On Monday, April 29th local time, all three major US stock indexes closed higher. As of the close, the Dow Jones Industrial Average rose 0.38%, the Nasdaq rose 0.35%, and the S&P 500 index rose 0.32%.
In terms of economic data, the Dallas Federal Reserve Business Activity Index for April in the United States was -14.5, with an expected -11.3 and a previous value of -14.4.
The US Treasury Department stated in a statement on Monday that net borrowing from April to June is expected to be $41 billion more than the $2020 billion forecast released at the end of January. The US Treasury Department stated that this growth is mainly due to a decrease in cash revenue.
Most regions in China (such as government agencies, airports, expressways, etc.) will lift the restrictions on Tesla's vehicles. Tesla's Full auto drive system (FSD) is also expected to enter the Chinese automobile market in the future. Tesla's stock price rose 15.31% local time on Monday and has rebounded nearly 40% since last Monday's low.
Recently, the exchange rate of the Japanese yen against the US dollar has dropped significantly, dropping below 160 at one point, setting a new low in 34 years. Japan's Chief Foreign Exchange Officer, Makoto Kanda, stated that he will respond to the foreign exchange market 24 hours a day.
Apple and Amazon will release financial reports, and the market is waiting for interest rate decisions
On Monday, April 29th local time, all three major US stock indexes closed higher. As of the close, the Dow Jones Industrial Average rose 146.43 points, or 0.38%, to 38386.09 points; The Nasdaq rose 55.18 points, or 0.35%, to 15983.08 points; The S&P 500 index rose 16.21 points, or 0.32%, to 5116.17 points.
The US Treasury Department stated in a statement on Monday that it expects borrowing demand from April to June to increase from $2020 billion to $243 billion, and reiterated that its cash balance will remain at $750 billion by the end of June. Almost at the same time, the three major US stock indexes suddenly plunged, but then rebounded in a V-shaped pattern.
Zakari Griffith, Head of Investment Ratings and Macro Strategy at CreditSights in the United States, said, "The upward correction is somewhat surprising. However, the $41 billion correction by the US Treasury is only a rounding error for the debt and deficit levels we are dealing with. Market reactions indicate that the US fiscal situation remains quite sensitive."
Although people are betting that the Federal Reserve will maintain higher interest rates for a longer period of time, the strong financial reporting season has supported the market. According to data compiled by Bloomberg, early results of the financial reporting season indicate that over 80% of US companies have exceeded expectations. The first quarter profit is expected to increase by 4.7% compared to the same period last year, while the pre quarter forecast is 3.8%. Amazon and Apple, among the seven major technology companies, will also release their financial reports this week.
Chris Laki of Morgan Stanley said, "Last week, investors' enthusiasm for large technology companies exceeded concerns about inflation. This week, we will focus on Amazon and Apple's financial reports, but traders will also pay attention to the latest employment data and the Federal Reserve's views on inflation and interest rate cuts."
The market may continue to fluctuate this week, but UBS Group still believes that the current environment is favorable for the US stock market. Sam Marcelli of UBS Global Wealth Management said, "We still hold a constructive attitude towards the US stock market and expect AI related companies to maintain strong profits in the coming years. It is crucial for investors to strategically allocate technology stocks in a healthy manner, but we advocate for diversified investments across regions and industries."
Morgan Stanley's Marco Kolanovich believes that the US stock market may repeat the late summer slump that began in August last year. He said that the prospect of long-term interest rate hikes will put pressure on economic growth. He said, "We are still concerned that last summer's pullback will repeat."
Mark Hackett from Nationwide said, "With bulls and bears vying for control, the stock market has been fluctuating horizontally for two months. It is difficult to see a dramatic breakthrough in either direction in the short term because both sides have convincing arguments and expectations are not overly optimistic or pessimistic."
The entire market has different opinions on the trend of the stock market, but hedge funds' interest in technology stocks did not weaken last week. According to data compiled by Goldman Sachs Group's prime brokerage business, technology stocks have seen their largest net buying since December 2022, driven by an increase in long positions and short covering.
Tesla rose over 15% in a single day, resulting in a total loss of $5.5 billion for bears
In terms of sectors, the 11 major sectors of the S&P 500 index rose 9 times and fell 2 times, with non essential consumer goods, utilities, real estate, materials, and industrial stocks leading the way. Communication services and financial stocks experienced the largest decline.
Popular technology stocks have fluctuated in price. Tesla rose more than 15%, AMD rose more than 3%, Apple and Qualcomm rose more than 2%, Texas Instruments rose more than 1%, Amazon, Lilly, TSMC, and NVIDIA rose slightly, Cisco, Netflix, Broadcom, and Micron Technology fell slightly, Asma and Microsoft fell 1%, Intel fell more than 1%, Meta fell more than 2%, and Google A fell more than 3%.
Tesla rose 15.31%. On Monday local time, according to foreign media reports, Tesla will cooperate with Baidu to promote the launch of more advanced driving assistance functions in the Chinese automotive market. Through its collaboration with Baidu, Tesla has resolved significant regulatory barriers as foreign companies selling smart cars in China require the use of approved local map and navigation system suppliers. In addition, on April 28th, the China Association of Automobile Manufacturers and the National Computer Network Emergency Technology Coordination Center issued a notice on the detection of four safety requirements for automobile data processing (first batch). The list of vehicle models that meet the four compliance requirements for automobile data security released showed that Tesla's domestically produced Model 3 and Model Y meet the requirements for automobile data security compliance, which means that restrictions on Tesla vehicles will be lifted in most areas of China (such as government agencies, airports, highways, etc.).
