U.S. stocks closed higher on Wednesday, with major indices partially recovering from the significant losses suffered in the previous trading session.
NVIDIA briefly surpassed Google to become the third-largest company by market capitalization in the U.S.
Investors are closely monitoring U.S. earnings reports, the Federal Reserve’s interest rate policy outlook, and awaiting the latest inflation data including retail sales and PPI.
Following the release of better-than-expected CPI data, traders assessed that the probability of a Fed rate cut in May decreased from around 64% before the inflation data to approximately 32%, and anticipate three rate cuts this year totaling around 75 basis points.
Terry Sandven, Chief Equity Strategist at Bank of America Wealth Management, stated that despite the January CPI report potentially pushing back the Fed’s first rate cut from the initial expectation of March to the second half of 2024, the upward trend in U.S. stocks has not yet ended.
U.S. Stock Market
Fundamental Analysis:
Most large-cap tech stocks rose, with Tesla, Meta, and NVIDIA up over 2%. NVIDIA’s stock price surpassed Google’s, making it the third-largest company by market capitalization in the U.S. Amazon rose over 1%, while Microsoft and Google saw slight gains.
The semiconductor sector strengthened, with ARM up over 5%, AMD up over 4%, and Uber up nearly 15% after announcing a board authorization for a share repurchase of up to $7 billion.
Popular Chinese stocks surged, with the Nasdaq Golden Dragon China Index closing up 3.45%.
TAL Education and Gaotu Techedu rose over 6%, while NIO and XPeng Motors surged over 5%. JD.com, Bilibili, Alibaba, Pinduoduo, NetEase, and Baidu rose over 2%.
Technical Analysis:
(S&P 500 Index, 1-day chart)
Market Trends:
- Dow Jones rose 151.52 points, or 0.40%, to close at 38,424.27.
- Nasdaq rose 203.55 points, or 1.30%, to close at 15,859.15.
- S&P 500 Index rose 47.45 points, or 0.96%, to close at 5,000.62.
Hong Kong Stock Market
Fundamental Analysis:
The three major indices in the Hong Kong stock market experienced a rebound after probing lower levels earlier in the day.
Among them, tech stocks mostly rose, led by JD.com, which rose nearly 2%. Xiaomi and Alibaba rose nearly 1%, while Tencent fell nearly 1%.
Automotive stocks showed mixed performance, with NIO rising over 3%.
Stocks related to digital currency concepts surged, with Nova Technology Holdings rising nearly 16%.
The pharmaceutical sector, particularly the Pharmaron group, continued to decline, with Pharmaron Biological falling over 2%.
Real estate stocks recorded significant declines, with Greentown China falling over 4%.
Tech stocks mostly rose, led by a nearly 2% increase in JD.com’s share price.
On the news front, overseas institutions have successively increased their holdings of Chinese stocks. Michael Burry’s hedge fund, Scion Asset Management, increased its holdings in Alibaba and JD.com in the fourth quarter of last year.
Technical Analysis:
(Hang Seng Index, 1-day chart)
Market Trends:
- Hang Seng Index (HSI) rose 0.43% to close at 15,947.63.
- Hang Seng Tech Index (HSTECH) rose 0.64% to close at 3218.46.
- Hang Seng China Enterprises Index (HSCEI.) rose 0.32% to close at 5,403.73.
FTSE China A50 Index
Fundamental Analysis:
On February 13th, 2024, trading in A shares officially concluded for the lunar Year of the Rabbit.
A shares will be closed from February 9th to February 18th, with the first trading day of the Year of the Dragon scheduled for February 19th.
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