On Monday, July 1st local time, the three major US stock indexes collectively closed higher. As of the close, the Dow Jones Industrial Average rose 0.13%, the Nasdaq rose 0.83%, and the S&P 500 index rose 0.27%.
In terms of economic data. According to data released by the Institute for Supply Management (ISM) in the United States, the manufacturing PMI for June was 48.5, with an expected 49.1, compared to the previous value of 48.7.
Chip manufacturer Nvidia is facing increasing regulatory scrutiny. According to sources cited by the media, French regulatory authorities will file an antitrust lawsuit against Nvidia, making it the world's first law enforcement agency to take antitrust action against the company.
The ISM manufacturing industry in the United States has been shrinking for three consecutive months
On Monday, July 1st local time, the three major US stock indexes collectively closed higher. As of the close, the Dow Jones Industrial Average rose 50.66 points, or 0.13%, to 39169.52 points; The Nasdaq rose 146.70 points, or 0.83%, to 17879.30 points; The S&P 500 index rose 14.61 points, or 0.27%, to 5475.09 points.
The S&P 500 index rose slightly by 0.27%. Tesla surged over 6%, and according to Tesla China Weibo on July 1st, it will provide consumers with benefits such as 5-year zero interest for car purchases in July. Chewy's stock price plummeted significantly as retail leader Keith Gill disclosed his passive stake in the online pet product retailer. Boeing will repurchase Spirit AeroSystems at a price of $37.2 per share, valued at $4.7 billion. French regulatory authorities will file an antitrust lawsuit against Nvidia, making it the world's first law enforcement agency to take antitrust action against the company.
The yield on US Treasury bonds mostly rose. The 2-year US Treasury yield fell 0.6 basis points to 4.766%, the 3-year US Treasury yield increased 1.7 basis points to 4.583%, the 5-year US Treasury yield increased 3.7 basis points to 4.432%, the 10-year US Treasury yield increased 5.9 basis points to 4.468%, and the 30-year US Treasury yield increased 6.2 basis points to 4.627%.
International precious metal futures closed slightly higher, with COMEX gold futures up 0.1% to $2341.9 per ounce and COMEX silver futures up 0.64% to $29.75 per ounce.
According to data released by the Institute for Supply Management (ISM) in the United States, the manufacturing PMI for June was 48.5, with an expected 49.1, compared to the previous value of 48.7. The manufacturing index has been shrinking for three consecutive months.
On the sub item data, the new order index is 49.3, expected to be 49, with a previous value of 45.4, indicating that the order volume is approaching stability. The production index fell from 50.2 to 48.5. The price payment index is 52.1, the slowest cost growth rate of the year, expected to be 55.8, with a value of 57 before May. The price index fell 4.9 points in a single month, the largest decline since May last year. The employment index is 49.3, expected to be 50, with a previous value of 51.1. Nine industries reported a contraction in activity, with the textile, machinery, and metal products industries performing the worst, and eight industries showing an increase in activity.
Timothy Fiore, Chairman of the ISM Manufacturing Business Survey Committee, said in a statement, "Due to current monetary policy and other conditions, companies are unwilling to invest in capital and inventory, so demand remains sluggish. Production execution rates have decreased compared to last month, which may lead to a decrease in revenue and put pressure on profitability."
The Markit Manufacturing PMI released earlier on the same day showed that the US June Markit Manufacturing PMI had a final value of 51.6, an expected value of 51.7, and an initial value of 51.7.
Chris Williamson, Chief Business Economist for S&P Global Market Intelligence, said, "The S&P Global PMI survey shows that US manufacturers struggled to achieve strong production growth in June, dragged down by weak demand in domestic and export markets. Although the PMI was positive for five months in the first six months of 2024 and only one month in 2023, the growth momentum remains dismal and weak."
French regulatory authorities will file antitrust lawsuits against Nvidia
In terms of sectors, the 11 major sectors of the S&P 500 index rose 5 times and fell 6 times. Among them, stocks in the information technology sector led the rise, while stocks in the materials sector led the decline.
