Overnight US Stocks | Dow Jones, S&P Hit Historic Highs as NVIDIA Ends 5-Day Winning Streak

According to Zhitong Finance, on Wednesday, the three major indices closed higher, with the Dow and S&P 500 hitting new all-time highs. The minutes of the Federal Reserve's September monetary policy meeting showed a divergence of views among officials on a 50 basis point rate cut, and NVIDIA (NVDA.US) ended a 5-day winning streak.

[US Stocks] At the close, the Dow rose 431.63 points, or 1.03%, to 42,512.00 points; the Nasdaq rose 108.70 points, or 0.60%, to 18,291.62 points; the S&P 500 rose 40.91 points, or 0.71%, to 5,792.04 points. NVIDIA (NVDA.US) edged down slightly, while Apple (AAPL.US) and Amazon (AMZN.US) both rose over 1%. The Nasdaq Golden Dragon Index fell by 1.29%, Alibaba (BABA.US) dropped by over 1%, and XPeng (XPEV.US) rose by over 3%.

[European Stocks] The German DAX30 index rose 190.47 points, or 1.00%, to 19,261.25 points; the UK's FTSE 100 index rose 51.58 points, or 0.63%, to 8,242.19 points; the French CAC40 index rose 38.77 points, or 0.52%, to 7,560.09 points; the Euro Stoxx 50 index rose 33.15 points, or 0.67%, to 4,982.15 points; the Spanish IBEX35 index rose 8.30 points, or 0.07%, to 11,743.00 points; the Italian FTSE MIB index rose 189.10 points, or 0.56%, to 33,923.00 points.

[Asia-Pacific Stock Markets] The Nikkei 225 index rose by 0.87%, the Indonesia Jakarta Composite Index fell by 0.74%, and the Vietnam VN30 index rose by 0.96%.

[Cryptocurrency] Bitcoin fell by over 2.6% to $60,785 per coin; Ethereum fell by over 3% to $2,375.82 per coin.

[Crude Oil] US crude oil futures prices fell on Wednesday, extending the previous day's sharp decline of over 4.6%. The market continues to focus on geopolitical risks in the Middle East. The West Texas Intermediate (WTI) crude oil futures prices for delivery in November on the New York Mercantile Exchange fell by 33 cents, or 0.45%, to close at $73.24 per barrel. On Tuesday, the futures closed down by 4.63% at $73.57 per barrel.

[Gold] COMEX gold futures fell by 0.55% to $2,626.1 per ounce; COMEX silver futures fell by 0.52% to $30.73 per ounce.

[Metals] London metals fell, with LME copper down by 0.73%, LME aluminum down by 0.97%, LME nickel down by over 1.4%, and LME zinc down by over 1.6%.

[Macro News]

Minutes reveal deeper divisions at the Federal Reserve. The Federal Reserve cut rates by half a percentage point at its September meeting, but Chairman Jerome Powell faced some resistance to this decision as more than one of his colleagues advocated for only a 25 basis point rate cut. "Some participants indicated that they would have preferred a 25 basis point reduction in the target range at this meeting, and several others indicated that they would have supported such a cut as well," the Federal Open Market Committee minutes released on Wednesday in Washington for the September 17-18 meeting stated All participants agreed that lowering borrowing costs is appropriate. The Federal Reserve of the United States cut its benchmark interest rate by 50 basis points last month, taking decisive action to provide a buffer for economic growth in the face of stubbornly slowing inflation and rising risks in the job market. However, for many officials, a concern is that such a large rate cut is not consistent with their gradual lowering of rates. Meeting minutes show, "Several participants noted that a 25 basis point cut would align with the gradual normalization path of policy, allowing policymakers time to assess the extent of policy constraints when the economic situation changes." Although the only dissenter ultimately casting a vote against was board member Michelle Bowman, the meeting minutes indicate a more serious level of dissent among decision-makers than the nearly unanimous decision would suggest. This indicates that the committee implemented a significant rate cut under the leadership of Powell.

Wholesale inventories in the United States saw a slight increase in August. Data from the U.S. Department of Commerce shows that wholesale inventories in the United States rose for the fifth consecutive month in August, although the growth rate was slightly lower than in July. Adjusted data released on Wednesday showed a 0.1% month-on-month increase in wholesale inventories. The inventory-to-sales ratio for August (measuring how many months it would take for wholesalers to sell existing inventory) was 1.35, the same as in July and the same month in 2023. The data shows that durable goods inventories increased by 0.3% while nondurable goods inventories decreased by 0.1%.

Capital Economics: The Federal Reserve is expected to cut rates by nearly two percentage points from now. Analyst Paul Ashworth from Capital Economics stated in a report that the Federal Reserve may continue to cut rates by 25 basis points until the federal funds target rate falls to the range of 3%-3.25%. According to data from the CME Group, this would be higher than the market's general expectation that the terminal rate would reach 3.25%-3.5% or higher. Ashworth expects a 25 basis point rate cut by the Federal Reserve in November, which is also the most anticipated by the market, although the probability of keeping rates unchanged in November has risen from 15% yesterday to 22%.

Hurricane "Milton" approaches: Florida in the United States will face its second strong hurricane within two weeks. On the 9th local time, the National Hurricane Center of the United States stated that Hurricane "Milton" weakened to a Category 4 hurricane as it approached the Florida Peninsula. The day before, "Milton" had briefly upgraded to a Category 5 hurricane. "Milton" is expected to make landfall in the densely populated Tampa Bay area of Florida on the night of the 9th to the early morning of the 10th. The U.S. Department of Health and Human Services declared on the 8th that Florida has entered a state of public health emergency due to the hurricane weather. This is the second time in the past two weeks that Florida has declared a state of public health emergency due to hurricane weather.

OpenAI expects to incur a loss of $14 billion in 2026. According to The Information: OpenAI burned $340 million in the first half of 2024. OpenAI's forecast indicates that the company will not achieve profitability until 2029, when its revenue will reach $100 billion. Based on an analysis of data contained in OpenAI's financial documents, the company's losses could reach as high as $14 billion by 2026, nearly three times the expected loss this year, with total losses expected to reach $44 billion from 2023 to 2028 This estimate does not include stock compensation, which is one of OpenAI's largest expenses, although it is not paid in cash.

[Stock News]

Musk is betting Tesla's (TSLA.US) future on Robotaxi. Elon Musk is sacrificing a widely anticipated affordable car to get Robotaxi on the road, disbanding teams focused on other projects and downplaying the impact of slowing Tesla sales. Therefore, when Musk finally unveiled a prototype Robotaxi later on Thursday, he needed to prove many things to the audience. He promised to usher in a new era of transportation with autonomous taxi services as a key component. In recent months, investors have believed that the product they have been waiting for is finally ready to be launched, or at least close to being ready, as Tesla's stock price continues to rise.

Amazon (AMZN.US) to deploy 1,000 electric delivery vans equipped with visual-assisted package retrieval feature. Amazon announced that it will deploy 1,000 electric delivery vans equipped with a visual-assisted package retrieval (VAPR) feature in early 2025. With the AI solution of VAPR, delivery drivers will no longer need to spend time sorting packages by site, reading labels, or manually checking customer names or addresses to ensure correct deliveries, they just need to wait for the green light from VAPR to confirm.

[Major Banks Ratings]

Loop Capital: Upgrades Home Depot (HD.US) from "Hold" to "Buy"

JP Morgan: Raises Alibaba's (BABA.US) target price from $108 to $125