Unexpectedly, the US stock market plummeted 1,000 points before going to bed last night but was not the end.
On Thursday, US stocks plummeted, among which the Dow Jones Industrial Average closed down more than 1,860 points or 6.9%, the largest single-day decline since March 16. On March 16, the Dow Jones Industrial Average fell 12 points.
, commonly known as the "panic index", end of VIX, soared 50.92%, rising to 41.61, with a high of 42.58, the highest level since April 21.
We know that after experiencing continuous plunges in the early stage, the US stock market rebounded sharply, among which the Nasdaq hit a record high and broke through 10,000 points, and the S&P 500 also regained its lost ground for several months.
However, the intensification of the epidemic has led to continued rising concerns about the second wave of the epidemic. The Federal Reserve decided to remain silent on Wednesday to keep interest rates close to zero. In addition, the relevant statements of the Federal Reserve have exacerbated the panic. In this case, Trump could not sit still. He said that the Federal Reserve "frequently makes mistakes"; in addition, he also said that he saw that the non-farm numbers performed well, and we will have a very good third quarter, a great fourth quarter, and 2021 will be one of the best year we have ever seen. Vaccines and treatments are coming soon, so wait and see!
As of 3:38 pm Eastern Time on the 11th, the number of confirmed cases of new coronary pneumonia in the United States reached 2013,940 and 113,467 deaths.
Although the epidemic rebounded, US Treasury Secretary Mnuchin said in an interview with CNBC: "We have realized that if the economy is closed, it will cause greater losses." "We cannot close the economy again." Mnuchin believes that Trump is right to urge states to relax restrictions. He believes that if the epidemic makes a comeback, there is no need to take restrictive measures again. In addition, he also said that $1 trillion will be injected into the US economy next month.
plummeted! The Dow Jones Industrial Average fell to a new high in the past three months.
Let’s first look at the situation of the three major U.S. indexes.
As of the close, the Dow Jones Industrial Average fell 6.9% to 25,128.17 points, the S&P 500 fell 5.89% to 3,002.1 points, and the Nasdaq fell 5.27% to 9,492.73 points.
stocks, large US technology stocks fell across the board, with Apple falling 4.8%, Amazon falling 3.38%, Netflix falling 2.05%, Google falling 4.29%, Facebook falling 5.24%, and Microsoft falling 5.37%.
In addition, the airline stocks that had rebounded the most fiercely before also fell sharply last night, with the most typical American Airlines falling 15%, while Boeing even fell 16%, leading the Dow Jones.
Most of the popular Chinese stocks closed down, Alibaba fell 3.77%, JD.com fell 5.7%, Baidu fell 4.26%; Jiayin Jinke fell 32.76%, Magic Line fell 27.61%, Fangduoduo fell 20.04%, Luckin Coffee fell 14.72%, NIO fell 6.19%; Huafu Education rose 217.78%, Wensheng Finance rose 146.18%, and Anbo Education rose 30%.
In addition, international oil prices fell across the board on Thursday, with NYMEX crude oil futures closing down 8.66% at $36.17 per barrel, a two-week low and the largest decline in six weeks; Bergasoline fell 7.98% at $38.4 per barrel.
Due to the sharp decline in crude oil prices, US stocks and Chinese energy stocks generally fell. ExxonMobil fell 8.85%, Chevron fell 8.4%, ConocoPhillips fell 8.17%, Schlumberger fell 11.64%, and EOG Energy fell 8.05%.
As risk aversion sentiment heated up, COMEX gold futures closed up 0.76% at $1,733.7 per ounce, rising for four consecutive days, hitting a two-week high.
has it risen too much? Why is the sudden plunge?
The global market has seen a sharp drop, and more so are worries about the epidemic and the sharp rebound in the early stage triggering selling pressure. However, the latest economic data released by the United States may also illustrate some problems.
In terms of economic data, the number of people who requested unemployment benefits in the United States in the week of June 6 was 1.542 million, with an expected number of 1.55 million, with an expected number of people who received 1.877 million; the average of the four-week period was 2.002 million, with an expected number of people who received 2.284 million; the number of people who received unemployment benefits in the week of May 30 was 20.929 million, with an expected number of people who received 20 million, with an expected number of people who received 21.487 million.
