ADDX Go Market Morning Wrap - 17th Dec

 

Market Key Focus

US Market

- Markets

On the eve of the Federal Reserve's interest rate meeting, most U.S. stock indices rose, with the Nasdaq setting a new high. Only the Dow Jones Industrial Average fell for eight consecutive days.

 

- Stocks

Technology stocks, chip stocks, and AI concept stocks mostly rose, with Apple, Google, Tesla, and Broadcom all hitting record highs. Broadcom surged more than 11% to lead the Nasdaq, and its market value joined the trillion-dollar "club". The technology and discretionary consumer goods sectors in the S&P 500 also hit record closing highs, while Nvidia entered a correction range, falling more than 10% from its record high.

 

Nvidia enters correction range

 

- Treasury

As investors await the Federal Reserve's policy meeting, U.S. Treasury yields generally fell slightly. The yield on the benchmark 10-year Treasury bond fell 0.39bp to 4.3928%, while the yield on the two-year Treasury bond fell 0.22bp.

 

- FX

As the market awaits the Fed's decision, the U.S. dollar index fell more than 0.1%, hovering near a two-week high.

 

Dollar ends slightly lower, snapping six-day winning streak

 

Asian Market

- Markets

Most Chinese stocks fell. The Nasdaq Golden Dragon China Index closed down 2.19%

 

- FX

The yen fell below 154 as investors awaited the Bank of Japan's policy decision on Thursday.

The offshore renminbi (CNH) fell 112 points against the U.S. dollar in late trading to 7.2923 yuan

 

European Market

- Markets

Poor economic data from the Eurozone depressed European stocks, with Germany's DAX 30 index closing down 0.45%. France's CAC 40 index closed down 0.71%. Britain's FTSE 100 index closed down 0.46%.

 

- Stocks

Auto stocks fell 3%, leading the decline.

Credit rating agency Moody's downgraded France's credit rating from Aa2 to Aa3, and French stocks closed down 0.71%.

On the first day of listing, broadcasting and film production company Canal+ fell 22%, and publisher Louis Hachette rose 23%.

The Danish stock index rebounded more than 1.9%, and component stock Novo Nordisk closed up more than 3%.

 

- Treasury

The 10-year German bond yield ended its five-day winning streak, and the two-year British bond yield rose by about 5bp

 

- FX

The euro rose 0.09% against the dollar to 1.0510, and the pound rose 0.50% against the dollar to 1.2682

 

Cryptocurrency Market

1. Bitcoin rose 4.11% in late trading to $107,000, while Ethereum rose 3.68% in late trading to $4,068.00.

 

Bitcoin hits record high of $108,000, and its exchange rate against the dollar, euro and gold soars to new highs

1. ARK Fund, managed by Cathie Wood, predicts that the price of Bitcoin will be between $124,000 and $150,000 by the end of the year. The most optimistic believe that Bitcoin will exceed $800,000 next year.
2. Bitcoin futures hit a record high, and cryptocurrency stocks generally rose. Riot Platforms closed up 8.01%, Bitdeer Technologies closed up 10.61%, Canaan Technology closed up 8.04%, and the cryptocurrency exchange Coinbase closed up 1.52%, while MSTR closed down 0.04%, purchasing $1.5 billion worth of Bitcoin at an average price of about $100,386 from December 9 to 15. This is the sixth consecutive Monday that the company announced the purchase of Bitcoin.

 

 

Macro

1. The New York Fed manufacturing index in December hit its biggest drop since May 2023. The U.S. service PMI expanded at the fastest pace in more than three years, while manufacturing remained sluggish and the price index soared. Investors are waiting for the Fed's interest rate meeting. Nick Timiraos of the New Fed News Agency said that after another 25bp rate cut this week, the Fed is ready to slow down or even stop rate cuts. Goldman Sachs said that the Fed will "skip" rate cuts in January and may send a signal of slowing easing this week

 

ISM services PMI surges to 38-month high

1. Eurozone PMI continued to shrink in December. Germany's manufacturing recession continued, and inflationary pressure further intensified. France's manufacturing output fell by a 55-month low, and the UK's employment fell by a four-year high. German Chancellor Scholz failed to pass the parliamentary vote of confidence, and he will recommend that the president dissolve the House of Representatives. European Central Bank President Lagarde said that the European Central Bank will further cut interest rates and the battle against inflation is close to victory.

 

Stocks to Focus

1. Tesla closed up 6.14% and hit a new record high. According to reports, the Trump transition team plans to revoke the electric vehicle policy during the Biden era. Wedbush analyst Dan Ives said that if everything goes as expected, Tesla's 2025 stock price target will be revised up 29% to $515 (previously expected to be $400). Tesla's Texas lithium refinery officially started production, becoming the first North American automaker to process lithium on its own. After reaching mass production, the plant is expected to produce about 50GWh of battery-grade lithium per year.
2. Google A rose 3.6%. The company significantly updated its generative AI and launched the video model VEO 2 and the latest version of Imagen3.