Pre-market trading in US stocks | TSMC receives a large number of AI chip orders, Disney initiates the third round of layoffs, and activist investor TCS invests in Yelp.

US Stock News

1. Vipshop's Q1 2023 revenue was RMB 27.54 billion, exceeding market expectations of RMB 26.084 billion and last year's same period of RMB 25.245 billion. Net revenue for the second quarter is expected to be between RMB 27 billion and RMB 28.2 billion.

2. Li Auto: In the third week of May 2023 (May 15-21), Li Auto's weekly sales reached 7,100 vehicles, far exceeding other new energy vehicle brands, and won the crown of weekly sales of new energy vehicle brands in the Chinese market.

3. An insider from Alibaba Cloud Intelligence revealed: "The company will carry out normal organizational position and personnel optimization every year. The personnel adjustment this time was launched in May after the year-end bonus was issued at the end of April. The overall optimization ratio is about 7%, and the compensation standard is N+1+1. Unrested annual leave, companion leave, etc. can be cashed out."

4. China approves Microsoft's acquisition of Activision Blizzard. Activision Blizzard has always attached great importance to the Chinese market.

5. "Wood Sister" Cathy Wood's ARK Ark Fund continued to increase its holdings of Palantir Tech's stock on Monday, adding about $4 million worth of the company's stock to multiple funds.

6. Data from Dow Jones Market Data Company shows that since July 5, 2022, the yield on US 2-year Treasury bonds has been inverted with the yield on 10-year Treasury bonds. This is the longest time since 446 trading days ending on May 1, 1980, that short-term bond yields have exceeded long-term bond yields.

7. Industry insiders revealed that TSMC has received a large number of artificial intelligence chip orders with its sub-7nm process technology in response to the surge in demand for generative AI applications. (Taiwan Electronic Times)

8. Disney will carry out the third round of layoffs, and the company is expected to notify affected employees this week, with more than 2,500 employees facing unemployment.

9. According to The Wall Street Journal, informed sources said that activist investor TCS Capital Management has invested in Yelp and called on the service recommendation website to explore strategic options, including sales.

Pre-market Movement

In pre-market trading, Dow futures, Nasdaq futures, and S&P 500 futures all fell slightly.

Alibaba fell 1.3%, JD.com fell 1.6%, Bilibili and Beike fell nearly 2%, Baidu, Pinduoduo, and Xiaopeng fell more than 1%, NetEase fell 2.5%, and NIO and Ideal fell more than 2%.

Yelp surged 12%.

Institutional Views

1. UBS warns that the continuously rising US stocks have not fully reflected the possibility of tightening credit environment and slowing growth.

UBS analysts said they believe that the current pricing of the US stock market has not fully reflected the possibility of tightening credit environment and slowing growth. UBS recommends that investors invest in high-quality bonds, which it says offer "higher risk-adjusted returns". If you want to continue investing in the stock market, including emerging market stocks such as China, it would be better to invest in defensive stocks such as basic consumer goods and utilities.

2. CICC: Maintains Neutral Rating on NIO

CICC stated that based on the 1.5x enterprise value/sales ratio in 2023, the target price was lowered from HKD 83.1 to HKD 66.6. The company has not yet disclosed any new vehicle schedules for 2024, especially for its mass market brand. Given the current intense competition, the bank holds a conservative attitude towards the prospects of NIO's mass market brand, and also sees difficulties in expanding in the high-end market.

US Stock Strategy

1. US Stock Options | NIO, Micron Technology options trading volume doubled, Pfizer, Upstart options trading volume surged fourfold

2. The US stock market remains calm as the US debt limit approaches

3. NVIDIA's Q1 performance won't look good, the key is Q2 guidance!

4. What will happen if US bonds default? Wall Street is already preparing contingency plans

5. Why is the spin-off listing of six major businesses Alibaba's last chance?

6. Goldman Sachs heavyweight analysis: How will the US debt ceiling end?

7. Big Bank Quick Look | Alibaba, Kuaishou can still rise by at least 60%? NIO's target price has been significantly lowered!