U.S. stocks close: Powell fell interest rate cut expectations again, the S&P Nasdaq rebounded and lost, and the Dow ended a six-game losing streak

Wall Street Sights

2024-04-17 06:32Posted on the official account of Shanghai Wall Street

Fed Chair Jerome Powell was "hawkish" on Tuesday, saying recent data showed that "there has been a lack of further progress so far this year on inflation falling back to the Fed's 2% target." Powell hinted that the Fed may keep its policy rate, which is currently at a high level in more than two decades, for longer, saying that recent data "clearly not" the Fed's confidence in bringing inflation down and that it may take longer to be more confident.

Powell's comments on inflation further weakened market bets on a Fed rate cut. After his speech, the decline in US Treasury prices accelerated and the rise in yields widened. The yield, the interest-sensitive two-year Treasury note, broke through the 5.0% mark again after last Thursday, updating last week's highest level since November, and the yield on the benchmark 10-year Treasury note approached a five-month high set earlier on Thursday.

The market expects the Fed to cut interest rates by a total of 40 basis points this year

The market expects less than 20% of the Fed to cut interest rates in June, and less than 50% in September and December

After Powell's speech, the two major U.S. stock indicators, the S&P and the Nasdaq, extended their losses, and the Dow maintained its gains, benefiting from the surge in medical and health giant UnitedHealth, which reported a larger-than-expected revenue growth of more than 8% in the first quarter. Some tech giants continued to fall, dragging down the market, chip stocks rebounded, Nvidia and AMD, which released AI PC chips, both rose more than 2% intraday, but Tesla continued to fall after it was rumored that it would lay off more than 10% of its global workforce, and research institute data showed that iPhone shipments fell nearly 10% in the first quarter after a sharp drop of nearly 10%, and Apple fell more than 2% intraday for the second consecutive day.

Morgan Stanley, whose net profit increased by 14% in the first quarter and revenue also increased by more than expected, rose nearly 5%, while the stock price of Bank of America, which fell by 18% in the first quarter and the high cost of deposits, dragged down the net interest income (NII), an important source of income, fell by 3% year-on-year, the largest intraday decline in more than a year since the collapse of Silicon Valley Bank.

In the currency market, after Powell assessed that inflation was not progressing enough, the dollar index rose rapidly, hitting a new five-month high, and the yen continued to hit a new low against the dollar since 1990. The commentary pointed out that the yen rebounded about 0.5% in early trading in the United States, which may be the result of traders becoming more sensitive to the risk of Japanese government intervention, not the official end, and strategists warned that the impulse to buy the yen at the bottom of the currency market is still strong, and the first sudden rally in the yen will be more sensitive to the yen when the yen is close to the milestone level of 155 against the dollar. Bitcoin continued to fall, falling below $62,000 intraday, near a more than three-week low of $61,000 after Iran's attack on Israel over the weekend, but the decline eased from Monday.

Among commodities, the dollar strengthened as London copper, which rose on Monday after the British and US imposed a ban on Russian metal trading, retreated, and London aluminum barely held on to the gains. Geopolitical risks continued to support gold, but the US dollar limited gold price gains, and New York gold futures continued to hit new closing highs, still failing to refresh intraday record highs. According to the commentary, if the conflict in the Middle East is degraded, the market focus will turn to the Federal Reserve, and it is obvious that the Federal Reserve will not cut interest rates soon, which will be negative for precious metals gold and silver. International crude oil failed to rebound successfully with the help of geopolitical risks, and closed down for several days. U.S. Treasury Secretary Janet Yellen said the U.S. will impose new sanctions on Iran in the coming days. Commentary said this could weaken Iran's ability to export oil, while the third meeting of Israel's wartime cabinet in three days appeared to be postponed by one day to Wednesday as Western countries hoped that sanctions against Iran would help organize a serious escalation in the Middle East.

The S&P Nasdaq fell three times in a row, and Tesla fell the first in two days among the "seven sisters" of technology, and chip stocks rebounded after the earnings report

The three major U.S. stock indexes were mixed at the open and intraday. The S&P 500 index, which opened slightly higher, turned lower at the beginning of the session, falling more than 0.4% in early trading when it refreshed its daily low, and after Powell's speech at midday, it first turned higher and refreshed its daily high, rising nearly 0.4% in the day, and then quickly turned lower and forced a recent low. The Nasdaq Composite Index, which opened lower, fell nearly 0.4% in early trading when it refreshed its daily low, and then turned up several times, and after Powell's speech, it turned up and refreshed its daily high, rising 0.5% in the day, and was close to the daily low after turning down again. and the S&P both turned lower in late trading after turning higher. The Dow Jones Industrial Average maintained its rally throughout the day, refreshing its daily high shortly after opening, rising nearly 260 points or 0.7% during the day, rising less than 40 points in early trading, and narrowing its decline to more than 20 points after Powell's speech at midday, refreshing the daily low, and then expanding its gains to more than 100 points.

