Breakfast | High-yield US bonds weigh on US stocks, "smart money" collectively sells off, Zhongxu Future receives oversubscription over 100 times.

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Market: Overnight and this morning

US stock index futures opened slightly higher, with Dow Jones futures up 0.13%, S&P 500 futures up 0.12%, and Nasdaq futures up 0.08%.

US bond yields hit a more than decade-high, US stocks hit about four-month lows, Amazon drops 4%

US bond yields remain at a more than decade-high level. The market continues to focus on whether the US Congress can resolve budget negotiation differences before October 1st to avoid a government shutdown. The hawkish interest rate outlook from the Federal Reserve continues to weigh on market sentiment.

US stocks opened lower and continued to decline, with major indices returning to a downward trend seen in recent days. The Dow Jones hit its lowest level in nearly four months since June 6th and the largest single-day decline since March, closing below the 200-day moving average for the first time since May. The S&P 500 hit its lowest level since June 7th, while the Nasdaq and Russell 2000 hit their lowest levels since May 31st.

Bank of America clients have been net buyers of US stocks for the eighth consecutive week, but retail investors dominate the inflows, while "smart money" such as hedge funds and institutional clients are selling.

Tech giants all experienced declines. Meta dropped 0.6%, Tesla dropped 1%, Google A dropped about 2%, Apple dropped 2.3%, Netflix dropped 1.4%, Microsoft dropped 1.7%, and Amazon dropped 4%. Intel dropped 1.3%, AMD dropped 1.5%, NVIDIA dropped 0.7%, and Arm dropped 1.7%.

Popular Chinese concept stocks followed the decline in the US market. JD.com dropped 2.5%, Baidu dropped 0.8%, Pinduoduo dropped nearly 3%. Alibaba dropped 1.5%, Bilibili dropped 0.4%, Tencent ADR dropped 1.6%, NIO turned up nearly 1%, Li Auto dropped 1.6%, and XPeng dropped 2.6%.

What happened to blue-chip stocks and hot stocks

Guo Mingchi: Apple's mixed reality headset Vision Pro may have lower shipment growth than market expectations

Guo Mingchi, an analyst at TF International Securities, said: 1. Based on the estimated maximum production capacity of some component suppliers, the shipment volume of Vision Pro in 2024 is expected to be at most 400,000 to 600,000 units, which is less than the market's expectation of over 1 million units. 2. Apple may have canceled the plan for a low-priced version of Vision Pro.

Guo Mingchi: Overheating issue of iPhone 15 Pro is unrelated to TSMC's 3nm process

The overheating issue of the iPhone 15 Pro series is likely due to compromises made in the design of the cooling system to make it lighter. If Apple does not properly address this issue, it may adversely affect the shipment volume of the iPhone 15 Pro series throughout its product cycle.

BYD Electronic acquires part of JEP's business located in mainland China BYD Electronics: Jabil Singapore has agreed to sell its product manufacturing business located in Chengdu and Wuxi to BYD Electronics for approximately RMB 15.8 billion (approximately USD 2.2 billion), including the component manufacturing business for existing customers.

Media: OpenAI seeks to sell existing shares at a valuation of up to USD 90 billion

OpenAI is in negotiations with investors to sell existing shares, with a valuation between USD 80 billion and USD 90 billion, nearly triple the valuation earlier this year. Currently, Microsoft holds a 49% stake in OpenAI.

General Motors' autonomous driving company, Cruise, begins fully autonomous driving tests in Houston.

Tesla has adopted integrated die casting technology to achieve rapid molding and reduce costs by 40%.

The rear floor assembly system of the Tesla Model Y produced at the Shanghai Pudong Gigafactory has successfully adopted integrated die casting technology for rapid molding. Compared to traditional methods, the body system saves more than 10% in weight and has significant cost advantages.

US retail giant Target announces the closure of 9 stores.

Target will close nine stores in four states in the United States on October 21 due to organized retail theft that threatens the safety of employees and customers. This is the first major department store retailer to explicitly cite theft as the main reason for large-scale store closures.

