LB Morning Call | Apple to Slow Hiring, Wall Street warn U.S. stocks will continue to fall

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Asia Pacific

Overnight, European and American stock markets closed mixed, the three major U.S. stock indexes closed down, the Dow fell 0.69%, the S & P 500 index fell 0.84%, the Nasdaq fell 0.81%.

Merck fell 2.72%, Johnson & Johnson fell 2.19%, and Apple fell 2.06% to lead the decline in the Dow. Technology stocks were mixed, with Amazon up 0.18%, Netflix up 0.96%, Facebook up 1.54% and Microsoft down 0.96%. Google fell 2.46% and Tesla rose 0.2%.

Anti-epidemic concept stocks fell across the board, Moderna fell 2.1%, Gilead Science fell 2.72%, Novavax Medicine fell 4.52%, BioNTech fell 0.25%, and AstraZeneca fell 1.47%.

Most of the popular Chinese concept stocks rose, Shangcheng Shuke rose 72.18%, Qudian rose 39.5%, Dingdong Maicai rose 18.2%, iQIYI rose 6.83%, Bilibili rose 6.77%, Shanggao fell 15.71%, JD rose nearly 3%, Baidu and Pinduoduo rose 0.7%, NetEase rose 1.5%. Alibaba rose 0.7%, Tencent ADR rose 2%, and Futu Holdings rose 7.7% before closing up more than 1%.

China's new energy vehicle stocks were mixed, with NIO up 0.53%, Xiaopeng Motors down 4.37% and Li Auto Inc. up 1.85%.

US Stock News

1. It is reported that due to the weak demand for consumer electronics, MediaTek recently decided to increase destocking efforts, requiring fabs other than TSMC to reduce the amount of chips cast first and delay the packaging and testing. Among them, the packaging and testing of old products are suspended, and although the production of new products is maintained, the selling in will also be delayed.

2. The 27 member states of the European Union unanimously approved the "Digital Market Law". This law imposes a series of normative requirements on Internet Tech Giants companies classified as "gatekeeper companies", including not abusing their dominant market position to suppress or acquire competitors, not forcibly pushing advertisements or installing software without the user's permission, and not collecting User data is diverted for other purposes, etc.

3.Apple plans to slow hiring and spending for some teams in 2023 in response to a potential recession, and a number of tech companies including Google, Amazon, Meta, Microsoft, Tesla and Snap have announced similar plans.

4. It is reported that Musk will countersue Twitter and try to give up the $44 billion acquisition.

5. IBM second-quarter earnings per share of $1.53, analysts expected $1.623. Revenue was $15.54 billion, analysts expected $15.179 billion. Net profit was $1.392 billion, analysts expected $1.448 billion. IBM U.S. stocks fell more than 2% after hours.

6. Haleon, an independent company after GlaxoSmithKline spun off its consumer health business, began trading on the London Stock Exchange at 330p per share and a market value of about £30.5 billion.

7. Berkshire Hathaway buys about 1.9 million shares of Occidental Petroleum on July 14-16.

Hong Kong News

1. The organizational structure of Bilibili has been adjusted continuously, involving multiple core business departments and six business leaders. Among them, Liu Zhi, vice president of Bilibili and former head of operations, will be responsible for the commercialization of the mid-platform system and the main station business center; Liu Binxin, former head of Bilibili's commercialization mid-platform and main station business center, and vice president, will resign.

2. HSBC Holdings will accelerate the pace of exiting non-core markets and deploy more capital in Asia, people familiar with the matter said.

3. The exchange rate of the Hong Kong dollar continued to hit the weak side conversion level of 7.85 during the New York trading session. According to the linked exchange rate mechanism, the Hong Kong Monetary Authority announced this morning that it would undertake 8.07 billion sell orders for the Hong Kong dollar. The aggregate balance of the Hong Kong banking system will fall to 190.943 billion Hong Kong dollars after July 21. Since the early morning of May 12, the Hong Kong Monetary Authority has received money 20 times, with a total of 146.537 billion Hong Kong dollars.

Singapore News

Mapletree Commercial Trust has begun accepting new shares from existing shareholders to raise funds to acquire Mapletree North Asia Commercial Trust. For every 1,000 shares held by existing shareholders, they are entitled to subscribe for 306 shares at $2.0039 per share.

Macroeconomy

1. Morgan Stanley believes that the current economic cycle is rotating much faster than before, which means the bear market will end soon. The S & P 500 is expected to bottom around 3,400 if the U.S. economy avoids recession. However, a stronger dollar poses significant headwinds for the index.

2. Goldman Sachs and other Wall Street investment banks have warned that the recent rebound in U.S. stocks will be very short-lived given inflationary pressures. Even if the U.S. economy does not fall into recession, U.S. stocks will continue to fall.

3. According to the CME "Fed Observation": the probability of the Fed raising interest rates by 75 basis points in July is 69.1%, and the probability of raising interest rates by 100 basis points is 30.9%; by September, the cumulative rate hike of 75 and 100 basis points The probability is 0%, the probability of accumulating 125 basis points is 34.6%, the probability of accumulating 150 basis points is 50.0%, and the probability of raising interest rates is 175 The probability of the basis point is 15.4%.

4. Northvolt, a battery company jointly funded by Volkswagen and Goldman Sachs, has successfully developed cylindrical batteries with a diameter of 21 mm and a height of 70 mm, and is preparing for mass production, which means that the competition for cylindrical batteries will intensify.

5.Last Friday, traders bought interest rate futures with a nominal value of $150 billion, betting that the Fed would not raise interest rates by 100 basis points. As of Friday's close, the contract rose 11.5 points, or about $14.4 million in profit.

Reminders

17:00, Eurozone June CPI

20:30, the total number of building permits in the United States in June