Most popular technology stocks rose. Tesla rose more than 6%, Apple rose nearly 3%, Broadcom, Microsoft, Amazon rose more than 2%, Asmart rose more than 1%, Lilly rose nearly 1%, Nvidia, Google A, Qualcomm, Meta, Texas Instruments, Cisco rose slightly, Micron, Netflix, Intel, TSMC, and AMD saw a slight decline, while Chaowei Semiconductor and Arm fell more than 2%.
Tesla surged 6.05%, rising for five consecutive trading days. According to Tesla China Weibo on July 1st, a "triple benefit" will be provided for consumers to purchase cars in July. Firstly, a maximum 5-year zero interest and low interest discount car purchase policy will be launched for the Model 3/Y standard range version, with a minimum daily supply of 85 yuan; Secondly, a maximum 5-year zero interest and low interest purchase discount policy will be introduced for the Model 3/Y Long Range All Wheel Drive version, with a minimum daily supply of 107 yuan; Finally, the annual fee rate for limited time and low interest rates in July has dropped to a starting point of 0.5% (equivalent to an annualized interest rate of 0.93%). In this promotional event, a down payment of 79900 yuan can be chosen as a "5-year zero interest" option: the Model 3 rear wheel drive version has a minimum daily supply of 85 yuan, and the long range all wheel drive version has a minimum daily supply of 107 yuan; The daily supply of the ModelY rear wheel drive version is as low as 95 yuan, while the long-term all wheel drive version is as low as 118 yuan. Compared to the previous standard annual fee rate of 2.5%, ModelY can save up to 26000 yuan in interest.
NVIDIA plunged during the trading session, dropping over 3.5% at one point. As of the close, it rose 0.62%.
According to Reuters, French antitrust enforcement agencies are preparing to file charges against Nvidia for suspected anticompetitive behavior. Reuters quoted sources familiar with the matter as saying that French antitrust enforcement agencies will be the first in the world to take such measures. This accusation was made after a surprise inspection of Nvidia's office last year.
Last September, French antitrust enforcement officers raided the office of a company suspected of engaging in "anti competitive behavior in the graphics card industry.". At that time, they did not specify that the company was NVIDIA, but NVIDIA later admitted that France was reviewing its business practices. Nvidia stated in a February document that officials from the United States, the European Union, and the United Kingdom are also reviewing its business operations. The fine for violating French antitrust laws can reach up to 10% of the company's global annual revenue. It is understood that the maximum fine imposed by the French antitrust agency since 2011 was 1.24 billion euros in 2020, of which Apple was fined 1.1 billion euros, and the remaining portion was fined to two distributors.
Last November, French Finance Minister Bruno Le Mer stated that Nvidia's dominant position led to "increased inequality" between countries and suppressed fair competition. He pointed out that 92% of GPUs come from Nvidia. Bruno Lemaire said, "To achieve fair competition, it is necessary to have multiple companies involved, rather than having one company monopolize the sales of all equipment."
Google A rose 0.46%. Google announced on Monday that it will force advertisers to disclose advertisements that use digital content to depict real people or events, in its latest move to combat false information. The rapid development of generative artificial intelligence has raised concerns about its potential misuse, as it can create text, images, and videos based on prompts within seconds. The rise of deep forgery technology further blurs the boundary between truth and falsehood. Google has stated that it will generate advertising disclosures in information streams and short videos on mobile devices, as well as in computer and television streaming. For other formats, advertisers need to provide significant "prominent disclosures," and the language of disclosure will vary depending on the specific situation of the advertisement.
Amazon rose 2.04%. According to The Wall Street Journal, Amazon is planning to invest over $100 billion in building data centers over the next 10 years. This company currently invests more in data center infrastructure than in retail warehouses. John Felton, Chief Financial Officer of Amazon Cloud Services (AWS), said that the current construction of artificial intelligence feels like building a massive logistics network in the past few years. According to market research firm Dell'OroGroup, Amazon's expenditure on data center capital expenditure (including leasing) reached a decade high of 53% compared to total capital expenditure last year.
