On Thursday local time, the three major US stock indexes fluctuated.
As of the close, the Dow Jones Industrial Average rose 0.77%, the Nasdaq fell 0.79%, and the S&P 500 index fell 0.25%. The number of initial jobless claims in the United States last week was higher than expected, and in addition, the pace of new housing construction in the United States slowed to the slowest in four years in May.
Several central banks announced interest rate resolutions on Thursday, with the Bank of England and the Bank of Norway holding their ground. However, the Swiss central bank unexpectedly announced a rate cut, catching traders off guard and causing the Swiss franc to fall against the US dollar.
Most popular technology stocks fell, with Nvidia rising 3.8% at the beginning of the trading session to a peak of $140.76, and later diving 8% from a high level. On the news, NVIDIA CEO Huang Renxun has applied to sell 120000 shares of NVIDIA stock worth 16.3 million US dollars (approximately 120 million yuan).
The three major US stock indexes have mixed ups and downs
On Thursday, June 20th local time, the three major US stock indexes fluctuated. As of the close, the Dow Jones Industrial Average rose 299.90 points, or 0.77%, to 39134.76 points; The Nasdaq fell 140.64 points, or 0.79%, to 17721.59 points; The S&P 500 index fell 13.86 points, a decrease of 0.25%, to 5473.17 points.
In terms of economic data, the number of initial jobless claims in the United States for the week of June 15th decreased by 5000 to 238000, higher than the expected 235000. The previous value slightly increased from 242000 to 243000.
At the same time, the number of people applying for unemployment benefits in the United States for the week of June 8th increased to 1.828 million, slightly exceeding the expected 1.81 million, and the previous value was lowered from 1.82 million to 1.813 million.
In addition, the pace of new home construction in the United States declined to the slowest in four years in May, due to the weakening of the housing industry's development momentum earlier this year due to interest rate hikes. Government data released on Thursday showed that new housing construction decreased by 5.5% last month, with an annualized total of 1.277 million households, lower than market expectations. The monthly rate of construction permits for future construction has also decreased by 3.8%. The construction and permits for multi household and single household residential units have generally decreased.
Sam Stovall, Chief Investment Strategist at CFRA Research, stated that the US stock market will experience a pullback due to the three major unfavorable factors that will weigh on stock prices. This senior Wall Street insider pointed out that the stock market has performed strongly so far this year, with the S&P 500 index rising 15% in 2024. However, he predicts that the benchmark index will fall by 5% due to bearish factors such as interest rates, inflation, and stock valuations. The inflation rate is decreasing, but still higher than the Federal Reserve's target of 2%, leading Federal Reserve officials to expect only one rate cut by the end of this year. The rise in interest rates triggered the longest reversal in the yield curve of the 2/10 year US treasury bond bond, which is a famous indicator for the bond market to predict the upcoming recession. This indicator flashes when the yield of the two-year treasury bond bond exceeds the yield of the 10-year treasury bond bond.
Several central banks announced interest rate resolutions on Thursday, with the Bank of England and the Bank of Norway holding their ground. However, the Swiss central bank unexpectedly announced a rate cut, catching traders off guard and causing the Swiss franc to fall against the US dollar.
Technology stocks mostly fell, Nvidia dived
Most popular technology stocks fell, with Micron Technology falling more than 6%, Qualcomm falling more than 5%, Broadcom and Nvidia falling more than 3%, TSMC and Apple falling more than 2%, Texas Instruments and Tesla falling more than 1%, Asma falling 1%, and Netflix, Nokia, Dell Technology, Microelectronics, Microsoft, and Intel falling slightly; Chaowei Semiconductor rose more than 4%, Amazon, Cisco, and SAP rose more than 1%, while Google, Ericsson, and Meta saw a slight increase.
Nvidia reported $130.78, down 3.54%, with a market value of $3.2 trillion. It is worth noting that Nvidia rose 3.8% at the beginning of the trading session to a high of $140.76, and later jumped 8% from a high level. Data shows that against the backdrop of the artificial intelligence boom continuing to boost the stock market, Nvidia's stock price has risen by 164% so far in 2024.
The document shows that NVIDIA CEO Huang Renxun has applied to sell 120000 shares of NVIDIA stock worth 16.3 million US dollars (approximately 120 million yuan).
TSMC rose more than 2% before trading, but fluctuated and fell after opening, ultimately closing down 2.4% at $175.38, with a market value of over $900 billion and a cumulative increase of 70% this year. The surge in demand for artificial intelligence, coupled with potential price hikes in 2025, has led to multiple major banks raising their target prices.
Dell Technology rose nearly 8% at one point, while AMD Computer rose 10% during trading, but both stocks subsequently rose and fell. As of the close, Dell Technology fell 0.42%, while AMD Computer fell 0.26%. On the news front, Musk stated on social media platform X on Wednesday that Dell Technologies and Microelectronics will provide the necessary server racks for supercomputers built by his artificial intelligence startup xAI. Dell Technology CEO Michael Dell has stated that we are collaborating with Nvidia to build a Dell AI factory to support the large model Grok of Musk's xAI company.