In the end, among the three major indexes, only the Dow closed higher, ending a six-day losing streak, the S&P and Nasdaq fell for three consecutive days, and the S&P did not fall more than 1% on the first day. The Dow Jones was 63.86 points, up 0.17%, at 37,798.97 points, off the closing low since January 18, which was refreshed by consecutive declines. The S&P closed down 0.21% at 5,051.41 and the Nasdaq closed down 0.12% at 15,865.25, both of which refreshed their closing lows since Feb. 21 for two consecutive days.

The Russell 2000, a small-cap index dominated by value stocks, closed down 0.42%, underperforming the broader market, falling for three consecutive days and refreshing its lowest level since February 13 for two days. The tech-heavy Nasdaq 100 index closed up 0.04%, after falling more than 1% in the previous two days since its lowest level since Feb. 21. The Nasdaq Technology Marketcapitalization-Weighted Index (NDXTMC), which measures the performance of the technology constituents in the Nasdaq 100, closed up 0.26%, rebounding on Monday after updating its low since March 15.

Among the three major U.S. stock indexes, only the Dow closed higher, the S&P Nasdaq turned lower at the end of the session, and the small-cap stock index underperformed the broader market

Among the Dow constituents, UnitedHealth (UNH) led the gains, rising nearly 7.7% at the beginning of the session and closing up 5.2%, and Salesforce (CRM), the cloud software giant that fell more than 7% on Monday, rose more than 2% at midday and closed up nearly 1.7%, second only to UNH, while Johnson & Johnson (JNJ), whose first-quarter revenue was in line with expectations and profits higher than expected, closed down 2.1%, the largest decliner, followed by Apple's decline.

Among the major sectors of the S&P 500, only IT, which rose more than 0.2%, IT, which rose less than 0.2%, consumer staples, which rose less than 0.1%, and UnitedHealth, which rose slightly, did not close down, while interest-rate sensitive real estate fell more than 1.5%, utilities fell nearly 1.4%, and other sectors fell less than 0.9%.

Including Microsoft, Apple, Nvidia, Google's parent company Alphabet, Amazon, Facebook's parent company Meta, and Tesla, the "seven sisters" of tech giants are mixed. Tesla, which fell 5.6% on Monday to record the biggest decline since January 25, fell for two consecutive days, falling nearly 4.8% at the beginning of the session, falling more than 3% at midday, and closing down 2.7%, falling for three consecutive days and refreshing the closing low since April 26, 2023.

Among the six major technology stocks of FAANMG, Apple only turned up in the short term in early trading throughout the day, falling more than 2.5% at the beginning of midday, falling more than 2% in two days, and closing down 1.9%, approaching the lowest level since October 26, 2023 set last Wednesday; Alphabet closed down 0.3%, falling for three consecutive days to the lowest level since April 5; Amazon closed down nearly 0.2%, falling for three consecutive days, refreshing the low since April 4 for two days; Meta closed down less than 0.1% , two days to refresh the low since April 2, while two consecutive declines Microsoft and Netflix maintained gains throughout the day, Monday refreshed the low since March 11 Microsoft closed up 0.2%, Monday refreshed the low since March 15 Netflix closed up 1.7%.

Chip stocks rebounded overall, and the Philadelphia Semiconductor Index and the semiconductor industry ETF SOXX turned down in the short term at the beginning of the session, rising more than 1% at midday, closing up nearly 0.9% and 0.8% respectively, out of the closing low since February 28, which fell for two consecutive days. Among chip stocks, Nvidia, which fell for two consecutive days on Monday and approached the low closing level since March 11 last Tuesday, maintained its rally throughout the day, rising more than 2% at midday and closing up 1.6%; AMD, which launched its first commercial AI-powered desktop chip and made efforts in the field of AI PCs, also rose more than 2% at midday and closed up nearly 2%; Broadcom closed up more than 1%, Micron Technology rose 0.3%, and Intel, which fell more than 1% at the beginning of the session, closed down more than 0.1%, and TSMC U.S. stocks fell 0.2%.

Tesla, Nvidia and other seven major technology stocks on Tuesday fell significantly less than on Monday

Bank stock indices fell in unison. The overall banking sector benchmark KBW Bank Index (BKX) closed down 1.6%, falling back to its lowest closing level since March 1 after rebounding on Monday, the regional banking index KBW Nasdaq Regional Banking Index (KRX) closed down nearly 1.4%, and the regional bank stock ETF SPDR S&P Regional Bank ETF (KRE) closed down nearly 1.3%, falling for three consecutive days to update the closing lows since November 28 and November 30, 2023, respectively.

