On Thursday, U.S. stocks closed lower, influenced by rising U.S. bond yields that exerted pressure on stock indices.  

The unexpectedly high September Consumer Price Index (CPI) in the U.S. raised concerns about the Federal Reserve potentially raising interest rates again this year and maintaining high-interest rate policies for an extended period. 

In September, the U.S. CPI surged by 3.7% year-on-year, surpassing the expected 3.6% and matching the previous reading of 3.7%. The core CPI for September grew by 4.1% year-on-year, marking the lowest rate since 2021, aligning with expectations and a decrease from the previous reading of 4.3%. 

While these figures show that U.S. inflation has moderated from its peak, it remains distant from the Fed’s 2% target. This possibility may encourage the Federal Reserve to maintain high-interest rates for an extended period. 

U.S. Stocks 

Fundamental Analysis: 

Major tech stocks, including Google, Tesla, and Meta, experienced declines exceeding 1%. 

Leading the decliners were companies in the electric vehicle charging, coal, and non-ferrous metals sectors, with ChargePoint plunging by over 5%.  

Companies like US Aluminum Corporation, Newco Steel, Blink Charging, and EVgo saw drops of over 4%. 

Gains were observed in the lithium battery, semiconductor equipment, and digital music sectors, with ConTech Technology and Livent surging by over 4%.  

Other companies, including Broadcom, KLA, American Axle, and Chilean Mining Chemicals, saw increases of over 3%, while Sony gained over 1%. 

Banking stocks encountered a collective decline, with Morgan Stanley and Goldman Sachs witnessing drops exceeding 1%.  

Bank of America and JPMorgan Chase saw minor decreases, whereas Wells Fargo experienced a slight increase.  

Novo Nordisk gained over 1%, reaching a historic high following preliminary signs suggesting that its drug, Ozempic, is effective in treating kidney failure in diabetic patients. 

Popular Chinese Concept Stocks led the decliners, with the Nasdaq China Golden Dragon Index falling by over 3%.  

JD.com saw a decrease of over 8%, while TAL Education experienced a drop of over 7%.  

Companies like NIO, Weibo, iQiyi, Bilibili, Vipshop, and XPeng Motors witnessed declines exceeding 4%.  

Futu Holdings, Alibaba, Pinduoduo, Li Auto, and Manbang Group faced drops of over 2%, while Netease and Tencent Music decreased by over 1%. 

Technical Analysis:   

(S&P 500 Index, 1-day chart) 

Market Trends: 

• Dow Jones Industrial Average dropped 173.73 points, representing a 0.51% decline, closing at 33,631.14. 
• Nasdaq Composite Index (Nasdaq) fell 85.46 points, marking a 0.63% decline and closing at 13,574.22. 
• S&P 500 Index decreased 27.34 points, indicating a 0.62% decline and closing at 4,349.61. 

Hong Kong Stocks 

In the Hong Kong stock market, the three major indices opened lower and continued to decline.  

Core technology stocks experienced a collective slump, with JD Group dropping by over 12%, Bilibili falling by nearly 6%, Baidu Group declining by over 5%, and Meituan falling by nearly 4%.  

Real estate stocks mostly declined, with Longfor Group falling by over 3%. Automotive stocks also saw declines, with NIO dropping by over 4%.  

The travel sector led the decliners, with China International Travel Service falling by over 4%. 

Core technology stocks collectively dropped, with JD Group slumping by over 3%. Several major banks downgraded JD Group’s ratings. Macquarie lowered JD Group’s Hong Kong stock rating to neutral with a target price of HKD 124.  

They also downgraded JD Group’s American Depositary Receipt (ADR) rating to neutral with a target price of $32. Morgan Stanley downgraded JD Group’s ADR rating to equal-weight with a target price of $33. 

In addition, Nomura released a report projecting JD-SW’s third-quarter revenue to grow year-on-year by 1% to CNY 46 billion.  

This falls at the lower end of its guidance and is 3% below market expectations of CNY 25.4 billion.  

They estimated non-GAAP earnings per share to drop by 4% to CNY 6.01 and a net profit margin of 3.9%, aligning with the bank’s expectations. 

Technical Analysis:   

(Hang Seng Index, 1-day chart) 

Market Trends: 

• Hang Seng Index (HSI) dropped by 2.11%, closing at 17,852.85. 
• Hang Seng Tech Index (HSTECH) fell by 3.15%, closing at 4,017.49. 
• Hang Seng China Enterprises Index (HSCEI) decreased by 2.1%, closing at 6,267.73. 

FTSE China A50 Index 

Fundamental Analysis: 

On the morning of October 13th, A-share indices in China opened lower. 

The Shanghai Composite Index (SHCI) briefly dipped before entering a sideways trend, while the Shenzhen Component Index (SZCI) and the ChiNext Index (CHINEXT) continued to weaken, with declines exceeding 1%. The ChiNext Index once again fell below 2,000 points. 

Industry sectors were mixed, with optical electronics, pharmaceuticals, medical services, consumer electronics, and communication equipment witnessing notable gains.  

Conversely, photovoltaic equipment, the liquor industry, batteries, energy metals, and the tourism and hotel sector faced significant declines.  

Among thematic concepts, weight-loss drugs, 6G, hepatitis, CRO, laser radar, and satellite communication remained active. 

Technical Analysis: 

(SSE Composite Index, 1-day chart) 

Market Trends: 

• Shanghai Composite Index (SHCOMP) dropped 0.64%, closing at 3,087.97. 
• Shenzhen Component Index (SZCOMP) fell 1.21%, closing at 10,045.52. 
• ChiNext Index (CHINEXT) declined by 1.51%, closing at 1,988.66. 
• SSE STAR Market 50 Index (SSE50) dropped 0.99%, closing at 891.08. 

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