European and American economic data are poor, dragging down risky assets performance. The US manufacturing and service industry PMI fell significantly in May, and the Richmond Fed manufacturing industry plummeted to negative values. Affected by the dual impact of high housing prices and sharp rise in mortgage interest rates, new home sales in the United States hit the biggest drop in nearly nine years in April, reaching the lowest point since the outbreak of the epidemic, and the home builder confidence index fell for five consecutive months in May. The eurozone manufacturing and service industry PMI in May, which was counted by S&P Global, also fell month-on-month, both of which aggravated market concerns about slowing global economic activity.
Federal Chairman Powell spoke on Tuesday but did not comment on FOMC's monetary policy. Among other Fed officials who spoke, Esther George, the FOMC voter and Kansas City Fed Chairman, predicts that the United States will raise interest rates to 2% by August, and the further tightening process depends on the degree of inflation cooling. The following year, the Parliament Committee and Atlanta Fed Chairman Raphael Bostic continued to "leave doves" and urged the Fed not to "recklessly" tighten its policies. Yesterday he suggested stopping interest rate hikes in September.
European Central Bank President Lagarde reiterated on Tuesday that the ECB deposit facility rate is expected to rise to zero or "slightly above zero" by the end of September, meaning at least 50 basis points higher than current levels. Neither she nor the French central bank governor would support a sharp 50 basis point rate hike, but the Austrian and Latvian central bank governors today called for the possibility of a 50 basis point rate hike should not be ruled out under high inflation.
The minutes of the Federal Reserve's May meeting released on Wednesday will give investors a deep understanding of the Fed's design ideas for the tightening path. The US core PCE price index released on Friday is the inflation target that the Federal Reserve is more concerned about. It is expected to rise for 17 consecutive months but the month-on-month growth rate slows. The final value of the University of Michigan’s consumer confidence index and inflation expectations in May also attracted much attention, and consumer spending is the main pillar of the U.S. economy.
Snap Financial report warning scares technology stocks , Nasdaq fell more than 2% to 18html the lowest in 3 months, the Dow Jones Industrial Average turned rising at the end of the trading session, European stocks fell more than 1%
European and American economic data are disappointing, social media company Snap issued a second-quarter profit warning citing macroeconomic factors such as inflation to suppress technology stocks. Investors are worried that major central banks will turn their hawks and trigger an economic recession, risk sentiment has receded significantly, US stocks and reversed yesterday's rise, and European and American bonds and gold rose.
On Tuesday, May 24, following the decline in the Eurasian stock index, the US stock market opened sharply lower, Nasdaq opened and fell 1.8%, S&P 500 index fell 1%, and the Dow Jones fell more than 150 points. The market sells widely, with 457 of the S&P 500 components falling. Internet stock index, optional consumption, global aviation and semiconductor ETFs ranked the top in declines, while defensive sectors such as utility ETFs rose slightly against the market.
Before midday trading, the decline in US stocks expanded rapidly. Five minutes into the opening, the Nasdaq fell by more than 2%. Half an hour after opening, the Nasdaq index fell to 3.3%, the S&P fell 1.7%, and the Dow Jones fell more than 200 points. The U.S. stock market hit a daily low for one and a half hours, and the decline narrowed after midday, and the Dow Jones Industrial Average turned higher.
The Dow Jones Industrial Average fell by more than 510 points during the day or fell by 1.6%, while the S&P fell by nearly 100 points or fell by 2.5%, losing 3,900 points. The Nasdaq, which is mostly technology stocks, fell by more than 440 points or fell by 3.8%, down by 11,000 points. The Nasdaq 100 fell by nearly 460 points or fell by 3.8%, losing 12,000 points. The Russell 2000 small-cap index, which is mostly value stocks, fell by 3.2%.
As of the close, the S&P 500 index broke away from the lowest level since March 2021 set in the session, closing down 32.27 points, a drop of 0.81% to 3941.48 points, down more than 18% from the 52-week high set in early January, once again forcing the technical bear market that fell into during the session last Friday. The Dow Jones Industrial Average closed up 48.38 points, or 0.15%, to 31,928.62 points. The decline was increased for three consecutive days and recovered for more than half of the week. The Nasdaq closed down 270.83 points, or 2.35%, to 11,264.45 points. The Nasdaq 100 closed down 264.44 points, or 2.2%, to 11,769.84 points, both the lowest since November 2020, and Russell's small-cap stocks closed down 1.56%, closer to erasing the gains since May 12.
