The S&P recorded its 20th all-time high this year, Apple fell 4%, its worst in seven months, and gold turned lower after hitting a new high
A lot of economic data is released:
The expectation of interest rate cuts has continued to pick up the U.S. housing market. Total existing home sales rose 9.5% month-on-year to 4.38 million units in February, a one-year high, inventory surged to its highest level since 2020, and median selling prices rose 5.7% year-on-year to a record high of $384,500.
The preliminary Markit manufacturing PMI in the United States in March exceeded expectations and rose to a 21-month high since mid-2022, and the preliminary service PMI hit a three-month low, but both were in the expansion range. The Philadelphia Fed manufacturing index unexpectedly rose in March, with the price index at its lowest level in four years.
The number of initial jobless claims in the United States fell by 2,000 from the previous value after the upward revision last week and was lower than expected, and remained close to record lows.
Business activity in the eurozone improved in March, led by the services sector, but the contraction in Germany's manufacturing sector was "unsettling".
According to analysts, the Federal Reserve's monetary decision on Wednesday showed that the central bank was not too worried about the recent rise in inflation, and maintained the outlook of three interest rate cuts this year unchanged against the backdrop of a still strong labor market, all of which boosted risk sentiment, and traders bet that the probability of a rate cut in June was close to 70%.
More signals from Western central banks to return to accommodative monetary policy:
The SNB unexpectedly cut interest rates, cutting its policy rate by 25 basis points to 1.5%, becoming the first developed country to cut interest rates.
The Bank of Canada expects quantitative tightening to end next year and will no longer buy Canadian mortgage bonds.
The Bank of England kept its benchmark interest rate unchanged at 5.25%, but the two hawks abandoned their support for a rate hike, the first time since September 2021 that no committee member advocated a rate hike, which was interpreted by the market as a dovish signal and opened the door to a rate cut as early as June.
The Bank of England's decision caused the pound to fall against the dollar and the yield on British bonds, and the British FTSE 100 index rose more than 2%. However, the Turkish central bank unexpectedly raised interest rates by 500 basis points to 50% to combat inflation of up to 67%, and the Turkish lira rose in the short term.
U.S. stocks rose for four consecutive days, with the S&P, Dow, Nasdaq, and Nasdaq 100
Both hit new highs, while Apple fell 4%
Seven months worst
On Thursday, March 21, the day after the Federal Reserve maintained its "dovish" guidance of three interest rate cuts this year, the three major U.S. stock indexes collectively opened higher "as scheduled", with the Dow and Nasdaq opening up 150 points with the help of large technology and chip stocks, and then both hit new intraday highs in history.
The Dow rose nearly 380 points, or about 1%, Goldman Sachs and Home Depot rose 3% to lead the constituents, the S&P 500 rose as much as 0.7%, the industrial and banking sectors led the way, and the Nasdaq and Nasdaq 100 also rose as much as 1%. The Russell 2000 small-cap index, which rose nearly 2% yesterday and had its best performance in more than a month, led the way again, rising as high as 1.5% at the beginning of the session.
The S&P 500 closed up 16.91 points, or 0.32%, at 5,241.53. The Dow closed up 269.24 points, or 0.68%, at 39,781.37. The Nasdaq closed up 32.43 points, or 0.20%, at 16,401.84.
The Nasdaq 100 rose 0.44%, and the Nasdaq Technology Market Cap Weighted Index (NDXTMC), which measures the performance of technology constituents in the Nasdaq 100, closed up 0.46%, the highest since March 7.
The Russell 2000 small-cap index rose 1.14%, the biggest gain among major indices for the second day in a row and the highest in nearly two years since April 4, 2022. The "fear index" VIX fell 1% and fell below 13.
Major U.S. stock indexes hit new closing highs, but Apple's decline narrowed the Nasdaq's gains significantly in late trading
According to some analysts, the expectation that major central banks in Europe and the United States are expected to cut interest rates this year has made the stock market continue to rise, and it has also strengthened investors' optimism about corporate earnings. Société Générale raised its year-end target for the S&P market from 4,750 to 5,500 in the context of "improving corporate earnings prospects and the AI boom", making it the most optimistic investment bank on Wall Street. But UBS warned that gains in big tech stocks could not be sustained.
Most of the star tech stocks fell. "Metaverse" Meta rose 0.4%, Amazon erased a 1.8% gain to close flat, Microsoft rose about 1%, Netflix fell 0.8% to the highest since the end of 2021, Apple closed down 4.1% out of the monthly high, and hit the worst performance in seven and a half months since August 4 last year, with a market value loss of more than $110 billion, Google A turned down 0.8%, and Tesla fell 1.6%.
