Tuesday Market Overview
US stocks closed mixed on Tuesday, with the Nasdaq recording its fifth straight day of losses. Rising US Treasury yields continued to weigh on technology stocks, while the 30-year yield climbed back above 5%. Investors are digesting weaker-than-expected December PPI data and anticipating Wednesday’s CPI inflation report and earnings from major banks.
Inflation Concerns Persist
The 30-year US Treasury yield breached the 5% mark for the second time since last Friday, while the 10-year yield rose to 4.81%, both reaching their highest levels since November 2023.
The US Labor Department is set to release the widely watched Consumer Price Index (CPI) report on Wednesday. Following last week’s robust nonfarm payrolls data, both December PPI and CPI will serve as crucial catalysts for assessing the Federal Reserve’s next policy steps.
Adam Turnquist, Chief Technical Strategist at LPL Financial, commented:
“In the short term, the market has returned to a phase where good news is perceived as bad news. However, it’s important to remember that over the long term, strong economic data typically supports equities by signaling better-than-expected growth, higher earnings potential, and reduced recession risks.”
US Stock Market Overview
Major Tech Stocks
Most large-cap tech stocks declined, with Tesla, Nvidia, and Netflix dropping over 1%. Meta fell more than 2% amid plans to cut 5% of its lowest-performing workforce. Eli Lilly tumbled 6.6%, its worst single-day performance since March 2021, after forecasting weaker-than-expected Q4 sales of its weight-loss drug.
Chinese Stocks
Chinese stocks outperformed, with key gainers including:
- XPeng: +6%
- JD.com: +4%
- Kingsoft Cloud, Bilibili: +3%
- Li Auto, Miniso, Pinduoduo: +2%
- NetEase, Baidu, Alibaba: +1%
Technical Analysis of US Market
Market Recap
- Dow Jones: +221.16 points (+0.52%), closing at 42,518.28
- Nasdaq: -43.71 points (-0.23%), closing at 19,044.39
- S&P 500: +6.69 points (+0.11%), closing at 5,842.91
Hong Kong Stock Market Overview
Performance Overview
Hong Kong stocks opened lower but rebounded by the close.
- Tech Stocks: Mixed performance with NetEase up 2%, Tencent and JD.com gaining 1%, while Kuaishou and Xiaomi fell about 1%.
- Gold Stocks: Led declines, with Zijin Mining down over 5%. Analysts attribute this to fluctuating inflation expectations, which currently weigh on gold prices.
- Semiconductors: Strong gains, led by SMIC, which surged nearly 5%.
- Banks: Broadly higher, with China Merchants Bank rising over 3% after issuing a profit alert.
Technical Analysis of Hong Kong Market
Market Recap
- Hang Seng Index: +0.23%, closing at 19,264.46
- Hang Seng Tech Index: +0.21%, closing at 4,361.32
- Hang Seng China Enterprises Index: +0.23%, closing at 7,003.39
A50 & China A-Share Market Overview
Mainland Chinese stocks saw choppy trading throughout the session, with broader indices declining. Total turnover across Shanghai and Shenzhen markets reached ¥820.82 billion, with nearly 3,300 stocks closing lower.
Sector Highlights
- Decliners: Fintech, CPO, high-speed copper interconnect, and lithography equipment led losses. Pharmaceutical stocks remained subdued.
- Gainers: Niche themes such as Xiaohongshu-related concepts and banks performed well, with additional strength in solar energy, tourism, TikTok concepts, and rare earths.
Technical Analysis of China Market
Market Recap
- Shanghai Composite: -0.25%, closing at 3,232.98
- Shenzhen Component: -0.78%, closing at 10,086.1
- ChiNext Index: -1.59%, closing at 2,042.85
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Disclaimer
This information contained in this blog is for general reference only and is not intended as investment advice, a recommendation, an offer, or an invitation to buy or sell any financial instruments. It does not consider any specific recipient’s investment objectives or financial situation. Past performance references are not reliable indicators of future performance. Doo Prime and its affiliates make no representations or warranties about the accuracy or completeness of this information and accept no liability for any losses or damages resulting from its use or from any investments made based on it.
The above strategies reflect only the analysts’ opinions and are for reference only. They should not be used or considered as the basis for any trading decisions or as an invitation to engage in any transaction. Doo Prime does not guarantee the accuracy or completeness of this report and assumes no responsibility for any losses resulting from the use of this report. Do not rely on this report to replace your independent judgment. The market is risky, and investments should be made with caution.