Star technology stocks generally fell and the decline narrowed in the late trading. "Metauniverse" Meta fell more than 9%, and then closed down 7.6% to a new low in a month. Amazon closed down more than 3% after falling nearly 6%, hitting a 52-week low and its lowest since April 2020. Apple closed down nearly 2% after falling more than 3%, close to its lowest since July 2021 last Thursday.Microsoft fell 2.7% and closed down 0.4%, Netflix fell 5.5% to a one-week low, and Google parent company Alphabet fell 8.6% to a 52-week low, closing down nearly 5% to its lowest since March 2020. Tesla fell nearly 7% to its lowest since June last year. However, the cloud video conferencing company Zoom, which released its positive financial report yesterday, rose 5.6% against the market.
Meta, Amazon and Google led the decline in technology stocks, which is related to the market's concerns about the slowdown in the entire digital advertising industry after social media company Snap issued a financial report warning because of the "deterioration of the macroeconomic environment beyond expectations." Snap fell 43% to the largest single-day decline since its listing in 2017 and its stock price fell below the issuance. Many analysts say this is a macro dilemma for the entire industry, and both Internet and digital advertising technology stocks have been hit hard. The market value of social media stocks evaporated by more than US$160 billion. Before the epidemic, the standard ordinary letter sector fell by nearly 6% during the session and led the decline:
Roku fell by more than 17%, setting a new 52-week low to its lowest since May 2019. Pinterest fell by more than 23%, setting a new 52-week low to its lowest since April 2020. Twitter fell more than 5% to a two-month low. Among advertising technology stocks, Trade Desk fell by more than 18% to its lowest since September 2020, Magnite fell by more than 13% to a two-week low, and PubMatic fell by nearly 16% to a new low after listing. Omnicom Group once fell more than 12% to its lowest since December last year, and Interpublic Group of Companies once fell more than 11% to a new 15-month low.
chip stocks generally fell. The Philadelphia Semiconductor Index fell by more than 100 points or fell 3.5%, once falling below the 2,800-point integer, closing down 2.5% to its lowest in the two-week period since May 11. Intel fell 0.8%, AMD and Nvidia fell more than 4%, and Broadcom fell nearly 2%. It said it may announce its acquisition of cloud computing company VMWare on Thursday for cash and stocks of about $140 per share, which fell 4% intraday.
Last week, Walmart and Target, among the top major retail department store giants in the United States, reported poor first quarterly reports. Investors are worried that this indicates that high inflation is eroding consumer spending and is unfavorable to the economy. Retailers' financial reports continue to become the focus of attention this week. Apparel maker Abercrombie Fitch fell nearly 28%, setting a new 52-week low to its lowest since November 2020, with unexpected losses in the first quarter and weak guidance for the whole year. Consumer 3C retail giant Best Buy closed up more than 1% after turning down, with sales falling in the first quarter but better than expected, and the company said it did not predict a recession.
Nordstrom released its financial report after the market, showing that the growth rate of net sales in the first quarter doubled compared with analyst expectations, raising its annual revenue and EPS growth guidelines, and once rose by more than 20% after the market.
Popular Chinese stocks followed the US stock market and fell. Chinese ETF KWEB fell 6.9%, CQQQ fell 5.6%, and Nasdaq Golden Dragon China Index (HXC) fell 6.6%. Among the four Nasdaq 100 stocks, JD.com fell 7%, Baidu fell 6.7%, Pinduoduo fell 8.6%, and NetEase fell 1.7% after releasing its financial report. Among other stocks, Alibaba fell 5.5%, Tencent ADR fell 3.7%, Bilibili fell nearly 12%, and the "three fools in car manufacturing" fell more than 7% across the board.
Worried about the selling wave of recession sweeping the world, European stocks stopped two consecutive gains and fell from the weekly high they set yesterday. The Pan-European Stoxx 600 index closed down 1.14%, with both retail and travel and leisure sectors falling 3% and leading the decline, technology stocks falling 2.5%, and the euro zone Stoxx 50 index closed down 1.6%. German, French and Italian stock indexes both fell by more than 1%, while German e-commerce stocks fell sharply, but the Russian trading system cash index RTS rose by 1.6%.
European and American bond yields all fell sharply in double digits. The market expects the Fed to raise interest rates in the next three times.
Safe-hazard demand drives the yields of treasury bonds in major European and American countries in each period to fall sharply, and the 5-year/10-year US bond yield curve ends inverted.
10-year benchmark US Treasury yield fell by 14 basis points on Tuesday and fell by 2.72% at one point, the lowest in the past month since April 27. The 30-year long-term bond yield fell by more than 12 basis points and fell below the 3% mark, with a daily decline of 2.94%. The more monetary policy-sensitive biennial yield fell 16 basis points and fell 2.47% to a new one-month low. The five-year yield fell by 15.5 basis points.
