On September 4th local time, most European and American stock markets fell, and most major market stock indices experienced a pullback, but the magnitude narrowed. Nvidia continues its downward trend, with a total market value evaporating over 3.84 trillion yuan in the past five trading days. Regarding media reports that the US Department of Justice has issued subpoenas to Nvidia for antitrust investigations, Nvidia has issued a statement stating that it has inquired with the US Department of Justice and has not yet received a subpoena. International oil prices have once again weakened, hitting a new low this year during trading.
From a macroeconomic perspective, the United States and Canada each have important points to consider: the Federal Reserve has released its latest economic status brown book, which predicts that although economic activity in most regions remains stable or has declined, future economic activity is expected to remain stable or improve; The Bank of Canada has cut interest rates by 25 basis points three times in a row, but it also implies the risk of inflation rebounding.
Nvidia continues its pullback
From the overall performance of European and American stock markets, data shows that as of the close, the Dow Jones Industrial Average rose 0.09%, the S&P 500 index fell 0.16%, and the Nasdaq fell 0.3%; In Europe, the FTSE 100 index in the UK, the CAC40 index in France, and the DAX index in Germany collectively fell, but all fell less than 1%.
In terms of industry sectors, the rise and fall of US technology stocks are mixed. Nai soared 0.65%, META rose 0.19%, Microsoft fell 0.13%, Google parent company Alphabet fell 0.58%, Apple fell 0.86%, and Amazon fell 1.66%.
Chip stocks have fluctuated in price. AMD rose 2.87%, Qualcomm rose 1.28%, Intel fell 3.33%, and ASML fell 4.01%. Nvidia's stock price fell another 1.66%, and the company's stock price has adjusted in the past 5 trading days. The total market value has evaporated by more than 540 billion US dollars, equivalent to over 3.84 trillion yuan, averaging nearly 770 billion yuan evaporated per day.
Popular Chinese concept stocks fluctuate in price. The Nasdaq China Golden Dragon Index fell slightly, while Autohome rose 6.94%, Daquan New Energy rose 5.19%, Zhihu rose 4.84%, Dingdong Maicai rose 4.28%, and Yamafon Sports rose 3.14%; Yihang Intelligent fell 11.95%, Dajian Cloud Warehouse fell 7.7%, Lotus Technology fell 5.47%, Pinduoduo fell 5.12%, and Douyu fell 4.37%.
The Federal Reserve's Beige Book:
Most regions' economies remain stable or decline
Due to concerns about the economic recession in the United States, the stock market suffered a heavy blow the previous day. However, the latest economic report released by the Federal Reserve shows that although economic activity in most parts of the United States remains stable or has declined, it is expected to remain stable or improve in the future.
Specifically, compared to the previous report, the brown book shows that the number of regions with stable or declining economic activity in the United States has increased from 5 to 9, with only 3 regions experiencing slight growth in economic activity; In terms of the labor market, some regions have reported that some companies have reduced the number of employees by reducing work shifts and hours, giving up positions advertised in job advertisements, or through employees resigning on their own, but direct layoffs are still rare; In terms of wages, overall they are still growing at a moderate pace, consistent with the trend described in recent reports.
In terms of prices, although there has been a slight increase in overall prices recently, the magnitude is not significant; The non labor costs of enterprises are mostly described as "moderate to moderate increases" and overall have eased. Looking ahead, various regions generally believe that price and cost pressures are expected to remain stable or ease in the coming months.
Throughout the history of the United States, in order to curb inflation, the Federal Reserve has typically chosen to raise interest rates. However, raising interest rates often leads to excessive credit tightening, which in turn triggers economic downturns. Regarding whether the US economy can achieve a soft landing this time, CICC believes that the improvement in supply will help alleviate inflation without harming the economy and create favorable conditions for achieving a soft landing; In terms of monetary policy, it is expected that the Federal Reserve will adopt a gradual interest rate cut, but will also adjust flexibly based on economic data, and may increase the pace of interest rate cuts if necessary.
International oil prices hit a new low this year
In terms of commodities, international gold and silver prices rose slightly overnight, but oil prices continued their downward trend from the previous day. As of 5:50 am Beijing time on September 5th, the main contracts for NYMEX crude oil futures and ICE Brent crude oil futures have both fallen more than 1%, hitting new lows this year during trading. The former has also fallen below the $70 per barrel mark.
Reflected in the stock market, overnight US energy stocks fell across the board. ExxonMobil fell 0.92%, ConocoPhillips fell 0.97%, Western Petroleum fell 1.11%, Schlumberger fell 1.36%, and Chevron fell 1.88%.
In the view of CITIC Futures, the sharp drop in international oil prices and the supply from Libya are one of the core drivers of the market. The Libyan central bank said that various factions are close to reaching an agreement and are expected to resume oil production. The US August PMI data released on Tuesday fell short of expectations, once again fueling market concerns about the economic outlook. Oil prices continued to decline amid expectations of deteriorating supply and demand. Looking ahead to the future, crude oil prices may maintain a converging and fluctuating trend in the short term, with moderate upward momentum in the medium-term fundamentals.
The Bank of Canada announces
The third interest rate cut this year
On the evening of September 4th Beijing time, the Bank of Canada announced another interest rate cut, lowering the benchmark interest rate from 4.5% to 4.25% by 25 basis points, in line with market expectations. Horizontally speaking, among the central banks of important overseas economies that have announced interest rate cuts since the beginning of this year, the Bank of Canada is one of the few central banks that has continuously cut interest rates and has done so three times.
According to the official website of the Bank of Canada, it has maintained the benchmark interest rate at 5% for nearly a year since July 2023. With inflation falling, in June 2024, the Bank of Canada announced a 25 basis point reduction in its benchmark interest rate to 4.75%, becoming the first G7 country to announce a rate cut in 2024. Afterwards, at the July interest rate meeting, the Bank of Canada cut interest rates again, further lowering the benchmark rate to 4.5%.
It is worth noting that while the Bank of Canada announced another interest rate cut, it also hinted at the risk of inflation rebound in the announcement: the excess supply in the economy is continuing to push down inflation, while the rising prices of housing and other services are pushing up inflation. High housing prices remain the biggest contributor to overall inflation, and the Bank of Canada's Board of Governors is carefully evaluating these opposing forces that affect inflation.