China Times (www.chinatimes.net.cn) reporter Shuai Kecong Chen Feng Beijing report
In the early morning of October 14, Beijing time, US stocks closed sharply higher on Thursday. The three major indexes staged a major reversal intraday, closing up more than 2%. The Dow Jones Industrial Average suddenly pulled more than 1,500 points intraday. The United States' core CPI hit a 40-year high in September, strengthening the expectation of Fed's aggressive rate hikes , which once shocked the market.
market researchers believe that the rebound of US stocks is more of a technical factor. As US inflation continues to "high fever" and the radical interest rate hike is still on the verge of being on the string, which still puts a huge suppression on the future market of US stocks. Currently, the market expects that the probability of the Federal Reserve raising interest rates by 75 basis points in November is more than 96%.
Dow rose 1500 points intraday
Local time on October 13, local time, The U.S. Bureau of Labor Statistics reported that the U.S. Consumer Price Index (CPI) in September rose 0.4% month-on-month, higher than market expectations of 0.2%. CPI rose 8.2% year-on-year in September, higher than expected 8.1%. After excluding the volatile food and energy prices, the core CPI in September rose by 6.6% year-on-year, not only higher than the market expectations of 6.5% and 6.3% of the previous value, but also hit a new high since August 1982; the core CPI rose by 0.6% month-on-month, the same as the previous value, and 0.4% higher than the market expectations.
data shows that US inflation remains high, strengthening the Fed's expectation of another sharp interest rate hike in November. According to the CME Fed Observation Tool, the market currently expects that the probability of the Federal Reserve raising interest rates by 75 basis points in November is 96.3%, and the probability of the fifth consecutive rate hike in December is 71.5%.
The probability of raising interest rates by 75 basis points in November reached 96.3%
After the data was released, the global market was shocked. The US dollar index rose sharply, and the yield of US bond main maturity rose rapidly. European stocks and US stocks futures collectively plunged, and gold and crude oil denominated in US dollars also fell during the session. However, as market sentiment gradually eases, financial markets have staged a reversal.
"The US dollar index and the stock market may be just a short-term adjustment." In the early morning of October 14, Zheng Lei, chief economist of Samoyed Cloud Technology Group, said in an interview with a reporter from " China Times " that the probability of the Federal Reserve raising interest rates by 75 basis points in November is close to 100%. Unless a market crash occurred before this, there is no reason to think that inflation is reaching a new high, which is a peak signal. The Federal Reserve has repeatedly stated that it will not change its interest rate hike strategy due to the economic recession. The market will return to the rational track as it continues to evaluate policy impacts.
The three major U.S. stock indexes opened low and closed high on Thursday, with the Dow Jones Industrial Average rising more than 800 points to 30,038.72 points, regaining the 30,000 point mark in one fell swoop. S&P 500 index closed up 2.6%, and the Nasdaq closed up 2.83%. Among them, the Dow Jones Industrial Average fell by about 550 points during the session, with the maximum intraday pullback of more than 1,500 points. , Nasdaq , and S&P 500 broke six consecutive declines.
Chinese stocks still closed down
In the trading of US stocks on Thursday, 11 sectors of the S&P 500 index closed higher, the financial sector and energy sector led by more than 4%, the information technology sector also rose by more than 3%, and the optional consumer sector increased by less than 1% to the end. Bank stocks generally rose sharply, with JPMorgan Chase closing up more than 5%, leading the rise in Dow Jones component stock .
Most of the stock prices of US technology giants closed higher, and they also staged a reversal. Apple shares fell more than 2.5% at the beginning of the session, but closed up 3.36%, and its market value rebounded to about $2.3 trillion. Microsoft stock price fell more than 3% at the beginning of the session, but finally closed up 3.76%. Tesla stock price fell by more than 5%, but eventually closed up more than 2%.
It is worth noting that although Chinese stocks listed in the market also staged a major reversal during the session, most of them still closed down. The Nasdaq Golden Dragon China Index closed down 0.68% to 5534.28 points, and fell more than 5% at the beginning of the session.
Tonghuashun iFind data shows that as of the close of October 14, as many as 140 of the more than 260 Chinese stocks listed in the US closed down.Most of the popular Chinese stocks in
closed down, Alibaba stock price closed down 0.95%, JD stock price closed down 2.91%, Pinduoduo stock price closed down 1.02%, NetEase stock price closed down 1%, Baidu stock price closed down 0.3%, Beike stock price fell nearly 7%, NIO stock price closed down 0.78%, Ideal Auto closed down 1.72%, Xiaopeng Motors closed down 4.4%, and Shangmax Technology fell more than 15%.
Radical interest rate hikes are on the string
Although the US stock market has reversed sharply from panic, some market researchers believe that this may be more of a technical rebound than a fundamental.
Due to factors such as Fed rate hike , the US stock market suffered huge setbacks this year, ranking among the top major stock markets in the world. Tonglian data shows that as of the close of October 14, the Dow Jones Industrial Average fell by more than 17% this year, the S&P 500 fell by about 23%, and the Nasdaq fell by nearly 32%.
As US inflation continues to remain high, the Fed's aggressive interest rate hike is still on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the verge of being on the ver Minutes of the Fed's September meeting released on Wednesday showed policymakers believe inflation is still at an unacceptable high and well above its long-term target of 2%. They reiterated that they would insist on continuing to raise interest rates until inflation shows signs of resolution.
The U.S. Bureau of Labor Statistics released a report last Friday that the U.S. unemployment rate in September was 3.5%, the lowest level in 50 years. Professional investor Cheng Yu said in an interview with a reporter from the China Times that the Fed's main statutory responsibilities are actually two, namely, ensuring employment and controlling inflation . The 3.5% employment rate has achieved full employment in economics. Since the employment market has no worries, the Fed will inevitably do its best to cope with inflation.
IPG China's chief economist Bai Wenxi told reporters on the morning of the 14th that a rapid rate hike may lead to a collapse of the financial market and a recession. Although the Federal Reserve is worried about this issue, the Federal Reserve is most concerned about changes in employment indicators. If the employment indicators deteriorate, the Federal Reserve will be more likely to adjust the regulatory policy and the specific strategies. It is expected that the US stock market will rebound after completely digesting the negative impact of this round of interest rate hike, or after key technology and market innovation or consumption hotspots appear.
