2024-01-11 22:34:46
U.S. Stock Diary｜Inflation exceeds expectations, stock market is under pressure, Bitcoin price rises first and then recovers (ANGELA WEISS via Getty Images)
U.S. inflation data was higher than expected, and the three major U.S. stock indexes closed nearly flat, with gains and losses within 0.1%. Both monthly and year-on-year CPI increases were higher than expected, causing the market to delay expectations for the start of interest rate cuts by the U.S. Federal Reserve, putting pressure on the stock market. However, this did not prevent Nvidia from setting a new closing high for the fourth consecutive day. The Bitcoin ETF was listed on the first day, with trading volume reaching US$4.6 billion. Bitcoin prices once rose above a two-year high, but then fell back, and cryptocurrency-related stocks also generally fell.
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Market conditions on January 11 (Thursday)
l The Dow Jones index rose 15.29 points, or 0.04%, to 37,711.02 points.
l The S&P 500 index fell 3.21 points, or 0.07%, to 4,780.24 points.
l The Nasdaq index rose 0.54 points or 0.00% to 14,970.19 points.
l New York January oil futures closed at US$72.02 a barrel, down US$0.65 or 0.9%.
l New York February gold futures closed at $2019.20 an ounce, down $13.8 or 0.42%.
l The U.S. 10-year Treasury bond yield closed at 3.977%, down 5.3 points.
Inflation data was hotter than expected, and U.S. stocks were weak. However, chip stock Nvidia hit a record high for the fourth consecutive trading day, exceeding $550 during the trading session, and closed up 0.9% at $548.
On the first day of trading for the first batch of spot Bitcoin ETFs in the United States, trading volume reached US$4.6 billion. Bitcoin hit US$49,000 on Thursday, a new high since December 2021, but has since fallen back to hovering around US$46,000. Investors received good news, and cryptocurrency concept stocks generally fell. Riot Platforms and Marathon Digital, the two largest mining stocks, fell by 15.8% and 12.6% respectively.
The latest weekly poll from the American Association of Individual Investors shows retail investor optimism about the near-term outlook for the stock market over the next six months once again remains at “exceptionally high levels.” In the week ending Wednesday, investors’ bullish sentiment remained unchanged at 48.6%, above the historical average of 37.5% for the 11th time in 10 and 14 consecutive weeks. Bearish sentiment increased slightly, to 24.2% from 23.5% last week, but remained below the historical average of 31% for the tenth consecutive week.
In terms of data, the U.S. Department of Commerce announced that the U.S. Consumer Price Index (CPI) rose 0.3% month-on-month in December. In December, CPI increased by 3.4% year-on-year, the largest increase in three months, and core CPI increased by 3.9%, both of which were higher than market expectations.
The U.S. Department of Labor announced that 202,000 people filed for unemployment benefits in the week ending January 6, less than the 210,000 expected. Data showed that the number of people continuing to apply for unemployment assistance fell by 34,000 to 1.834 million, which was also lower than market expectations.
The swap market shows that the possibility of the Federal Reserve cutting interest rates in March and May has declined after the release of U.S. CPI data.
Affected by the CPI data, U.S. Treasury bond interest rates rose. The 10-year bond interest rate once rose to a high of 4.068%, but fell back to 3.98% at the close.
Cleveland Fed President Mester said that the latest U.S. CPI did not change his view on the Fed’s monetary policy. He believes that it is in a good state, and the latest CPI number only reflects that the Federal Reserve’s task has not yet been completed. He expects inflation to continue to slow. It may be too early to consider cutting interest rates in March.
Alexandra Wilson-Elizondo, investment director at Goldman Sachs Asset Management, said, “There is nothing in the inflation data that will cause the Fed to accelerate the start of interest rate cuts. However, because the inflation data is not overheated, hopes for a soft landing for the economy should not be affected. We will focus on The labor market will determine the speed and extent of the interest rate cut cycle. We still think there is a better chance of interest rate cuts starting in the middle of this year.”
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