Amazon rose 1.8%. Amazon promises to invest another 10 billion euros in German cloud computing and logistics networks. Amazon, the world's largest provider of cloud computing services and data storage, announced on Wednesday that as the technology giant expands its data center network globally, it will invest an additional 10 billion euros ($10.7 billion) in its cloud infrastructure and logistics network in Germany. The company stated that its latest plan includes investing 8.8 billion euros by 2026 to build and maintain cloud infrastructure for AWS cloud computing business in the Frankfurt region. In addition to this commitment, the company also plans to invest 7.8 billion euros to establish a sovereign cloud business in Germany by 2040. Amazon has made several similar commitments globally this year. Amazon announced last month that by 2033, it will invest 15.7 billion euros in Spain and 1.2 billion euros in France for infrastructure and computing.
In terms of other stocks, Lilly fell 0.61%. The company has increased its crackdown on counterfeit and non branded products of the best-selling weight loss drug Zepbund, stating that it has filed more lawsuits against companies selling compound formulations of the drug. On Thursday, the pharmaceutical company filed several new lawsuits against medical spa centers, health centers, and other companies, claiming that these companies used Lilly's Mounjaro and Zepbound when mentioning their products. Lilly stated in a letter to the patient that it does not provide its pharmaceutical ingredients to the compound pharmaceutical company.
Renowned US retailer KR. US fell 3.27%. Before the US stock market closed on June 20th, Kroger announced its financial results for the first quarter of 2024. The financial report data shows that Kroger's same store sales and profits have exceeded Wall Street's expectations, partly due to ongoing inflation in the United States and the tightening of more household budgets, with more customers flocking to its stores to buy cheap groceries, especially cheap food.
According to financial report data, Kroger's total sales in the first quarter were $45.3 billion, slightly higher than analysts' general expectations, with a slight increase of 0.3% compared to the same period last year; In the first quarter, the same store sales of the chain supermarket (excluding fuel projects) increased by 0.5% year-on-year, while analysts generally expect a growth rate of only 0.13%.
According to public information, Kroger is one of the largest chain grocery brands in the United States, offering a wide range of products including food, health and beauty products, pharmaceuticals, and fuels. Albertson also operates food and drug retail, with a network of stores throughout the United States that offer groceries, general merchandise, health and beauty care products, pharmacies, fuel, and other items.
Bilibili surged by over 5%
Popular Chinese concept stocks fluctuated, with the Nasdaq China Golden Dragon Index falling 1%. Bilibili rose by over 5%, Baozun E-commerce rose by 5%, Xiaomi Group rose by over 4%, New Oxygen, Douyu, Monster Charging rose by over 3%, Miniso rose by over 2%, NetEase, Weibo, Xiaoniu Electric, Autohome, Beike, iQiyi, and Ctrip rose slightly; Faraday Future fell more than 14%, 36Kr fell more than 7%, Vipshop fell more than 4%, Zhihu fell more than 3%, TAL, Tuniu, Gaotu, Zhongtong Express, Baidu, NIO, and Dingdong Maicai fell more than 2%, Futu Holdings, Century Internet, Ideal Automobile, Fangduoduo, New Oriental, Manbang, and JD.com fell more than 1%, while Alibaba and Pinduoduo fell slightly.
Bilibili rose 5.38% to $17.05. On the news side, Bilibili released the game "Three Kingdoms: Plan the World" on June 13th, and its performance exceeded expectations. Diandian Data points out that the game ranked second on the free list and third on the iOS game bestseller list on the first day of public beta. As of June 18th, the game still ranks third on the best-selling list, second only to Tencent's Dungeons and Braves and Honor of Kings, and surpassing Peace Elite and NetEase's Against the Wind mobile game. Citigroup expects that if the mobile game can maintain its position in the top 10, its revenue in the first month will reach 700 million to 1 billion yuan; Give Bilibili a target price of $15.5 and a rating of "neutral".
JPMorgan Chase has released a report stating a more positive outlook for Bilibili's stock price in the next 6 to 12 months, with an investment rating raised from "neutral" to "overweight" and a target price raised from HKD 110 to HKD 165. Bank of America Securities has released a report, raising its earnings forecast for Bilibili from 2% to 7% per share this year and the target price for the Hong Kong stock from HKD 140 to HKD 142. At the same time, it has raised its compound growth rate forecast from 26% to 27% from 2025 to 2030, reaffirming its "buy" rating and optimistic about advertising trends and recent new games.
NetEase rose 0.99%. The Goldman Sachs report pointed out that maintaining a constructive attitude towards NetEase, its game "FWJ" has had an indelible but controllable impact on the second quarter of computer game revenue. FWJ is still undergoing structural transformation towards a new economic model, and it is believed that its terminal value remains unchanged. Believing that the market has digested the factors of weakness in the second quarter, we maintain the "buy" rating of this stock and extend its US stock target price of $125 and Hong Kong stock target price of HKD 196.
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