FTC and 17 US states join forces to combat e-commerce monopolies: Amazon accused of artificially raising prices and taking nearly half of sellers' income.

The Federal Trade Commission (FTC) and attorneys general from 17 states have accused Amazon of preventing competitors and sellers from lowering prices, punishing sellers who offer low prices, and forcing sellers to use Amazon's delivery and advertising services, stifling innovation. They are seeking a permanent injunction from the court against Amazon's illegal practices.

Pop Mart City Land opens.

Pop Mart City Land, the first immersive IP-themed amusement park in mainland China's trendy toy industry, officially opens in Chaoyang Park, Beijing, covering an area of approximately 40,000 square meters.

Media: JD Auto will trigger a price war.

The specific pricing standard is 5% lower than the overall platform (channel goods) on the entire network. JD Auto will also focus on the lower-tier market and new energy business this year.

Nokia launches "Networks as Code" platform.

Accelerating network programmability and monetization. Nokia and DISH Wireless have agreed to sign a memorandum of understanding to collaborate on ecosystem projects.

India's second-largest IT company, Infosys, partners with Microsoft to launch a generative AI project.

IPO Opportunities

Fourth Paradigm will conduct pre-market trading today and go public tomorrow. Fourth Paradigm Hong Kong's final offering price is HKD 55.60, set at the lower end of the guidance range. Net proceeds are approximately HKD 836 million, and trading is expected to commence on September 28th on the Stock Exchange of Hong Kong. The shares offered in Hong Kong were moderately oversubscribed, at a ratio of approximately 11.40 times. The international offering was oversubscribed by approximately 1.57 times.

Tongfang WeHealth to begin trading tomorrow after grey market transactions today

Tongfang WeHealth: The offering price has been set at HKD 4.76. Net proceeds are approximately HKD 554.5 million. The shares offered in Hong Kong were undersubscribed, at a ratio of only approximately 0.90 times. The international offering was slightly oversubscribed, at a ratio of approximately 1.15 times.

Zhongxu Future receives oversubscription of over 100 times in IPO

Zhongxu Future: The final offering price has been set at HKD 14.00, with net proceeds of approximately HKD 138.1 million. The public offering in Hong Kong was significantly oversubscribed, at a ratio of approximately 104.00 times. The international offering was slightly oversubscribed, at a ratio of approximately 1.67 times.

Cainiao submits listing application to the Hong Kong Stock Exchange

Alibaba announced the spin-off and listing of Cainiao in Hong Kong, and plans to continue holding over 50% of Cainiao's shares after the spin-off. Meanwhile, according to documents from the Hong Kong Stock Exchange, Cainiao has officially submitted its listing application, with Citigroup, CITIC Securities, and JPMorgan as joint sponsors.

Macro: Taking you around the world

"Bondcano" eruption in the US triggers global risk asset impact

US bond yields have surged, especially long-term bonds, leading to what the market calls a "Bondcano" eruption. The 10-year US Treasury yield has risen to 4.5%, and the US dollar index has also climbed to 105.7, marking a rare "ten-week consecutive gain". Whenever there is a disturbance in the anchor of global asset pricing, risk asset prices will be impacted, with the S&P 500 index experiencing a more than 3% decline over two days last week.

US government getting closer to a shutdown on October 1st

The temporary spending bill in the US Senate has obtained enough votes to pass the first procedural hurdle, with voting still ongoing.

Dovish Fed voting member: 40% probability of significant rate hikes by the Fed

Neel Kashkari, President of the Minneapolis Fed, stated that there is a probability of nearly 50% that US interest rates need to be significantly increased in order to reduce inflation.

77.8% probability of the Fed maintaining rates in November

According to CME's "FedWatch", there is a 77.8% probability that the Fed will keep rates unchanged in the range of 5.25%-5.50% in November, and a 22.2% probability of a 25 basis point hike to the range of 5.50%-5.75%.

US President Biden: Agrees that the United Auto Workers should receive a 40% pay increase