According to the latest data from fintech and analytics firm S3 Partners, investors who short Tesla stocks have lost a total of $5.5 billion in the past four trading days since Tesla promised to launch more affordable cars. Tesla's stock price has risen nearly 40% since April 24th, with a slight increase of nearly 18% during intraday local time on Monday. According to S3 Partners, the surge in stock prices on Monday alone resulted in a total loss of $2.93 billion for short selling investors. However, Tesla's stock price still fell by more than 20% in 2024, and investors who short Tesla have earned a profit of $4.1 billion so far this year.
Apple rose 2.48%. On Monday local time, the EU antitrust regulatory agency designated Apple's iPad operating system as the "gatekeeper". This decision is based on the Digital Markets Act (DMA) that came into effect this year. The European Commission stated that Apple's number of commercial users has exceeded the quantitative threshold by eleven times, while its number of end users is close to the threshold and is expected to increase in the near future. The committee pointed out that due to the vast ecosystem of iPadOS, both commercial and end users are locked in it. Apple stated that it will continue to engage constructively with the European Commission to ensure that all designated services comply with DMA.
Meta fell 2.41%. On Monday local time, according to the Financial Times, EU regulatory agencies are expected to investigate Meta due to concerns that Meta may not have taken sufficient measures to review false information. The report quotes two insiders as saying that regulatory agencies suspect that Meta's content review efforts are insufficient to prevent the spread of various types of false information.
Microsoft fell 1.00%. Global news publisher AxelSpringer announced on Monday that as their business expands, they will migrate some cloud based applications to Microsoft's Azure and enhance their artificial intelligence partnership with Microsoft. The two companies stated that AxelSpringer will also collaborate with Microsoft to launch an AI driven chat experience, which will include content from AxelSpringer. According to the extension protocol, content from brands such as Politico, BusinessInsider, Bild, and Welt under AxelSpringer will be provided to Microsoft Start MSN users.
Large bank stocks fluctuate, with BlackRock Middle East taking new actions
Large bank stocks have fluctuated. Goldman Sachs, Morgan Stanley, and UBS Group saw a slight increase, while JPMorgan Chase, Wells Fargo, BlackRock, Citigroup, and Bank of America saw a slight decline.
Morgan Stanley rose 0.14%. On Monday local time, according to the suggestion of influential acting advisor Glass Lewis, Morgan Stanley shareholders should vote against the bank's executive compensation proposal at the annual meeting on May 23rd. The report states that former CEO and current executive chairman James Goleman was awarded $37 million by the board of directors, while his successor Ted Pique and two other CEO candidates each received a one-time bonus of $20 million. Glass Lewis cited his compensation model in his report, stating that Morgan Stanley's compensation payments are far higher than those of its peers, and there is a serious mismatch between compensation and performance.
BlackRock fell 0.21%. On Monday local time, according to Bloomberg, BlackRock is preparing to hold a gathering of corporate executives and government officials in Riyadh, marking the first time the US company has held such a large-scale event in the Saudi Arabian capital and supporting the country's efforts to attract foreign investment. According to reports citing insiders, BlackRock will host the event together with the Saudi Ministry of Finance, aiming to showcase investment opportunities to the outside world and outline the progress of Saudi Arabia's trillion dollar "2030 Vision" plan.
This event coincides with Saudi Arabia increasing its efforts to raise billions of dollars for Crown Prince Mohammad bin Salman's ambitious economic transformation plan. Analysts believe that BlackRock's involvement indicates that this US company has a very deep foothold in Saudi Arabia, the largest market in the region.
Energy stocks mostly rose. Petrobras and ExxonMobil rose by over 1%, while Murphy, Western Oil, and Chevron saw a slight increase. US Energy and BP stocks remained unchanged, while ConocoPhillips and Shell saw a slight decline.
ExxonMobil rose 1.42%. Some employees of ExxonMobil are facing layoffs due to their unwillingness to relocate from Brussels to London, and it is expected that 37 employees will be laid off. According to a joint statement from the ExxonMobil Union on Monday, most employees at the Brussels base stated in an internal investigation organized by the union that they will not relocate to the UK capital due to uncompetitive salaries and lack of flexibility.
ExxonMobil spokesperson stated via email that London has better proximity to trading activities and talent pools, but has not responded to union allegations of layoffs, only stating that the company is willing to resolve this situation. Earlier this year, ExxonMobil requested its Belgian employees to migrate to the UK in order to merge dispersed teams and establish a new global trading department.
Most popular Chinese concept stocks rose. The Nasdaq China Golden Dragon Index rose 0.54%. Ideal Automobile rose more than 7%, Baidu rose more than 5%, Xiaopeng Automobile rose more than 3%, NIO rose more than 2%, Bilibili, iQiyi, and Alibaba rose more than 1%, Weibo, NetEase, Manbang, and Tencent Music rose slightly, while JD.com, Futu Holdings, and Pinduoduo fell more than 1%.
Japan responds to the foreign exchange market 24/7
On Monday, the US dollar slightly rose against the Japanese yen and began to turn downward after approaching 160, before continuously falling below the five integer levels of 159, 158, 157, 156, and 155.
Subsequently, there were rumors in the market that the Japanese government had begun to intervene in the yen's trend. But Japan's top currency official chose not to let market participants know whether the Japanese government had intervened in the foreign exchange market. Japanese Deputy Minister of Finance, Makoto Kanda, stated that there is currently no comment.
Japan's Chief Foreign Exchange Officer, Makoto Kanda, subsequently stated that he will respond to the foreign exchange market 24 hours a day and take appropriate actions as needed. The intervention situation will be disclosed at the end of next month. He also stated that the depreciation of the yen has both advantages and disadvantages. Speculatively driven excessive exchange rate fluctuations are detrimental to the economy, and appropriate actions will be taken to address such fluctuations; At present, the impact of exchange rates on import prices is significant.