US stocks closed lower on Tuesday. Rising tensions in the Middle East pushed oil prices higher. Meanwhile, US job openings unexpectedly rebounded, and manufacturing PMI remained sluggish.
This week, investors are focused on key economic data, particularly the September non-farm payrolls report, to gauge the Federal Reserve’s future interest rate moves.
On Monday, both the S&P 500 and Dow Jones hit record-high closing levels after Fed Chair Jerome Powell stated that the central bank has “no preset course” for future rate decisions. He added that if the economy performs as expected, two more rate cuts of 25 basis points each could occur this year.
David Chao, a strategist at Invesco, commented: “I still believe that with the macroeconomic backdrop showing more resilience than previously expected, global risk assets should perform well through the end of the year.
As a result, the current market narrative has shifted from concerns about a US economic slowdown to the pace and scale of rate cuts by the Fed this year.”
US Stocks
Fundamental Analysis:
Major tech stocks saw broad declines, with Nvidia dropping over 3%, while Apple and Microsoft fell more than 2%. Amazon also edged lower.
The semiconductor and consumer electronics sectors led the losses, with Navitas Semiconductor plunging over 6%, GlobalFoundries and Arm down more than 4%, and Intel, Micron Technology, and NXP falling over 3%. AMD, Qualcomm, Broadcom, and KLA Corp slipped more than 2%.
In contrast, precious metals and energy stocks surged. US Energy Corp soared over 13%, while Harmony Gold and Kinross Gold both rose more than 6%. Apache Corporation gained over 4%, and Occidental Petroleum and ConocoPhillips were up more than 3%.
Chinese stocks posted significant gains, with the Nasdaq Golden Dragon China Index soaring 5.48%. Beike Holdings jumped over 17%, Bilibili surged more than 14%, Li Auto gained over 11%, Pinduoduo climbed over 8%, JD.com rose more than 7%, and Alibaba advanced over 6%.
Other major Chinese companies also rallied, with Tencent Music, iQIYI, Trip.com, XPeng, and NIO all rising more than 5%, Baidu up over 4%, and NetEase increasing more than 3%.
Technical Analysis:
Market Trends:
- Dow Jones: Down 173.18 points, or 0.41%, at 42,156.97
- Nasdaq: Down 278.81 points, or 1.53%, at 17,910.36
- S&P 500: Down 53.73 points, or 0.93%, at 5,708.75
Hong Kong Stock Market
Fundamental Analysis:
Hong Kong stocks skyrocketed across the board. Mainland Chinese brokerage stocks led the gains, with Shenwan Hongyuan Hong Kong soaring over 134%, and China Merchants Securities surging more than 60%.
Property stocks extended their rally, with Shimao Group up over 87% and Agile Group climbing more than 74%. The auto sector was also active, with Li Auto gaining over 12% and BYD rising more than 6%.
Tech stocks were strong as well, with Bilibili soaring more than 19% and Meituan rising over 14%. Li Auto surged over 12%, and BYD rose more than 6%.
On October 1, several automakers released their September delivery data. BYD reported sales of 419,426 vehicles in September, up 45.9% year-over-year. Li Auto delivered 53,709 vehicles in September, marking a 48.9% increase from the same period last year and setting a new delivery record.
Technical Analysis:
Market Trends:
- Hang Seng Index: Up 6.00%, closing at 22,401.74
- Hang Seng Tech Index: Up 8.72%, closing at 5,166.09
- Hang Seng China Enterprises Index: Up 7.21%, closing at 8,051.39
FTSE China A50 Index
The Chinese mainland stock market (A-shares) is closed from October 1 to October 7 for the National Day holiday and will resume trading on Tuesday, October 8.
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