Apple closed down 4.1%, its worst one-day performance since August last year
Chip stocks rose together, but the gains were halved in the afternoon. The Philadelphia Semiconductor Index closed up 2.3%, up as high as 4% intraday, approaching the 5,000-point integer psychological mark and the highest intraday record set on March 8 on the non-farm payrolls. Nvidia rose 1.2%, rising for four consecutive days to approach the all-time high set on March 7, Nvidia doubled long ETF rose 2%, Intel rose 0.5%, TSMC U.S. stocks rose about 2%, but AMD opened 4.4% higher and then fell 0.6% to refresh a three-week low; Micron Technology rose more than 14% to the best performance since December 2011, and Broadcom rose 10% to close up 5.6%.
AI concept stocks turned lower after midday. Palantir fell 0.3%, Oracle fell 0.1% to stop a three-day streak high, C3.ai fell nearly 1%, Adobe fell 1.5%, SoundHound.ai fell nearly 16%, and BigBear.ai fell nearly 4%. However, ultra-micro computers rose more than 8% to end a five-day losing streak, and Silicon Valley artificial intelligence infrastructure hardware unicorn Astera Labs rose as much as 29%, doubling the opening price of the first day of IPO on Wednesday.
On the news side, the Biden administration officially sued Apple for anti-monopoly, saying that the iPhone, smart watches, payments and other ecosystems have monopolies, which once made the "seven sisters of large technology stocks in the United States" give up their gains. There are also reports that the EU will target Apple and Google in the first Digital Markets Law investigation, which may lead to heavy penalties, and the next step may be to investigate Meta.
Micron Technology, a leader in memory and memory chips, exceeded expectations in its second-quarter earnings and revenue, with revenue increasing nearly 58% year-on-year, and net profit turning losses into profits year-on-year, and said it benefited from the multi-year opportunities opened up by artificial intelligence. TD Cowen upgraded Broadcom to outperform, emphasizing further potential upside in the AI business, and the investment bank also raised Nvidia's price target to $1,100 and reiterated its overweight rating.
The decline of the Chinese concept stock index deepened after midday. ETF KWEB fell 1.7%, CQQQ fell 2.6%, and the Nasdaq Golden Dragon China Index (HXC) fell 1.6%, re-approaching a one-week low, after closing up 1.9% yesterday and outperforming the broader U.S. stock market throughout the day.
Popular stocks fell, JD.com fell 3.9%, Baidu fell more than 2%, Pinduoduo fell 7.5%, Alibaba fell 0.5%, Tencent ADR fell 1%, Bilibili fell 8.8%, NIO fell nearly 2%, Li Auto, which lowered its first-quarter delivery guidance, fell 7.5%, and Xpeng Motors fell 3%. However, Lufax Holdings, which plans to pay a special dividend of about 10 billion yuan, rose nearly 46%. Alibaba will reportedly sell Bilibili ADRs, which are expected to be priced at $11.60 per ADR, with a potential realisation of $357.8 million
Bank stocks extended yesterday's gains. The Philadelphia Stock Exchange's KBW Bank Index (BKX), the industry benchmark, rose 2.2% for five consecutive days to hit its highest level in a year since the industry crisis in March last year, while the KBW Nasdaq Regional Bank Index (KRX) rose 1.4% after jumping 3% yesterday.
Other stocks that have moved more include:
Reddit, the "American Tieba" concentrated in retail investors, rose as much as 70% on the first day of listing and closed up more than 48%, which is the first mainstream social media IPO since 2019, and the issue price of $34 announced overnight is at the upper end of the guidance range, with a valuation of about $6.5 billion.
Two economic leaders, FedEx Express and Nike, report earnings after hours. FedEx's operating profit exceeded expectations, narrowing the performance guidance range, and the stock price rose more than 11% after hours, driving UPS to rise 3%. Nike's revenue exceeded expectations, rising more than 2% after hours.
European stocks rose, the pan-European Stoxx 600 closed up 0.90%, hitting a record high in intraday and closing, the German stock index hit a new high for three consecutive days, the British stock index rose the most in half a year, and the French stock index were close to record highs. Falling nearly 12% yesterday, Gucci's parent company Kering fell more than 1%, and Dior rose 2.5%. Among the European stocks "Eleven Arhats", ASML rose about 5.6%, and SAP hit a new closing high, while Roche fell more than 2.5%.
U.S. bond yields fell first and then rose, European bond yields collectively fell, and British bond yields once plunged by double digits
Before the U.S. stock market, the two-year and 10-year U.S. Treasury yields fell 4 basis points together, and the U.S. stock market turned up again at the beginning of the session, and after the Federal Reserve's monetary policy announcement yesterday, the two-year U.S. Treasury yield plunged 9 basis points to a daily low in the short term.