Most large bank stocks closed higher. Goldman Sachs, Morgan Stanley, and Wells Fargo rose more than 2%, JPMorgan Chase and UBS Group rose more than 1%, Bank of America rose slightly, while Citigroup and BlackRock fell slightly.
Energy stocks saw mixed gains and losses. Shell, BP, Petrobras, and Chevron saw a slight increase, while US energy closed flat. ConocoPhillips, ExxonMobil, Western Petroleum, and Murphy saw a slight decline.
Most popular Chinese concept stocks rose, with the Nasdaq China Golden Dragon Index rising 0.79%. NIO and Ideal Automobile rose by over 6%, Xiaopeng Automobile rose by over 5%, Tencent Music rose by over 2%, New Oriental rose by over 1%, NetEase, Weibo, Alibaba, and Pinduoduo rose slightly, JD.com, Baidu, and Bilibili fell by over 1%, while Futu Holdings, Manbang, and iQiyi fell by over 2%.
NIO rose 6.73%, Ideal Automobile rose 6.71%, and Xiaopeng Automobile rose 5.18%. In terms of data, NIO Automobile delivered 21209 new cars in June, a year-on-year increase of 98%, reaching a historic high; In the second quarter, NIO delivered 57373 new cars, exceeding the delivery guidelines, with a year-on-year increase of 143.9%; In the first half of 2024, NIO delivered a total of 87426 new cars, a year-on-year increase of 60.2%. Xiaopeng Motors delivered 10668 electric vehicles in June, a year-on-year increase of 24% and a growth of 5% compared to the previous month. Xiaopeng Motors reported delivering 52028 electric vehicles in the first half of the year, a year-on-year increase of 26%. Ideal Automobile delivered 47774 new cars in June, a year-on-year increase of 46.7%; 108000 vehicles were delivered in the second quarter, a year-on-year increase of 25.5%. Li Xiang, the chairman of Ideal, revealed that in June, the delivery volume of Ideal L6 exceeded 20000 units, and under the dual effect of improving store efficiency, Ideal Automobile returned to the top of China's new force brand sales rankings. Next, Ideal will fully promote ADMax without image NOA in early July, achieving nationwide availability.
European Central Bank President Lagarde: The central bank needs time to assess the uncertainty of inflation
European Central Bank President Lagarde stated that the ECB is not in a hurry to further cut interest rates. In her speech on Monday, she pointed out that the central bank needs more time to confirm the target of inflation steadily falling to 2%, and the current economic development shows that interest rate cuts are not urgent.
After the first rate cut in June, the European Central Bank did not commit to subsequent rate cuts, believing that the current outlook was too uncertain to predict a second rate cut in advance. Lagarde stated at the policy meeting of the European Central Bank that a strong labor market allows the central bank more time to collect new data to determine that inflation risks above target have subsided.
The European Central Bank is working hard to find a balance between inflation uncertainty and economic weakness. Although economic weakness may strengthen the rationale for interest rate cuts, inflationary uncertainty requires caution. Lagarde also acknowledges that although the economy rebounded in the previous quarter, it is still uncertain whether the eurozone can avoid a recession. She pointed out that a "soft landing" is not guaranteed to be achieved, and the growth prospects are still uncertain.
The recent economic growth indicators have been weaker than expected, challenging the view that the economy is starting to recover after a year and a half of stagnation. However, investors believe that inflation concerns will outweigh recession fears, and the European Central Bank will remain cautious in lowering interest rates. Investors expect to cut interest rates one to two more times this year, with a total of four cuts by the end of 2025. Lagarde pointed out that future inflation still faces multiple uncertainties, especially how the relationship between profits, wages, and productivity evolves, and whether the economy will be impacted by new supply side shocks.