Among the big banks, after the release of the earnings report, Morgan Stanley rose more than 4.7% at the beginning of the session and closed up nearly 2.5%, Bank of America quickly turned lower at the beginning of the session, falling about 5% in early trading, the largest intraday decline since March 2023, closing down 3.5%, at the close, Citi fell 2.6%, JPMorgan Chase fell 1.1%, Goldman Sachs, which closed nearly 3% after Monday's earnings report, fell nearly 1%, and Wells Fargo also fell nearly 1%.

Morgan Stanley rose after earnings reports, Bank of America fell, and Citi has continued to fall since Friday's earnings report

Popular Chinese concept stocks continued to fall overall, underperforming the broader market. The Nasdaq Golden Dragon China Index (HXC) closed down nearly 1.3%, falling for two consecutive days and refreshing its closing low since February 13. Chinese ETFs KWEB and CQQQ closed down about 1.5% and 1.8%, respectively. The new car-making forces fell together, Xiaomi Fan Shan closed down nearly 2%, Weilai Automobile fell more than 2%, Li Auto fell nearly 0.7%, and Xpeng Motors fell 0.4%. Among other stocks, at the close, caviar product supplier Fuyuan Group ADR (TWG) fell 51.50% on the first day of listing in the United States, Station B fell more than 2%, NetEase fell nearly 2%, Alibaba, JD.com fell more than 1%, Pinduoduo fell nearly 0.7%, Tencent Pink Sheet fell 0.2%, and Baidu fell less than 0.1%.

Live Nation Entertainment (LYV), an entertainment company that produces promotional concerts, fell more than 9% at the beginning of the session and closed down nearly 7.6% after the media said that the U.S. Department of Justice would file an antitrust lawsuit against it, while United Airlines (UAL), which closed up 1.1%, reported a lower-than-expected EPS loss in the first quarter, higher-than-expected revenue, and higher-than-expected second-quarter profit guidance, and its stock price jumped after hours, once rising more than 6%.

In European stocks, high interest rates and concerns about the escalation of the Middle East conflict weighed on investor sentiment, and the pan-European stock index, which had rebounded for two consecutive days, fell sharply. The Euro Stoxx 600 index closed down more than 1.5%, its biggest daily drop since July 5, 2023, and the lowest closing level since March 6. Stock indexes of major European countries all fell, falling at least more than 1%, led by British stocks that fell nearly 2% for two consecutive days, and German and French stocks that rebounded on Monday, as well as Italian and Spanish stock indexes that rose for two consecutive days, all retreated.

Among the sectors, the underlying resources of the mining stocks affected by the retreat in copper prices closed down about 3%, the biggest drop since mid-August last year, and the banking sector fell about 2.5%, also the biggest decline since August last year, affected by the UK's largest bank HSBC and the eurozone's largest bank BNP Paribas, both closed down nearly 3%.

After Powell's speech, the two-year Treasury yield rose above 5.0% intraday, hitting a five-month high

The U.S. 10-year benchmark Treasury yield hit a new high since November last year for the fourth day in the last five trading days, and the U.S. stock market had tested 4.70% at the beginning of the session, refreshing the high since November 13, 2023 for two consecutive days, rising more than 9 basis points in the day, and the rise narrowed in early trading, breaking below 4.65%, and the rise expanded again after Powell's speech at midday, once rising above 4.69%, approaching the high set at the beginning of the session, and about 4.67% at the end of the bond market , up about 7 basis points in the day, up for two consecutive days, and climbed for the fourth day in the last five trading days.

U.S. Treasury yields of all maturities rose for two consecutive days, while short-term bond yields rose relatively at the bottom

The 2-year Treasury yield, which is more sensitive to the outlook for interest rates, rose above 4.73% at the beginning of the U.S. stock market and returned to below 4.95% in early trading.

The two-year Treasury yield rose above 5.0% intraday, the highest since November last year

The U.S. dollar index hits another five-month high and its biggest five-day gain in a year and a half The yen hit a new low since 1990 for five consecutive days

The ICE U.S. Dollar Index (DXY), which tracks a basket of six major currencies against the euro, fell below 106.10 to refresh the daily low after the European stock market turned lower in the intraday, falling more than 0.1% in the day, and the U.S. stock market turned up slightly in early trading several times after the pre-market rally, and quickly rose above 106.50 after Powell said that there was no progress in the decline in inflation, and refreshed the high since November 1, 2023 for two consecutive days, hitting a new five-month high for three consecutive days, and rising nearly 0.3% in the day.

By the close of trading on Tuesday, the U.S. dollar index was below 106.40, up nearly 0.2% on the day, and the Bloomberg dollar spot index, which tracks the exchange rate of the U.S. dollar against ten other currencies, rose nearly 0.4% during the day, updating its highest level since November 2023 for four consecutive days, and the U.S. dollar index both rose for five consecutive days, the biggest five-day gain since October 2022.

