Overnight U.S. Stocks | Highs Fizzle Out! Three Major Indices Close Lower, Tesla Continues to Hit New Highs Since April 2022

Zhitong Finance learned that on Thursday, the three major indices closed lower. Oil prices slightly declined on Thursday, although OPEC+ postponed production resumption, it still plans to increase output next year. Gold prices fell as investors awaited the U.S. non-farm payroll data on Friday for clues on the Federal Reserve's policy direction. Macquarie Group believes that gold prices have further room for increase next year and may reach new highs. The bank expects the average gold price in the first quarter of next year to be $2,650 per ounce, an increase of 1.9% from previous expectations.

【U.S. Stocks】 As of the close, the Dow Jones Industrial Average fell 248.33 points, a decrease of 0.55%, closing at 44,765.71 points; the Nasdaq Composite fell 34.86 points, a decrease of 0.18%, closing at 19,700.26 points; the S&P 500 index fell 11.38 points, a decrease of 0.19%, closing at 6,075.11 points. Tesla (TSLA.US) rose over 3%, continuing to hit new highs since April 2022, while Intel (INTC.US) fell over 5%. The Nasdaq China Golden Dragon Index rose 0.4%, Alibaba (BABA.US) fell nearly 1%, and JD (JD.US) rose nearly 2%.

【European Stocks】 The German DAX 30 index rose 165.70 points, an increase of 0.82%, closing at 20,382.05 points; the UK FTSE 100 index rose 13.21 points, an increase of 0.16%, closing at 8,349.02 points; the French CAC 40 index rose 27.26 points, an increase of 0.37%, closing at 7,330.54 points; the Euro Stoxx 50 index rose 31.23 points, an increase of 0.63%, closing at 4,950.25 points; the Spanish IBEX 35 index rose 190.17 points, an increase of 1.59%, closing at 12,121.77 points; the Italian FTSE MIB index rose 547.09 points, an increase of 1.61%, closing at 34,631.00 points.

【Asia-Pacific Stock Markets】 The Nikkei 225 index rose 0.3%, the Jakarta Composite Index in Indonesia fell 0.18%, and the KOSPI index in South Korea fell 0.9%.

【Cryptocurrency】 Bitcoin continued to decline, falling below the $98,000 mark, a significant pullback of $6,000 from yesterday's historical high.

【Gold】 International precious metal futures generally closed lower, with COMEX gold futures down 0.79% at $2,655 per ounce, and COMEX silver futures down 0.28% at $31.825 per ounce.

【Oil】 WTI January crude oil futures closed down $0.24, a decrease of 0.35%, at $68.30 per barrel. Brent February crude oil futures closed down $0.22, a decrease of 0.30%, at $72.09 per barrel. NYMEX January natural gas futures closed up 1.18%, at $3.0790 per million British thermal units.

【Macroeconomic News】

U.S. Stock Market: Traders anxious ahead of non-farm data, market momentum stalls at high levels. Wall Street traders are busy preparing for the key non-farm payroll data that will help the Federal Reserve decide whether to cut rates or hold steady in December, as the U.S. stock market loses momentum near record highs. The market fell the day after the S&P 500 index set a new high for the 56th time this year. "Tomorrow's monthly non-farm data will give us a more comprehensive view, but for now, the situation remains that the job market sometimes shows signs of fatigue but is not collapsing," said Chris Larkin from Morgan Stanley E*Trade A 22V Research survey shows that 45% of investors believe that Friday's non-farm data is "mixed/insignificant," 32% expect the data to lead to "risk aversion," while 23% are optimistic that it will stimulate risk appetite.