The yield on the two-year Treasury note, which is more sensitive to monetary policy, rose as much as 4 basis points to 4.64% during the U.S. stock session, off a one-week low. The yield on the 10-year base bond rose more than 2 basis points to 4.29% at one point, still giving up nearly half of the gains since last Thursday, and hit its highest since late November last year at 4.35% intraday on Monday.
U.S. Treasury yields fell first and then rose
The yield on the 10-year German bond, the eurozone's benchmark, fell nearly 3 basis points, the two-year yield fell 5 basis points, and the SNB briefly fell below 2.85% after announcing a rate cut. After the Bank of England's monetary decision was announced, the yield on the interest-sensitive two-year Treasury bond plunged by 11 basis points, and the yield on the 10-year bond fell by 7 basis points, narrowing significantly at the end of the session.
Oil prices fell for two consecutive days, down 1% intraday
It basically erased the weekly gains, and European natural gas also fell for two consecutive days
International oil prices fell for two consecutive days, further away from the nearly five-month high set on Tuesday since late October last year.
WTI crude oil futures for May delivery closed down $0.20, or more than 0.24%, at $81.07 a barrel. Brent crude oil futures for May delivery closed down $0.17, or about 0.20%, at $85.78 a barrel.
U.S. oil WTI fell about $1 or 1.2% during the day, falling below $81. International Brent fell as deep as $0.89 or 1%, the daily low of $85 and continued to be less than $86, all of which basically erased the weekly gains.
Oil prices fell for two consecutive days, down 1% intraday
According to some analysts, this is mainly due to the fact that the euro area, which is one of the world's largest crude oil importers, is still in contraction, led by major economies Germany and France. But the fundamentals of tighter supply sides such as Russia and OPEC+ have not changed.
TTF Dutch natural gas futures, the European benchmark, fell more than 5% for two consecutive days, falling below 27 euros/MWh, basically giving up weekly gains, and ICE British natural gas fell the deepest 4.6% for two consecutive days. U.S. natural gas futures fell another 2% intraday, returning to their monthly lows.
The dollar regained at 104
to a two-week high, the pound fell 1%
, less than 151 yen
, Bitcoin rose above 6.7
$10,000 and then turned lower
The DXY index, a basket of six major currencies, turned higher and returned above the 104 mark, hitting a two-and-a-half-week high since March 1, after falling to a daily low overnight after the Fed's decision yesterday.
The U.S. dollar erased yesterday's losses and returned to a two-week high
EUR/USD retreated from a one-week high, largely erasing yesterday's gains and falling below 1.09. GBP/USD fell more than 120 pips, or 1%, to a two-week low of 1.27. The yen is still below the 151 mark against the dollar, close to yesterday's four-month low and close to the low level since the bursting of Japan's asset bubble in June 1990. The offshore yuan fell more than 110 points against the US dollar and fell to 7.22 yuan.
Mainstream cryptocurrencies open higher and move lower. Bitcoin, the largest leader by market capitalization, rose above $67,000 in the pre-market and fell to $65,000 in late trading, and after hitting a record high of nearly $73,798 last week, it fell below $61,000 on Wednesday, and its market value evaporated by about $200 billion. Ethereum, the second-largest Ethereum, briefly rebounded 11% from its lows and rose above $3,500 before falling back to $3,400.
Digital currencies opened higher and moved lower, with Bitcoin rising above $67,000 before turning lower
Spot gold rose above 2200
The dollar turned lower after hitting a new high, and silver fell nearly 4% at one point
, London aluminum rose more than 1%
, tin rose more than 2%
COMEX gold futures for April delivery closed up 1.10% at $2,184.70 an ounce. COMEX silver futures for May delivery closed down 0.39% at $25.007 an ounce. Spot silver fell as much as 3.7% and fell below $25 an ounce, completely erasing yesterday's gains.
Spot gold rose nearly $36, or 1.6%, in pre-market trading on Thursday, rising above $2,222 and $2,200, a record high. U.S. stocks reverted lower after midday and pushed down to $2,180.
Spot gold rose above a record high of $2,200 before turning lower
Aakash Doshi, head of North American commodity research at Citi, believes that the rally in gold prices will continue, and as the Federal Reserve cuts interest rates, it may rise to a new high of $2,300 an ounce in the second half of this year. State Street believes gold will hit $2,400 as a result.
The appeal of gold as a safe-haven asset and investors seeking to diversify their portfolios when other asset classes underperform have also driven strong physical demand for gold, according to analysts.
Industrial base metals rose in London. The economic bellwether "Dr. Copper" closed up 0.2%, standing above the $8,900 integer level, halting a two-day losing streak and rising above $9,160 on Monday to hit an 11-month high. London aluminum rose more than 1.2%, London zinc rose 0.6%, London lead fell slightly, London nickel continued to rise slightly, London tin rose 2.4%, re-approaching a seven-month high, rising for the fifth day in seven days.