US stocks closed mixed on Monday, with the Dow Jones reaching a new all-time high. Market sentiment was buoyed by the perception that a recent assassination attempt on Trump might increase his chances of winning the presidential election. Investors are gearing up for this week’s corporate earnings reports.
Federal Reserve Chairman Jerome Powell, speaking at the Economic Club of Washington, D.C. on Monday, indicated that the Fed might not wait for inflation to drop to 2% before cutting interest rates.
Powell mentioned that the second-quarter economic data has given policymakers more confidence in the sustainable progress toward the 2% inflation target. His comments could pave the way for a rate cut in the near future. However, he also emphasized that he would not provide specific timing for the rate cuts.
US Stocks
Fundamental Analysis:
Large-cap tech stocks mostly rose, with Tesla, Apple, and Netflix all gaining over 1%, and Microsoft and Google seeing slight increases. Meanwhile, Nvidia, Amazon, and Meta saw modest declines.
Apple set a new closing high with a market cap of $3.59 trillion. Trump Media & Technology Group surged over 31%, and Rumble climbed more than 20%.
Department stores and precious metals stocks were among the biggest losers, with Macy’s falling over 11%, Dillard’s down over 9%, and Kohl’s dropping more than 3%. Pan American Silver and Newmont Goldcorp each lost over 2%.
Popular Chinese stocks mostly fell, with the Nasdaq Golden Dragon China Index dropping 3.64%. Baidu slid nearly 6%, iQIYI, JD.com, and Bilibili each fell over 5%, XPeng Motors and Weibo fell more than 4%, while NIO and Pinduoduo dropped over 3%.
Alibaba and Vipshop fell over 2%, and Tencent Music, Full Truck Alliance, and Futu Holdings declined more than 1%. NetEase was one of the few gainers.
Technical Analysis:
(S&P 500 Index, 1-day chart)
Market Trends:
- Dow Jones: Up 210.82 points, or 0.53%, to 40,211.72.
- Nasdaq: Up 74.12 points, or 0.40%, to 18,472.57.
- S&P 500: Up 15.87 points, or 0.28%, to 5,631.22.
Hong Kong Stock Market
Fundamental Analysis:
Hong Kong stocks opened lower and continued to decline throughout the day. Tech stocks were generally down, with Baidu and Kuaishou both falling nearly 4%, JD.com and Tencent dropping more than 2%, and Alibaba, Meituan, and Xiaomi each declining over 1%.
Insurance stocks were weak, with Ping An Insurance dropping more than 5%, and consumer electronics stocks were among the worst performers, with TCL Electronics falling nearly 12%.
Ping An Insurance fell over 5% after announcing plans to issue $3.5 billion in 0.875% convertible bonds due 2029, with an initial conversion price of HK$43.71 per H share, a 21.25% premium to the closing price of HK$36.05 on the 15th.
Technical Analysis:
(Hang Seng Index, 1-day chart)
Market Trends:
- Hang Seng Index: Down 1.37%, to 17,769.96.
- Hang Seng Tech Index: Down 1.73%, to 3,609.17.
- Hang Seng China Enterprises Index: Down 1.34%, to 6,335.88.
FTSE China A50 Index
Fundamental Analysis:
Mainland Chinese stocks experienced narrow fluctuations, with financial heavyweights like brokerages and banks providing support.
Precious metals, battery, and consumer electronics sectors led the gains, with Haitong Securities rising nearly 3% and major banks hitting new highs. Huayu Mining hit the daily limit, while Jinlong Motors and Ankai Bus both surged to the limit, and Cambrian rose 10%, reaching a new annual high.
Major funds favored sectors like consumer electronics, batteries, and commercial vehicles, while exiting sectors like semiconductors, insurance, and industrial metals.
Changan Automobile saw a net inflow of main funds of 545 million yuan, the highest among stocks, followed by Sunwoda Electronic, Tsinghua Unigroup, and Jinlong Motors.
Technical Analysis:
(SSE Composite Index, 1-day chart)
Market Trends:
- Shanghai Composite Index: Down 0.21%, to 2,967.85.
- Shenzhen Component Index: Up 0.21%, to 8,819.99.
- ChiNext Index: Up 0.39%, to 1,679.53.
- STAR Market 50 Index: Up 0.94%, to 722.59.
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