The Bloomberg Dollar Spot Index rose for five consecutive days and hit a five-month high, forming a golden cross where the 50-day moving average exceeded the 200-day moving average

Among the non-US currencies, the yen continued to hit a new low since 1990 intraday, and the USD/JPY approached 154.80 at midday after Powell's speech, hitting a new high since 1990 for the fourth consecutive trading day, rising more than 0.4% in the day, and the euro against the US dollar was tested at 1.0600 after Powell's speech, refreshing the low since the end of October 2023 on three days, falling nearly 0.2% during the day The pound fell below 1.2410 against the dollar after Powell's speech, updating the lowest level since November 17, 2023, falling 0.3% on the day and down about 0.1% at the close.

The offshore yuan (CNH) refreshed its daily high against the US dollar at 7.2589 at the beginning of the Asian market, fell to 7.2831 in early trading, and refreshed the low since November 13, 2023, falling 241 points in the day, and then rebounded in shock, with US stocks recovering 7.27 in early trading, and the intraday decline in US stocks narrowed to less than 40 points at the end of the day. At 4:59 a.m. on April 17, Beijing time, the offshore yuan was quoted at 7.2644 yuan against the U.S. dollar, down 54 points from the end of New York on Monday, equivalent to 187 points narrower than the intraday decline at the low of the day, and fell back after rebounding on Monday.

Bitcoin (BTC) was above $69,300 in early Asian trading to refresh the daily high, European stocks fell below $61,800 to refresh the daily low, to the weekend fell below $61,000, some platforms fell below $60,900 to refresh the low since March 20, down more than $2,000 from the daily high, down more than 3% After the rebound, the U.S. stock market regained $63,000 before the market, the U.S. stock fell another $62,000 in early trading and once approached a daily low, and the midday re-$63,000 was regained, and the U.S. stock closed above $62,700, down more than 1% in the last 24 hours.

Crude oil rebounded and lost two consecutive losses

International crude oil futures turned lower intraday. When the Asian market refreshed its daily high on Tuesday, the U.S. West Texas Intermediate (WTI) crude oil was close to $86.20, up nearly 0.9% during the day, up above $90.80, Brent crude oil rose more than 0.8% during the day, and when the European stock market turned down before the U.S. stock market refreshed the daily low, U.S. oil fell below $84.80, and cloth oil approached $89.40, down nearly 0.8% during the day.

As a result, crude oil, which rebounded on Friday, closed lower for two consecutive days. WTI crude oil futures for May delivery closed down $0.05, or nearly 0.06%, at $85.36 a barrel, continuing to fall to the lowest level since April 1, which was refreshed last Thursday, while Brent crude oil futures for June delivery closed down $0.08, or about 0.09%, at $90.02 a barrel, narrowly holding the $90 mark and closing above $90 for two consecutive days.

U.S. WTI crude oil turned up several times during the session, and finally closed slightly lower

London copper fell more than 1%, bidding farewell to the high level of the past two years, London aluminum hit a 14-month high, and gold closed at a record high on four days

Base metals futures in London mostly fell on Tuesday, as gains were curtailed after the United States and Britain imposed a trading ban on some Russian metals. London copper, London lead, and London tin all fell by more than 1%. London copper and London lead, which have risen for two consecutive days, fell to their highs since June 2022 and November last year, respectively, and London Xi continued to fall from the highs since June 2022 set by last Friday's rebound. London zinc, which rose for five consecutive days last Friday to the highest level since April last year, fell for two consecutive days, and London nickel, which rebounded on Monday, fell back to a low level of more than a week. On Monday, London aluminum, which rose more than 2%, rose slightly, rising for three consecutive days, hitting a new high since February last year.

New York gold futures basically maintained their gains on Tuesday, only in the pre-market European stocks and early U.S. stocks had a short-term turn down, U.S. stocks rose to $2414.8 at midday to refresh the daily high, up more than 1.3% in the day, and did not approach the intraday all-time high set by last Friday's rise to $2448.8. Spot gold rose above $2,398 in midday trading after U.S. stocks turned higher in early trading, rising more than 0.6% during the day, and still not close to the intraday all-time high set by Friday's rise above $2,431.

Spot gold has significantly eased its rally from Monday and failed to hit a record intraday high

However, both futures and spot gold continued to refresh their closing record highs. COMEX June gold futures closed up 1.04% at $2,407.8 an ounce, up for four consecutive trading days and hitting a record closing record for four consecutive days. At the close of U.S. stocks, spot gold was just below $2,390, up nearly 0.3% on the day, continuing to refresh the record high set at the same time last Thursday.

Spot gold continued to hit new closing highs on Tuesday

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