New York Fed Research: Tariffs during Trump's first term caused losses for U.S. companies, and the benefits of tariffs are hard to achieve. The latest analysis by staff at the New York Fed shows that on the day tariffs were announced during President Trump's first term, U.S. companies' stock prices generally fell, and this was closely related to the future decline in profits, sales, and employment of the companies most affected. "An important motivation for imposing tariffs on imported goods is to protect U.S. companies from foreign competition. By taxing imported goods, the prices of domestically produced goods become relatively cheaper, leading American spending to shift from imported goods to domestically produced goods," wrote economists including Mary Amiti, head of the Labor and Product Markets Research Department at the New York Fed, in their analysis report. However, "most companies saw significant declines in stock prices on the day tariffs were announced. Our documents also show that these financial losses ultimately translate into future declines in profits, employment, sales, and labor productivity." The research team at the New York Fed found that "the benefits of tariffs are hard to achieve due to the complexity of global supply chains and the potential for foreign retaliation." It is estimated that the trade war during Trump's first term worsened the economic situation for businesses and households by about 3%.

Former U.S. Treasury Secretary Summers criticizes the idea of a national Bitcoin reserve as too "crazy." Former Treasury Secretary and Democrat Summers dismissed the idea of the U.S. government establishing a Bitcoin asset reserve and warned that reducing federal spending according to "America First buddy" Musk's plan would face political challenges. Summers stated on a television program, "What some people are saying, 'We should establish some kind of national Bitcoin reserve,' is crazy." "There is no reason to do this other than to cater to generous special interest campaign donors." The former Treasury Secretary noted that while Musk's goal is to save $2 trillion in spending, the total payroll of the federal government is less than that figure. He emphasized that most of the government's spending is related to defense and support for American seniors, which is politically difficult to change.

Macron's first speech after the French government collapsed: A new Prime Minister will be appointed in the coming days. On the evening of December 5th local time, French President Macron delivered a televised address. Macron stated that he accepted Prime Minister Barnier's resignation on that day, and the new Prime Minister will be announced in the coming days. He also expressed gratitude for Barnier's work. Macron indicated that the impeachment of Barnier's government was due to a coalition of the far-right and far-left, blaming the far-right National Rally party for creating chaos. Regarding the French budget bill for 2025, he stated that a "special law" draft will be submitted in mid-December for consideration by the National Assembly. Furthermore, even if the far-left demands his resignation, he will continue to fully perform his presidential duties until the end of his term U.S. 30-Year Mortgage Rates Fall to Lowest Level Since October. U.S. mortgage rates have declined for the second consecutive week. Freddie Mac reported on Thursday that the average rate for a 30-year fixed mortgage in the U.S. is 6.69%, the lowest level since October 24, down from 6.81% last week. However, borrowing costs remain significantly higher than in September, and true relief may still be a long way off. Real estate company Redfin expects 30-year mortgage rates to remain close to 7% throughout 2025.

【Individual Stock News】

Chevron (CVX.US) Plans to Cut Capital Expenditures, Including Global Layoffs. Chevron announced its first budget cuts in the shale oil sector since the pandemic on Thursday. The company stated it will limit oil production growth in the Permian Basin while increasing cash flow from the field. The company also announced it will cut global capital expenditures by $2 billion next year and reduce structural costs by up to $3 billion by 2026, which includes layoffs globally. However, the company did not disclose how many jobs would be affected.

Stellantis (STLA.US) and Zeta Energy Reach Agreement to Develop Lithium-Sulfur Batteries for Electric Vehicles. Stellantis has signed an agreement with U.S.-based battery manufacturer Zeta Energy to develop cheaper lithium-sulfur batteries for electric vehicles, the two companies announced on Thursday, with a goal to have them in use by 2030. Stellantis and Zeta stated in a joint announcement, "The cost of lithium-sulfur batteries is expected to be less than half the current price per kilowatt-hour of lithium-ion batteries." The agreement aims to develop lighter batteries, but with energy potential comparable to current lithium-ion batteries. The two companies indicated that this technology could increase battery fast-charging speeds by 50%. The agreement includes pre-production development and future production plans through 2030.

【Major Ratings】

Bank of America Securities: Raises Tesla (TSLA.US) target price to $400, maintains "Buy" rating