ADDX Go Market Morning Wrap - 2024 16th Oct

 

Market Key Focus

US Market

Markets

Only small-cap stocks rose in the U.S. stock market, while the S&P and Dow Jones fell from their new highs. ASML's financial report was a thunderbolt, dragging down the chip index by more than 5%, and also dragging down the U.S. stock market. The New York Fed Manufacturing Index unexpectedly fell into contraction in October and hit a five-month low.

ASML's U.S. stocks plunged 16%, the biggest drop since March 2020 and Nvidia fell from its closing high set yesterday, falling 6.8% at one point. AMD fell more than 5%. Apple released a new AI-supported iPad Mini, which rose 2.7% at one point, hitting an intraday high. U.S. bank stock earnings report, Goldman Sachs rose more than 3% to a new intraday high before closing down, Citigroup opened higher and then fell, falling more than 5%. After the financial report of luxury giant LVMH, its U.S. stocks fell 10% at one point, to a two-year low.

Treasury

The yield on the benchmark 10-year U.S. Treasury note fell 6.86 basis points to 4.0317%, while the yield on the two-year Treasury note fell 1 basis point to 3.9454%.

NY Empire State Manufacturing Index (Oct)

-11.9, a 5-month low and a sharp drop beyond expectations!

 

China Market

Markets

Stocks and currencies both fell, with the Shanghai Composite Index closing down more than 2%, the Hong Kong Hang Seng Tech Index down nearly 5%, and the China Concept Index down nearly 6%. JD and Ctrip fell about 9%, and PDD fell nearly 6%.

Policy stimulus

The Ministry of Housing and Urban-Rural Development, the Ministry of Finance, the People's Bank of China and other departments will hold a press conference at 10 a.m. on October 17 to discuss promoting the stable and healthy development of the real estate market.

FX

Offshore RMB fell 400 points to 7.13 yuan

 

European Market

Stocks

The STOXX 600 index closed down 0.80%. Germany's DAX 30 index closed down 0.11%. France's CAC 40 index closed down 1.05%. Britain's FTSE 100 index closed down 0.52%.

 

Macro

1. "Reflation" has become the new core narrative. Goldman Sachs: Global asset allocation needs to be adjusted, and it is biased towards growth pricing. Goldman Sachs believes that in the "reflation" environment, the market may prefer assets that can benefit from economic recovery and rising inflation. Goldman Sachs is optimistic about the returns of risky assets in the coming year and believes that investors should increase their investment in stocks and credit in the short term.
2. Trump's "chief economic adviser" Bessant said that Trump will not adopt policies to weaken the dollar or cut trade. He emphasized that Trump supports the dollar to maintain its status as the world's reserve currency and regards tariffs as a negotiating strategy.
3. The cooling of the situation in the Middle East and the IEA's warning of oversupply caused oil prices to plummet by 5%, and long-term US bonds to rise. There was news that Israel would not attack Iran's oil facilities. In addition, the International Energy Agency (IEA) warned of oversupply in its latest monthly report. Oil prices once fell by more than 5% during the session. The sharp drop in oil prices weakened market expectations of a resurgence in inflation, pushing US bonds up on the day, with the 10-year US bond yield falling by nearly 7 basis points.

 

Earnings For Today

Before Open

Morgan Stanley

EPS forecast 1.59

Revenue forecast 14.32B

 

Abbott Labs

EPS forecast 1.2

Revenue forecast 10.56B

 

Discover

EPS forecast 3.45

Revenue forecast 4.35B

 

After Close

Lam Research

EPS forecast 8.05

Revenue forecast 4.05B

 

Market Event

 

 

Stocks to Focus

1. ASML's performance was disappointing, with orders only half of market expectations. It lowered its sales target for next year and its stock price plummeted 17%. The company said that demand for AI chips has indeed surged, but other parts of the semiconductor market are weaker than expected, causing logic chip manufacturers to postpone orders.
2. The United States is reported to be considering restricting Nvidia, AMD and other companies from exporting AI chips to Middle Eastern countries
3. luxury giant LVMH fell short of expectations, with quarterly revenue falling for the first time since the Covid. The company said that the poor performance in the third quarter was mainly due to the slowdown in growth in Japan caused by the strengthening of the yen.
4. Apollo CEO: The good fortune of the global asset management industry in the past 15 years has ended, and we must seize these four huge opportunities in the future. Marc Rowan said that in the past 15 years, Apollo's assets under management have grown 16 to 17 times, actually exceeding Apple and Microsoft, but the good fortune of the past 15 years has ended, and we must seize four huge opportunities in the future - global industrial renaissance, huge capital needs of large global companies, large demand for fixed income in the retirement market, and rethinking the public and private equity markets.