On Friday, November 3rd, Eastern Time, heavyweight economic data boosted the market, and the US stock bond market collectively closed higher, with the three major stock indices achieving their best weekly performance in a year.
US Treasury Secretary Yellen's latest announcement! It is stated that more non bank financial institutions will be listed as strictly regulated objects.
The offshore RMB surged by 400 points during the session, breaking below 7.29 for the first time in three weeks!
Popular Chinese concept stocks collectively rose, with the Nasdaq Golden Dragon China Index closing up nearly 3%, with NIO up over 5% and Pinduoduo up 5%.
US Treasury Secretary Yellen's latest statement
According to Bloomberg, after months of repeated discussions, US Treasury Secretary Yellen announced on Friday, November 3rd local time that senior officials have voted on a new framework for defining systemically important financial institutions. Being labeled as' too big to fail 'can bring huge compliance costs and regulatory challenges, and since its launch more than a decade ago, it has mainly been the large Wall Street banks that have been labeled.
Yellen did not name which institutions would be included in stricter regulations. But this new procedure may result in some large non banking financial companies being subject to stricter regulation.
Yellen stated that it will "provide strong procedural protection for companies under evaluation, including important participation and communication from the Financial Stability Supervision Commission, and provide opportunities to listen to the opinions of these companies". She also stated that the top regulatory body voted to release a new "Financial Stability Risk Analysis Framework" to better explain how it assesses and responds to potential risks.
Heavy Economic Data Boosts US Stock and Bond Market Carnival
On Friday, November 3rd, Eastern Time, the non farm employment report released on that day showed an unexpected cooling in the strong labor market. The report shows that the non farm employment population in the United States increased by 150000 people after the quarterly adjustment in October, the smallest increase since June and less than the market's expected 180000 people. The US unemployment rate recorded 3.9% in October, the highest level since January 2022, with market expectations of 3.8%.
The US Bureau of Labor Statistics states that job growth occurs in the fields of healthcare, government, and social assistance. Due to strike activities, the number of employment in the manufacturing industry has decreased.
The US ISM non manufacturing index for October, which was subsequently released, exceeded expectations and fell to a five month low of 51.6. The sub index employment index recorded the largest decline since April last year, reflecting a slowdown in US service industry activity and a cooling in employment.
The non farm employment report strengthens market expectations that the Federal Reserve has completed interest rate hikes. After the release of the non farm payrolls report, the yield of the benchmark 10-year US treasury bond bond fell rapidly to below 4.60%, boosting the stock market. As of the date of receipt, the yield of the US 10-year treasury bond bond was 4.576%.
The three major stock indexes in the United States collectively opened high for the fifth consecutive day, maintaining their upward trend in the early trading session, but later narrowing their gains. Finally, the collective closed higher for four consecutive days. As of the close, the Nasdaq rose 1.38% to 13478.28 points. The S&P rose 0.94% to close at 4358.34 points. The Dow closed up 222.24 points, or 0.66%, at 34061.32. All three major stock indices have achieved their best weekly performance of the year.
Federal Reserve official Barkin said he is pleased to see the pressure on employment data ease. We will not prejudge the next steps of the Federal Reserve. Before the next interest rate decision, the Federal Reserve still has more data to observe. It is expected that the market will reflect the upcoming economic data. It is uncertain that 25 basis points can solve all global problems. In order to control inflation, measures must be taken to address it. He said that in his personal opinion, there is still some time before interest rate cuts.
Federal Reserve official Bostick stated that the Fed still has time to wait and see and needs to be patient. May support maintaining the current interest rate level for approximately 8-10 months. But if inflation expectations rise, the Federal Reserve must take action. The possibility of moderate policy adjustments must be considered. Inflation is expected to cool down next year, and the Federal Reserve may consider lowering interest rates in the future. It is reasonable to make some policy changes before inflation returns to 2%.
The Chief Market Economist of Sparta Capital Securities analyzed that October's non farm report was a weak one, although some of the reasons may be due to the (UAW) strike. But hourly wages only increased by 0.2%, and the participation rate decreased to 62.7%. This is a good sign that the labor market is weakening and is benefiting the Federal Reserve. This should be beneficial for the stock market. This may indicate that the Federal Reserve has once again suspended interest rate hikes in December, which will indicate that the Federal Reserve has completed the hike.
Offshore RMB surged by 400 points during trading!
On Friday, November 3rd, Eastern Time, the US dollar index plummeted sharply, causing the RMB exchange rate to rise. The offshore RMB surged by 400 points during the day, breaking below 7.29 for the first time in three weeks.
Popular Chinese concept collective rise
On Friday, November 3rd, Eastern Time, popular Chinese concept stocks collectively rose, with the Nasdaq Golden Dragon China Index closing up nearly 3%.
Among the popular Chinese concept stocks, NIO rose by over 5%, Pinduoduo rose by 5%, Vipshop rose by 6.01%, Bilibili rose by 5.99%, TAL rose by 5.94%, JD.com rose by 4.38%, Xiaopeng Automobile rose by 3.63%, Tencent Music rose by 3.17%, Ideal Automobile rose by 2.92%, Baidu rose by 2.44%, and Alibaba rose by 2.28%.