US PPI fell 0.8% year-on-year, expected to fall 1.2%, and the previous value fell 1.2%; month-on-month, expected to rise 0.1%, and the previous value fell 1.3%; core PPI rose 0.3% year-on-year, expected to rise 0.4%, and the previous value rose 0.6%; month-on-month, expected to fall 0.1%, and the previous value fell 0.3%.
can be seen that the above data is not bad, but the data does not have a sharp positive trend. Federal Reserve Chairman Powell said on Wednesday that the coronavirus epidemic may cause long-term damage to the economy. The first-time unemployment benefit data released on Thursday supported this view, and market risk appetite decreased accordingly.
In addition, the Federal Reserve report showed that US household net assets decreased by $6.55 trillion in the first quarter, the largest drop in history; the annualized growth rate of US corporate debt in the first quarter reached a record 18.8%.
The epidemic rebounded, with the global daily confirmed cases increasing by nearly 130,000
As of now, the number of confirmed cases in the United States has exceeded 2 million, and yesterday, the number of new cases in the world increased by nearly 130,000 in a single day, which shows that the epidemic has not been controlled.
In addition, let’s take a look at the latest situation of the epidemic. As protests and demonstrations intensify, the number of new coronavirus pneumonia in the United States has also rebounded.
As of 3:38 pm Eastern Time on the 11th, the number of confirmed cases of new coronary pneumonia in the United States reached 2013,940 and 113,467 deaths.
Texas data is the worst. According to reports, the number of confirmed cases of COVID-19 in Texas in the United States increased by 2.3%, exceeding the 7-day average of 2.2%.
Recently, an official from the state's health department said that "the situation remains serious." A Texas Department of Health Services spokesperson said in an email on June 11 local time, "Of course we still see the spread of the new coronavirus in Texas." He added, “People still need to take action to protect themselves and their communities, continue to maintain social distancing, wear masks in public, and continue to wash their hands regularly and disinfect surfaces”.
According to media reports, there are currently 21 states in the United States with a surge in new confirmed cases, at least 9 states. Arizona's death toll rose by 30%. The number of confirmed cases in Texas increased by 70%. Jiaha, director of the Harvard Institute for Global Health, predicts that 800 to 1,000 new deaths will occur every day in the future, and another 100,000 people are expected to die from now to September.
Worldwide, on June 11, the WHO released the latest daily epidemic report on the new coronavirus pneumonia, with 128,419 new confirmed cases of new coronavirus pneumonia worldwide and 5,347 new deaths. The number of confirmed cases in the Americas, with the most severe epidemic, reached 3485,245 (70,071 new cases), and 189,544 deaths (3,681 new cases).
Let’s take a look at the situation in serious countries, among which the cumulative number of confirmed cases of new coronary pneumonia in Brazil has reached 802,828 and the cumulative number of deaths has reached 40,919. Peru has more than 210,000 confirmed cases of COVID-19, including nearly 10,000 police officers.
How will the market go in the future?
Yesterday, the Asia-Pacific stock markets such as A-shares all experienced different degrees of decline, but A-shares are still the most resistant index.
Zhejiang Business Strategy latest statement stated that compared with the April FOMC meeting, Powell clearly stated that during the Fed's interest rate meeting, the Fed will increase its holdings of US Treasury bonds and institutional housing and mortgage-backed securities (MBS) at at least the current rate. In addition, Powell did not emphasize the impressive non-agricultural data in May at the press conference, but emphasized the serious impact of the epidemic on economic activities, employment and inflation and the high uncertainty facing the US economy. It can be foreseen that the policy intensity will not be reduced and monetary policy will still maintain a loose tone.
Zhejiang Business Strategy believes that foreign capital has net inflows into A-shares for 13 consecutive trading days and the hot issuance of domestic equity funds (similar to 2015) reflects this feature to a certain extent. As mentioned in our research report, the current monetary environment and fiscal policy are still in the honeymoon period, and the long window is still there. With loose liquidity, global asset allocation shortage is still the main tone at present. Under the policy tone of "housing for living, not for speculation", A-share equity assets have become a "reservoir". Industry allocation is recommended to grasp three main investment lines: 1) The "consumer electronics and e-commerce" market driven by the 618 Shopping Festival; 2) New energy vehicles with increased subsidies from Europe; 3) Consumptions with high domestic demand certainty premiums such as "food, beverage, medicine", etc.
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