ADDX Go Market Morning Wrap - 13th Dec

 

Market Key Focus

US Market

- Markets

Inflation has increased the uncertainty of the interest rate cut prospects, dragging down U.S. stocks. The Nasdaq fell below 20,000 points, with small-cap stock indexes falling nearly 1.4% to lead the decline. The Dow Jones Industrial Average fell for six consecutive days.

 

The probability of a rate cut next week remains extremely high (95%)

 

- Stocks

Most technology stocks fell, with the chip index falling as much as 1.6%. Nvidia fell nearly 2.5% at one point, Broadcom fell as low as 4% but rose 15% after the market, and Adobe, whose performance guidance was lower than expected, closed down 13.69%.

Except for consumer staples and real estate, all sectors fell, while the China Concept Index rose against the market trend, and Apple hit a new high.

 

- Treasury

The U.S. Treasury auctioned $22 billion in 30-year Treasury bonds, but demand was weak and long-term U.S. Treasury yields rose by at least 7bp. After the PPI data was released during the session, the two-year U.S. Treasury yield first fell to a daily low, and then rose by more than 5bp to turn positive.

 

U.S. Treasury yields rose

 

- FX

The inflation data helped push the dollar index higher for the fifth consecutive day. The dollar index DXY rose 0.31% to 107.038 points

 

The dollar rose for five consecutive days

 

Asian Market

- Markets

The MSCI Asia Index posted its biggest gain in more than a week. Japan's Topix rebounded to its highest level since July.

The Nikkei 225 closed up 1.2% at 39,849.14. Japan's Topix closed up 0.9% at 2,773.03.

South Korea's Kospi closed up 1.6% at 2,482.12

 

- Stocks

The Nasdaq Golden Dragon China Index closed up 0.18%. Among ETFs, the FTSE A50 Index Futures closed down 0.89% overnight at 13,546.000 points.

 

- FX

The market cut bets on Japan's interest rate hike next week, and the yen fell to 153.

The offshore renminbi rose by more than 200 points and once exceeded 7.26 yuan

 

European Market

- Markets

European stocks closed slightly lower after the European Central Bank cut interest rates for the fourth time this year.

Germany's DAX 30 index closed up 0.13%. France's CAC 40 index closed down 0.03%. Britain's FTSE 100 index closed up 0.12%.

 

- Stocks

Mining stocks fell 1.7% while auto stocks rose 0.87%.

Goldman Sachs analysts predict that European banks may be in a difficult situation in 2025. The challenges they face include low interest rates, slowing economic growth in the eurozone, and political uncertainty.

 

- Treasury

The yields of Italian, Greek and Spanish sovereign bonds in the euro zone rose by about 16bp at most, and the yields of 2/10-year German bonds rose by about 8bp at most

 

- FX

After the ECB cut interest rates, the euro fell first and then rose. The Swiss franc fell by more than 0.9%

 

Cryptocurrency Market

1. When Trump rang the opening bell at the New York Stock Exchange, he said that some major actions would be taken on cryptocurrencies. The U.S. state of Texas announced a draft legislation requiring the establishment of a strategic Bitcoin reserve, which once pushed Bitcoin to a daily high, but then returned to below $100,000

 

After surging above $102,000, Bitcoin fell back below $100,000

 

Macro

1. The number of first-time unemployment claims last week unexpectedly rose to 242,000, higher than expected and the previous value, the highest in two months. The slowdown in the US job market has strengthened the Fed's expectations of a 25bp rate cut next week, curbing the rise in some US bond yields. However, US inflation unexpectedly accelerated. The PPI in November increased by 3% year-on-year, exceeding expectations, and the month-on-month increase of 0.4% was the largest increase since June. The core PPI in November increased by 3.4% year-on-year, also higher than expected and the previous value. The core inflation rate in the United States remained strong for the fourth consecutive month. In addition, Trump threatened to increase import tariffs after taking office. There is uncertainty about the Fed's interest rate cut prospects next year, and the US dollar and US bond yields rose across the board
2. In the eurozone, the European Central Bank cut interest rates by 25bp as expected, abandoned the argument of maintaining a "restrictive" interest rate, and lowered its GDP and CPI growth forecasts for this year and next. Lagarde said that geopolitical tensions could push up inflation, and traders cut their bets on the ECB to cut interest rates, predicting a rate cut of less than 125bp by 2025. European bond yields generally rose, and the euro recovered its earlier losses. European stocks rose slightly before retreating

 

Stocks to Focus

1. Trump Media Technology (DJT) rose more than 3.6% before falling. Trump rang the opening bell for the New York Stock Exchange and declared that the stock market is everything and that major actions will be taken against cryptocurrencies
2. Media giant Warner Bros. Discovery rose more than 15% and announced a restructuring plan to split its business into linear and streaming departments
3. Reports said that activist investor Starboard Value has invested in Bitcoin miner Riot Platforms and is pushing the company to transform some of its Bitcoin mining facilities into space for large data center users, causing the latter to rise by nearly 13% at one point
4. As one of the key technology IPOs this year, cloud software provider ServiceTitan rose more than 40% on its first day of listing