The US stock market, gold, and silver saw a big dive.
On Thursday local time, both the Nasdaq and S&P 500 index hit historic highs during trading, and then both fell. As of the close, the Dow Jones Industrial Average fell 1.53%, the Nasdaq fell 0.39%, and the S&P 500 index fell 0.74%. Nvidia broke through $1000 to reach a historic high, but failed to change the overall decline in the US stock market.
Chinese concept stocks collectively fell, with the Nasdaq China Golden Dragon Index falling 3.71%. Bilibili fell over 12%, Beike fell nearly 10%, NIO fell over 8%, Xiaopeng Motors and Century Internet fell over 7%, New Oxygen fell nearly 7%, 36Kr and Xiaoniu Electric fell over 6%, Ideal Automobile, Zhihu, and Tuniu fell over 5%, Ctrip, JD.com, TAL, Monster Charging, and Bitmining fell over 4%.
The golden period has also significantly declined. According to Wind market data, as of the close, London gold is currently trading at $2328.827 per ounce, down 2.09%; COMEX Gold closed at $2330.6 per ounce, down 2.6%. Silver futures are also showing the same trend, with London silver falling 2.13%, COMEX silver fell 3.72%.
The US stock market collectively closed lower, with the Dow Jones down over 600 points
On Thursday local time, the US Nasdaq and S&P 500 opened high, both hitting historic highs during trading, but both subsequently fell. As of the close, the Dow Jones Industrial Average fell 605.78 points, or 1.53%, to 39065.26 points, marking its worst daily performance since March 2023; The Nasdaq fell 65.51 points, or 0.39%, to 16736.03 points; The S&P 500 index fell 39.17 points, or 0.74%, to 5267.84 points. Nvidia broke through $1000 to reach a historic high, but failed to change the overall decline in the US stock market. The market is concerned that the Federal Reserve may not cut interest rates soon.
Last week, the number of first-time applicants for unemployment benefits in the United States decreased, but the number of applicants remained low due to easing job demand and layoffs. The latest data released by the US Department of Labor shows that in the week ending May 18th, the number of first-time applicants for unemployment benefits decreased by 8000 to 215000, the largest decline since September last year. Similar declines were seen in the previous week, with a median forecast of 220000. As of the week ending May 11th, the number of people reapplying for unemployment benefits was 1.79 million, with little change.
The initial value of S&P's global manufacturing PMI in May reached 50.9, a new high in two months; The initial value of S&P's global service sector PMI in May reached 54.8, a new high in 12 months; The initial value of the S&P Global Composite PMI for May in the United States was 54.4, a new high in 25 months.
The initial value of S&P's global manufacturing PMI for May in the United States increased from 50.0 in April to 50.9, indicating an overall improvement in the commercial conditions of the commodity production sector. Although lower than the data from February and March, the latest PMI is the third highest level in the past 20 months. Compared to April, the contribution of output and employment to PMI has become increasingly positive, while the drag of new orders and procurement inventory on PMI has weakened. The average delivery time of the supplier has slightly accelerated this month, indicating that the supplier is not so busy, so the impact on PMI is also relatively small.
JPMorgan Chase CEO Jamie Damon said there may be a "hard landing" in the US economy. Damon said that the worst outcome for the US economy will be "stagflation," where inflation continues to rise but economic growth slows down amidst high unemployment rates. Damon said that interest rates may still rise "slightly".
Chris Williamson, chief business economist of S&P Global Market Intelligence, said that the main inflation driver now comes from the manufacturing industry rather than the service industry, which means that the inflation rate of costs and sales prices is now higher than the standard of the COVID-19 epidemic, and the goal of 2% of the Federal Reserve still seems to be difficult to achieve.
Atlanta Fed Chairman Bostic said the Fed may need to wait longer to lower interest rates. Traders have postponed the estimated first rate cut by the Federal Reserve from November to December.
NVIDIA's net profit surged by nearly 630%, and its stock price exceeded $1000
In terms of sectors, the 11 major sectors of the S&P 500 index saw ten declines and one rise, with the real estate and public utilities sectors leading the decline with a decline of 2.16% and 1.7% respectively, while information technology rose by 0.56%.
Most popular technology stocks fell, with Intel falling more than 4%, Tesla and Chaowei Semiconductor falling more than 3%, AMD, Texas Instruments, and Apple falling more than 2%, Cisco, Google, and Ericsson falling more than 1%, Microsoft, Netflix, Qualcomm Meta slightly declined; Nvidia rose more than 9%, Asma rose more than 1%, and TSMC and SAP saw a slight increase.
