Breakfast | Risk aversion in US stocks, but Chinese concept stocks rise! Jensen Huang cashes out $24.9 million in NVIDIA shares

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Overnight Morning Market

The three major U.S. stock indexes closed mixed, with the Dow down 0.36% at 39,357.01 points, the S&P 500 flat at 5,344.39 points, and the Nasdaq up 0.21% at 16,780.61 points.

"Tech Seven Sisters" with mixed performance. NVIDIA led the gains with a 4.08% increase, Apple rose by 0.71%, Microsoft by 0.19%, while Google Class A fell by 0.84%, Meta (formerly Facebook) by 0.35%, Amazon by 0.08%, and Tesla by 1.26%.

AI concept stocks with varying performance. "AI darling" AMD rose by 6.33%, BigBear.ai by 11.57%, Dell Technologies by 2.94%, SoundHound AI (backed by NVIDIA) by 5.95%, Oracle by 0.39%, while Serve Robotics (backed by NVIDIA) fell by 18.71%, BullFrog AI by 1.94%, Snowflake by 1.11%, CrowdStrike by 0.65%, C3.ai by 1.4%, and Palantir by 2.1%.

Most Chinese concept stocks rose. Dingdong Maicai rose by 13.97%, DouYu by around 8%, KE Holdings by around 5.5%, New Oriental by 3.9%, Pinduoduo by over 3.2%. ZEEKR briefly rose by over 3.7%, Tencent Holdings ADR briefly rose by over 1.9%, while Bilibili briefly fell by over 4%, XPeng briefly fell by over 3.5%.

Keycorp surged nearly 17% intraday and closed up 9.1%. It was reported earlier that Canadian Imperial Bank of Commerce plans to invest $2.8 billion to acquire a 14.9% stake in Keycorp.

Independent investment bank plunged over 50% intraday amid reports of facing a broader risk disclosure investigation.

JetBlue Airways (JBLU) fell by 20.66%, marking the largest single-day decline since its U.S. IPO in mid-April 2002. Moody's and S&P downgraded its ratings successively after the company announced a bond issuance.

Buffett's Hawaiian Electric Industries opened nearly 22% lower and closed down over 14% after concerns about "ongoing operations" arose.

Market Focus

According to CCTV News, on August 12th local time, White House National Security Council spokesperson John Kirby stated that Iran may launch a "significant" attack on Israel as early as this week. Kirby said that U.S. President Biden had called the leaders of France, Germany, Italy, and the UK on the same day to discuss the escalating tensions. Meanwhile, the Israeli Chief of Staff approved plans for operations on different fronts and ordered the military to maintain readiness.

Blue Chips and Hot Stocks

NVIDIA President and CEO Jensen Huang cashed out $24.9 million by selling 240,000 shares of the company's stock on August 8-9.

The 13F report shows that Citigroup increased its holdings in Apple in the second quarter, with NVIDIA as its top holding, accounting for 4.4% of disclosed holdings. Other top holdings include Microsoft, Apple, Amazon, and Broadcom TechInsights data shows that in the second quarter, Samsung's global smartphone shipments reached 53.8 million units, a slight increase year-on-year, successfully ending the previous seven consecutive quarters of decline.

Demand for electric cars is weak, with reports stating that Volkswagen's next-generation flagship electric car Trinity's production has been delayed until 2032. Analysis points out that the delay in Trinity's release is a major setback for Volkswagen's electric vehicle ambitions, and the company needs to work hard to get back on track and achieve its future mobility goals.

In the second quarter, KE's total transaction volume reached 839 billion yuan, a year-on-year increase of 7.5%; net revenue was 23.4 billion yuan, a year-on-year increase of 19.9%; adjusted net profit was 2.693 billion yuan, a year-on-year increase of 13.9%; the total transaction volume of existing home sales was 570.7 billion yuan, a year-on-year increase of 25.0%; as of June 30, 2024, the number of stores reached 45,948, a year-on-year increase of 6.9%.

In the second quarter of 2024, Nio achieved revenue of approximately 941 million yuan, a year-on-year increase of 13.5%; a net loss of 24.9 million yuan, compared to a net loss of 1.9 million yuan in the same period last year; it is expected that the operating income in the third quarter of 2024 will be between 1.298 billion yuan and 1.483 billion yuan, a year-on-year increase of 40% to 60%.

What do major institutions think?

Goldman Sachs experts accurately predict the correction in the current round of US stocks: turning to technical bullishness at the end of August. Goldman Sachs expert Rubner stated that we are ending the period of the most severe mismatch between supply and demand for stocks in August. From the perspective of a baseball game, we are in the 8th inning out of a total of 9 innings. The trend of NVIDIA's financial report at the end of August will mark the AI darling reaching a technical low point.

Goldman Sachs trader Vani Ranganath stated that the corporate stock buyback window is open, and the "reinforcements" of the US stock market have arrived. The volume of buyback transactions has doubled since last week, and it is expected that by the end of this week, 93% of S&P 500 component companies will be in the buyback window, which will last at least until September 6.

Whether there will be a second round of adjustments in the US and Japanese stock markets, the third quarter is an important observation period. Regarding the adjustments in the US and Japanese stock markets, it can be observed that the subsequent performance of the US economy is a core variable. On the one hand, the US economy directly affects US stocks, and adjustments in US stocks will also drive adjustments in Japanese stocks; on the other hand, assuming a weakening US economy, the logic of the yen appreciating may be further strengthened, thereby affecting the liquidity of the Japanese stock market.

The most accurate analyst on Wall Street: It's not about "to cut or not to cut" anymore, nor is it about "when to cut", but "whether cutting interest rates still works". Bank of America's Chief Strategist Hartnett believes that a significant rate cut by the Federal Reserve is needed to prevent an economic recession. If certain key technical levels are breached, Wall Street's narrative will shift from a soft landing to a hard landing. Hartnett suggests paying attention to the US July NFIB Small Business Confidence data to be released on Tuesday