U.S. markets ended mixed on Wednesday. The Dow slightly declined, while both the Nasdaq and S&P 500 rose for the third straight trading day.
Rising U.S. bond yields countered some of the positive effects from recent corporate earnings, with investors keenly watching the Federal Reserve’s decisions on interest rates.
Tesla’s shares surged over 12% following an announcement that the company would speed up the introduction of more affordable electric vehicles.
Despite this promising news, the tech giant failed to meet earnings and revenue expectations for the recent quarter.
Samy Chaar, Chief Economist at Lombard Odier, noted, “This week, attention is returning to market fundamentals and earnings reports. For the moment, we’re shifting away from the geopolitical factors that dominated market influences the previous two weeks.”
U.S. Stocks
Fundamental Analysis:
Major tech stocks varied in performance. Tesla notably surged over 12%, marking its largest single-day gain since January 2022, and its market value rebounded above $500 billion.
Apple rose over 1%, while Intel, Microsoft, and Google saw modest increases. Nvidia and Netflix fell over 3%, with Amazon declining over 1%.
HashiCorp jumped over 7% following reports that IBM is close to finalizing a deal to acquire the cloud software platform for about $35 per share, causing IBM’s stock to drop over 5% after hours.
Chinese concept stocks generally rose, with the Nasdaq Golden Dragon China Index up 1.96%.
Bilibili soared nearly 11%, iQIYI over 5%, Weibo over 4%, and Futu Holdings and NIO each over 3%.
Alibaba, JD.com, Manbang all climbed over 2%, with Tencent Music and NetEase up over 1%, and Baidu and Vipshop slightly higher. Li Auto fell over 5%, XPeng Motors over 1%, and Pinduoduo slightly declined.
Technical Analysis:
(S&P 500 Index, 1-day chart)
Market Trends:
- Nasdaq increased by 16.11 points or 0.10% to 15,712.7.
- Dow decreased by 42.77 points or 0.11% to 38,460.92.
- S&P 500 increased by 1.08 points or 0.02% to 5,071.63.
Hong Kong Stock Market
Fundamental Analysis:
Hong Kong stocks extended their gains for the third day in a row. The performance of tech stocks was mixed; Bilibili climbed nearly 4%, and Alibaba increased over 1%, while Meituan dropped nearly 2%, and Tencent fell over 1%.
The real estate trust sector saw significant growth, boosted by the inclusion of H-REITs in the Shanghai-Shenzhen-Hong Kong Stock Connect, with Country Garden soaring over 11%.
The major financial sector was notably active, with HKEX rising for the fourth consecutive day and insurance stock China Taiping gaining over 4%.
Semiconductor stocks also showed signs of recovery, with SMIC rising nearly 4%. In contrast, education stocks suffered a decline, with New Oriental plunging over 16%.
HKEX’s stock performance has been buoyed by a series of positive factors. Recent regulatory announcements aimed at bolstering Hong Kong’s capital market, along with better-than-expected Q1 financial results, have driven HKEX’s shares upwards.
The Q1 revenue reached HK$5.2 billion, slightly down year-over-year but surpassing market expectations of HK$4.97 billion. Net profit stood at HK$2.97 billion, down year-over-year but above the anticipated HK$2.81 billion, marking a 14% increase from the previous quarter.
Technical Analysis:
(Hang Seng Index, 1-day chart)
Market Trends:
- Hang Seng Index (HSI) up 0.55% to 17,295.93.
- Hang Seng Tech Index (HSTECH) down 0.06% to 3,571.59.
- Hang Seng China Enterprises Index (HSCEI.) up 0.47% to 6,129.01.
FTSE China A50 Index
Fundamental Analysis:
A-shares showed mixed performance in the morning session, with sectors like titanium dioxide and weight loss drugs leading gains.
In sector performance, military IT, chemical pharmaceuticals, heparin, and 3D cameras were among the top gainers, while sectors like MlOps, AI phones, digital reading, and electronic garages saw declines.
Technical Analysis:
(SSE Composite Index, 1-day chart)
Market Trends:
- Shanghai Composite Index (SHCOMP) up 0.17% to 3,049.9.
- Shenzhen Component Index (SZCOMP) up 0.41% to 9,289.37.
- ChiNext Index (CHINEXT) up 0.41% to 9,289.37.
- SSE Sci-Tech Innovation 50 Index down 0.21% to 737.09.
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