Nvidia, the king of AI, surged 9.32%. Stimulated by the unexpected financial report, Nvidia's stock price broke through $1000 at the beginning of trading. As of closing, the stock price was at $1037.99 per share, with a market value of $2.55 trillion.
After the market on May 22, NVIDIA released its first quarter results for the fiscal year 2025 as of April 28, achieving a revenue of $26 billion, a year-on-year increase of 262% and a month on month increase of 18%, setting a new historical high for quarterly revenue; The net profit was 14.881 billion US dollars, a month on month increase of 21% and a year-on-year increase of 628%. Data center revenue increased by 427% year-on-year to $22.6 billion, with a market expectation of $22.1 billion, reaching a historic high. The company expects a second quarter revenue of $28 billion (up or down 2%), higher than analysts' expectations of $26.8 billion. In addition, Nvidia announced a "1 split 10" stock split, which will take effect on June 7th; The quarterly cash dividend increased from 4 cents per share to 10 cents.
After the financial report was released, several investment banks raised Nvidia's target price. Goldman Sachs has raised Nvidia's target price from $1100 to $1200, Piper Sandler raised Nvidia's target price from $1050 to $1200, and Citigroup raised Nvidia's target price from $1030 to $1260.
Meanwhile, Huang Renxun, founder and CEO of NVIDIA, announced during the NVIDIA earnings conference call that "the next generation of industrial revolution has begun.". He revealed that, Blackwell's ultra strong AI chip products are currently in full production and will be shipped in the second quarter of this year, increased production in the third quarter, and deployed to data centers in the fourth quarter. After Blackwell's powerful AI chip, another chip will be launched.
Nvidia CEO Huang Renxun stated that the new AI model supporting video generation will further stimulate the demand for Nvidia AI chips. Training and running advanced AI systems requires more computing power, which has boosted the market demand for Nvidia's Grace Hopper chips, such as the H200. This chip was originally used for OpenAI's GPT-4o, a multimodal AI model that can engage in realistic voice conversations and interact across text and images.
In addition, Nvidia's other clients, including Google DeepMind and Meta, have also released AI image or video generation platforms.
Last week, OpenAI has just released a new flagship generative AI model, GPT-4o, which supports text, voice, and video generation capabilities. It has a dialogue ability similar to that of humans, which is impressive. Meanwhile, competitors such as Google have also showcased similar new products.
Tesla fell 3.54%. On the afternoon of May 23rd, Tesla's Shanghai Energy Storage Super Factory started construction in the Lingang New Area of Shanghai. The Tesla Shanghai Energy Storage Factory covers a total area of approximately 200000 square meters and is located near the Tesla Shanghai Super Factory. This is also Tesla's first energy storage super factory project outside of the United States. Tesla Senior Vice President Zhu Xiaotong introduced that Tesla's Shanghai Energy Storage Super Factory is Tesla's first energy storage super factory outside of the United States, and it is also another large-scale investment project in China since Tesla entered China ten years ago, following the Shanghai Super Factory.
Apple fell 2.11%. Apple has appealed against the $2 billion fine imposed by the European Union, demanding the overturning of the $2 billion fine previously imposed by the European Commission. In March this year, the European Commission fined Apple 1.84 billion euros ($2 billion) on suspicion of abusing its dominant position in the music streaming application distribution market.
Energy stocks generally fell, with ExxonMobil, Western Oil, and Murphy Oil falling more than 1%, while US Energy, Petrobras, ConocoPhillips, Chevron, BP, and Shell fell slightly.
WTI crude oil futures in the United States fell 0.9% on Thursday, marking the fourth consecutive trading day of decline. So far this week, the cumulative decline in US WTI crude oil has exceeded 3%. On Thursday, West Texas Intermediate (WTI) futures for July delivery on the New York Mercantile Exchange fell 70 cents, a decrease of 0.6%, to close at $76.87 per barrel.
Analysts point out that due to investors' concerns that the Federal Reserve's approach of "maintaining higher interest rates for a longer period of time" will slow down US economic growth and reduce crude oil demand, crude oil prices continue to be under pressure.
UBS Group announced in its latest forecast that due to supply shortages in the oil market, it is expected that Brent crude oil prices will rise to $91 per barrel in the coming months. The bank further predicts that the eight OPEC+member countries participating in voluntary production cuts will extend the production reduction agreement by at least three months and emphasizes the importance of complying with the agreement. UBS also predicts that oil demand will increase by 1.5 million barrels per day in 2024, exceeding the long-term average annual growth of 1.2 million barrels per day. Based on the latest data, this growth expectation is even stronger.