British bond yields lead the decline in the yields of major sovereign bonds in Western Europe.The yields of 10-year German, Italian and Spanish government bonds fell by 5 basis points at the end of Tuesday, the yields of 10-year French bonds fell by 4 basis points, the yields of 10-year British bonds fell by 10 basis points during the session, the yields of two-year British bonds fell by 12 basis points at the end of Tuesday, and the yields of 10-year Greek government bonds fell by more than 11 basis points.
The currency market's expectation of the overall interest rate hike in the Federal Reserve's next three FOMC meetings has basically ruled out the possibility of 50 basis points hikes in each meeting. Bank of America said the U.S. economy is facing the risk of recession or stagflation and recommends selling 10-year TIPS and holding 30-year TIPS.
After the United States announced the release of its strategic reserves, international oil prices turned down and forced US$109. U.S. natural gas hit a three-year high of 14
After the United States announced the sale of 40.1 million barrels of oil from its strategic reserves, U.S. oil prices stopped rising and fell. WTI July crude oil futures closed down $0.52, or 0.47%, at $109.77 per barrel. Brent July futures closed up $0.14, or 0.12%, at $113.56 per barrel.
US oil WTI once rose more than the US dollar or rose 1% at the beginning of the US market, rising above US$111 on the day, and then fell by the deepest during the day by US$1.68 or fell 1.5%, and once lost at US$109. International Brent Oil futures maintained their growth throughout the day and stood firm above US$113. August futures fell from nearly US$112, with the deepest drop in the day of $1.69 or 1.5%, and the daily low was pressing against US$109.
analysis pointed out that the previous rise in international oil prices was due to the continued tightening of global supply and the increase in expectations for the peak demand for oil use in the United States during summer travel that started this weekend, but the increase was impacted by the warning of global recession and the resurgence of the epidemic restricted travel and production activities.
The Russian-Ukrainian conflict also continues to have an impact on the energy market. Although European Commission President von der Leyen said today that the EU summit could not reach a consensus on the ban on Russian oil imports, according to CCTV News, the German economy minister still expects that the EU will reach an agreement on the issue of an embargo on Russia in the short term, and the next EU summit will be held at the end of May.
European and American natural gas rises generally. NYMEX U.S. natural gas futures closed up 0.59% in June to US$8.7960 per million British thermal units, a record high since August 2008. ICE UK gas futures and European benchmark TTF Dutch gas futures both rose by more than 1%.
Hawks ECB boosted the euro, safe-haven demand pushed the yen to a one-month high, and the dollar hit a one-month low for two consecutive days
As senior ECB officials led by Lagarde suggested that the July interest rate hike was a foregone conclusion and that negative interest rates for the past eight years would end at the end of the third quarter, such hawks boosted the euro, a basket of US dollar index measuring the dollar against six major currencies fell another 0.3% on Tuesday, falling another 102 mark, falling for two consecutive days and hitting a new month since April 26, falling for the sixth day of the eight-day decline.
Euro rose above 1.07 against the US dollar, rebounding from a five-year low hit at 1.0349 in early May, and rebounded sharply by 3.6% in the past seven trading days. The market demand for safe-haven has risen, with the dollar falling to 1% against the yen and falling below 127, the lowest in a month since April 18. The risk-sensitive Australian dollar and New Zealand New Zealand dollar both fell more than 0.5%, although New Zealand could raise interest rates by a 50 basis point on Wednesday.
digital cryptocurrencies are mostly falling. Bitcoin, the leader with the largest market value, once lost the integer of US$29,000, and the US stock market rose in the late trading. Ethereum, the second largest market value, narrowed from falling more than 4% to nearly 2%, but fell below the $2,000 mark. The ECB's financial stability report warned cryptocurrencies for the first time, and the chief investment officer of Guggenheim predicted that "bitcoin will plummet 70% to $8,000."
gold futures rose for four consecutive days to a two-week high of over 1865 USD. Demand concerns caused London metal to stop rising three consecutive increases, London copper fell below 9500 USD
As the pressure on gold prices, the US dollar and US Treasury yields fell together, COMEX June gold futures closed up more than 0.9%, rising for four consecutive trading days, reaching $1865.40 per ounce, hitting a new high in the past two weeks. Spot gold rose above the key 200-day moving average, with a maximum increase of US$16 or 0.9% intraday. The daily high was close to US$1,870, rising for five consecutive days and recovering all losses since May 10.
Despite the dollar's decline, demand concerns have been even greater, and the dollar-denominated London base metals fell on Tuesday.LME copper futures stopped rising for three days, fell from a 2.5-week high and fell below the integer of $9,500 per ton. Lun Aluminum and Lun Lead also fell for the first time in four days. London nickel fell for two consecutive days and closed down 4.3% on Tuesday or down nearly $1,190, but London zinc, which led the rise yesterday, rose slightly again, closing above $3,700 for four consecutive days.
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