Macro News]

Fed's Kugler: Strongly Supports Decision to Cut Rates by 50 Basis Points. Federal Reserve Governor Kugler stated today that she "strongly supports" the Fed's decision to cut rates by 50 basis points, reflecting a focus on the job market. Kugler said, "The job market still has resilience, but the FOMC now needs to balance its focus in order to continue making progress in eliminating inflation while avoiding unnecessary pain and economic weakness. I strongly support last week's (50 basis points rate cut), and if inflation continues to progress as I expect, I will support further rate cuts." Kugler expects this Friday's inflation data to show continued easing of price pressures, with the August PCE price index likely to drop to 2.2% on an annual basis She said that the Federal Reserve's current focus on the job market is appropriate, as the job market has cooled down but still "has resilience," with a 4.2% unemployment rate "still quite low by historical standards."

U.S. mortgage rates fall again, triggering a wave of massive refinancing. With more and more Americans taking advantage of the cheapest borrowing costs in two years, mortgage refinancing applications surged for the second consecutive week. Data from the American Bankers Association showed that the association's refinancing index jumped by 20.3% in the week ending September 20, reaching the highest level since April 2022. The 30-year fixed mortgage contract rate dropped by 2 basis points to 6.13%, marking the eighth consecutive week of decline and the longest continuous decline since 2018-2019. This pushed the association's home purchase application index up by 1.4% last week, reaching the highest level since early February. The index rose for the fifth consecutive week, indicating a rapid growth in housing market demand, gradually finding some footing. At the same time, housing financing costs may start to stabilize. Last week, the yield on the 10-year U.S. Treasury note edged up slightly, as traders debated the magnitude and path of the Fed's expected rate cut in November.

New York Fed Open Market Account Manager: The market is ready to correctly interpret last week's rate cut. An official from the New York Fed responsible for implementing monetary policy said on Tuesday that the financial markets are ready to correctly interpret the Fed's unexpected rate cut last week, believing that this is not a sign of trouble. Roberto Perli, head of the Federal Reserve System's Open Market Account (SOMC), said in a speech that although the futures market did not fully digest the factors behind the Fed's 0.5 percentage point rate cut last week, market intelligence collected by the New York Fed indicates that investors may correctly interpret the 50 basis point rate cut. They believe that a more neutral FOMC policy stance will help maintain economic and labor market momentum, while continuing to push inflation further.

Goldman Sachs: Expects S&P 500 Index to reach 6000 points, bullish on mid-cap stocks in the context of rate cuts. David Kostin, Chief U.S. Equity Strategist at Goldman Sachs, said that once the dust settles on the U.S. presidential election, the U.S. stock market will continue to rise. Kostin expects the S&P 500 Index to be around 6000 points in a year. This forecast implies a roughly 5% increase from the record closing level of about 5719 points on Monday. The index has risen by about 20% this year. However, he noted that given the showdown between Biden and Trump is likely to be decided at the last minute, investors may have to deal with some market volatility in the coming weeks. Kostin also believes that mid-cap stocks present opportunities, pointing out that compared to large-cap and small-cap stocks, mid-cap stocks have historically performed better, with lower valuation multiples and better valuations. He also noted that in the 3-month and 12-month periods after rate cuts, mid-cap stocks often outperform the broader market.

U.S. House of Representatives passes short-term spending bill, to be reviewed by the Senate. On September 25th local time, the U.S. House of Representatives passed a three-month short-term spending bill with a vote of 341 in favor and 82 against, to avoid a government shutdown at the end of the month. The purpose of the bill is to ensure that the U.S. government's funding can continue at current levels for three months until December 20th The Senate is expected to vote on the bill on the evening of September 25, and once the bill is passed, it will be signed into effect by President Biden.

[Stock News]

Google (GOOG.US, GOOGL.US) files antitrust lawsuit against Microsoft (MSFT.US) with the EU, accusing Microsoft of stifling cloud computing competition. Google filed an antitrust lawsuit against Microsoft with the European Commission on Wednesday, accusing Microsoft of using unfair licensing agreements to stifle competition in the multi-billion-dollar cloud computing industry. The core of Google's complaint is that Microsoft is using unfair licensing terms to "lock in" customers and control the cloud market. Google alleges that Microsoft, through its dominant Windows Server and Microsoft Office products, makes it difficult for its large customers to use any products other than its Azure cloud infrastructure. Google stated in the complaint that the restrictions in Microsoft's cloud licensing terms make it harder for customers to move their workloads from Microsoft's Azure cloud technology to competitors' clouds, even though there are no technical barriers to doing so. Google cited a study by the cloud computing industry trade group CISPE in 2023, which stated that the ability of customers to switch from one cloud provider to another is limited, forcing European businesses and public sector organizations to pay up to €1 billion ($1.1 billion) in licensing fines to that company each year. Google's antitrust complaint comes after CISPE and its members reached a settlement with Microsoft in July, which would require Microsoft to make changes to address competition issues. Microsoft mentioned the settlement with CISPE in a statement on Wednesday, stating that the European Commission is expected to reject Google's appeal. "Microsoft has amicably addressed similar concerns raised by European cloud providers, although Google hopes they will continue to litigate," a Microsoft spokesperson said. "After failing to convince European businesses, we expect Google will also fail to convince the European Commission."

Apple (AAPL.US) stock falls as Morgan Stanley warns of shortened iPhone delivery cycle. Apple's stock edged lower as Morgan Stanley analysts pointed out that the delivery cycle for the iPhone 16 is shorter than the past three iPhone cycles. Analysts like Erik Woodring wrote, "Despite supply improvements, we have heard positive rumors about iPhone 16 demand, but we remain cautious in interpreting these data points." On the 11th day after pre-orders began, "the delivery cycle for the iPhone 16 in the United States is 15 days, compared to 26 days for the iPhone 15 model at the same time last year, and 18 days for all iPhone 14 models." "Overall, these data points for the iPhone 16 cycle lean more negative than positive, although their predictive power for the entire cycle remains weak." Shortly after the launch of the iPhone 16, other analysts had already warned of weak demand for the iPhone 16.

[Major Banks Ratings] Morgan Stanley: Downgrades General Motors (GM.US) rating from "Hold" to "Underweight"