OPEC proposed in its monthly report in May that it expects global oil demand to increase by 2.25 million barrels per day in 2024 and 1.85 million barrels per day in 2025. It is understood that, OPEC+， The Organization of the Petroleum Exporting Countries and its allies, led by Russia, plan to hold a meeting on June 1st to decide whether to extend the voluntary production reduction agreement into the second half of the year.
Most Chinese concept stocks fell, with Bilibili falling more than 12%
Chinese concept stocks collectively fell, with the Nasdaq China Golden Dragon Index falling 3.71%. Bilibili fell more than 12%, Beike fell nearly 10%, NIO fell more than 8%, Xiaopeng Motors and Century Internet fell more than 7%, New Oxygen fell nearly 7%, 36Kr and Xiaoniu Electric fell more than 6%, Ideal Automobile, Zhihu, and Tuniu fell more than 5%, Ctrip, JD, TAL, Monster Charging, and Bitmining fell more than 4%, Vipshop, NetEase, Futu Holdings, and iQiyi fell more than 3%, Autohome, Wuxin Technology, Alibaba, NetEase Youdao, and Xiaomi Group fell more than 2%, Tencent Music and Zhongtong Express fell more than 1%, while New Oriental, Baidu, Weibo, and Sohu fell slightly. Falling. Youke Factory rose by over 11%, Faraday Future rose by over 6%, Dingdong Maicai rose by over 5%, Pinduoduo rose by over 4%, and Miniso rose by nearly 1%.
Bilibili fell 12.37%. Bilibili released its financial report for the first quarter of 2024 as of March 31, with a total net revenue of 5.66 billion yuan, a year-on-year increase of 12%. The net loss was 764.6 million yuan, compared to a net loss of 629.6 million yuan in the same period last year. Not in accordance with US GAAP, the adjusted net loss was 455.9 million yuan, a year-on-year decrease of 56%.
The revenue from value-added services was 2.53 billion yuan (approximately USD 350.3 million), a year-on-year increase of 17%. The revenue from advertising was 1.67 billion yuan (approximately 231.1 million US dollars), a year-on-year increase of 31%. The revenue from mobile games was 9828 million yuan (approximately 136.1 million US dollars), a year-on-year decrease of 13%. The revenue from IP derivatives and other businesses was 484.3 million yuan (approximately 67.1 million US dollars), a year-on-year decrease of 5%.
Beike fell 9.96%. Beike released its financial report for the first quarter of 2024 as of March 31, with a net revenue of 16.4 billion yuan, a year-on-year decrease of 19.2%. The net profit was 432 million yuan, compared to 2.75 billion yuan in the same period last year. Not in accordance with US GAAP, the adjusted net profit was 1.392 billion yuan, compared to 3.561 billion yuan in the same period last year.
As of March 31, 2024, the number of Beike stores was 44216, a year-on-year increase of 7.1%. The number of active stores was 42593, a year-on-year increase of 7.5%. As of March 31, 2024, the total number of brokers for Beike was 442705, a year-on-year increase of 1.6%. The total number of active brokers was 399159, a year-on-year decrease of 3.0%. The average monthly active user (MAU) count for mobile in the first quarter of 2024 was 47.7 million, compared to 45.4 million in the same period of 2023.
NetEase fell 3.68%. The company released its financial report for the first quarter of 2024 as of March 31, with a net revenue of 26.9 billion yuan, a year-on-year increase of 7.2%. The net profit was 7.6 billion yuan, compared to 6.6 billion yuan and 6.8 billion yuan in the previous quarter and the same period last year, respectively. Not in accordance with US GAAP, the net profit was 8.5 billion yuan, compared to 7.4 billion yuan and 7.6 billion yuan in the previous quarter and the same period last year, respectively.
The net revenue from games and related value-added services was 21.5 billion yuan (approximately 3 billion US dollars), compared to 20.9 billion yuan and 20.1 billion yuan in the previous quarter and the same period last year, respectively. Among them, the net revenue from online game operations accounted for about 95.2% of the net revenue in this section, while the previous quarter and the same period last year were 93.4% and 92.7%, respectively. The net revenue from mobile games accounted for approximately 78.6% of the net revenue from online game operations, compared to 76.7% and 72.3% in the previous quarter and the same period last year, respectively.