The three major U.S. stock indexes, which have hit record highs in recent days, paused their gains on Friday and all fell during the session. Blue-chip technology stocks weighed on the broader market, with most of the top seven technology giants falling during the session.
The media said Tesla's Shanghai factory was cutting production due to slow sales growth and fierce competition in the Chinese market. Tesla fell nearly 4% in early trading. Apple, which fell sharply after being sued by the U.S. Department of Justice for violating antitrust laws and facing the threat of spin-off of iPhone, its largest revenue source, rebounded slightly, but its weight in the S&P has fallen to its lowest point in nearly three years. Nvidia broke out of its decline at the beginning of the session. Since the opening of the GTC conference where the most powerful AI chip Blackwell was launched, it has maintained its upward trend this week and set a record for its longest consecutive rise. This year, it has only fallen in the first week of the new year. Micron Technology, whose financial report highlighted strong demand for artificial intelligence (AI) servers, failed to extend Thursday's more than 10% surge and fell more than 2% before turning higher on Friday.
Poor quarterly reports from some companies curbed the market's gains. After announcing that sales in China were still growing slowly in the fourth quarter and that first-quarter revenue guidance was only slightly higher than analysts expected, sportswear giant Nike once fell 9%, leading the decline in the Dow components. However, in a week when major central banks such as the Federal Reserve issued dovish signals, major stock indexes rose throughout the week, with the Dow recording its best weekly performance in three months. Pan-European stock indexes also continued to rise as expectations for central bank interest rate cuts increased, setting a record for their longest weekly rise in more than ten years.
The Federal Reserve maintained its expectations of three interest rate cuts this year. After the meeting, Fed Chairman Powell said that recent inflation data have warmed up more than expected, but inflation will still gradually decline on a bumpy road. Expectations of the Federal Reserve starting to cut interest rates in the middle of the year have strengthened, and U.S. Treasury bond prices have rebounded. U.S. Treasury yields, which soared after last week's CPI and PPI announcement exceeded expectations, fell back. The interest rate-sensitive two-year U.S. Treasury yield fell more than 10 basis points for the whole week. The benchmark 10-year U.S. Treasury yield fell from a record high on Monday. It also fell more than 10 basis points from its three-week high.
The U.S. dollar index hit a one-month high on Friday, falling only on Wednesday, the day the Federal Reserve announced its decision. The unexpected interest rate cut by the Swiss National Bank triggered the decline of many non-US currencies and the strengthening of the US dollar. Analysts believe that the SNB's action shows that inflation is under control, other central banks will soon adopt easing policies, and the dollar's advantage against the backdrop of strong U.S. economic growth has once again emerged.
Non-US currencies generally fell. The Bank of England kept interest rates unchanged and two hawkish voting committee members gave up their support for raising interest rates. The pound fell 1% on Thursday and then fell further to a one-month low. The Bank of Japan removed negative interest rates and YCC policies, but the prospects for future interest rate increases are unclear. The yen hit a four-month low after the central bank meeting. Cryptocurrencies have corrected this week. Bitcoin, which hit record highs last week, hit another two-week low on Monday. It fell below $61,000 on Wednesday, far away from the record high of nearly $74,000 last week, and is on track to post its largest weekly decline in half a year.
The S&P surged to a thrilling turn and may hit record highs for four consecutive days. NVIDIA will rise for 11 consecutive weeks. The pan-European stock index has its longest weekly rise since 2012.
The three major U.S. stock indexes opened with slight fluctuations, all fell at the beginning of the session, and the losses narrowed at midday. The Dow Jones Industrial Average, which opened slightly lower, fell nearly 240 points, or about 0.6%, at the beginning of midday, before the decline narrowed to less than 200 points. The S&P 500 opened slightly higher, falling more than 0.2% when it hit its daily low in early trading, before turning slightly higher at midday. The Nasdaq Composite Index, which opened lower, fell more than 0.2% at the beginning of the session, turned higher at the end of the morning, and rose nearly 0.4% at midday.
If gains hold, the Nasdaq and S&P will close higher for five consecutive trading days. The S&P will hit a record closing high for four consecutive days and the 21st this year. The Nasdaq is set to hit record highs for three consecutive days. The Dow Jones Industrial Average, which has risen for four consecutive days, will fall to its closing record high set for two consecutive days.
The Russell 2000, a small-cap stock index dominated by value stocks, fell nearly 1% in midday trading, retreating after rising for three consecutive days to its highest level since April 2022. The Nasdaq 100 index, which is heavy on technology stocks, turned positive at midday, rising less than 0.4%. It will rise for five consecutive days and set a new closing record for two consecutive days. The Nasdaq Technology Market Capitalization Weighted Index (NDXTMC), which measures the performance of technology stocks in the Nasdaq 100 index, rose about 1% at midday and will rise for the fifth consecutive day and hit a record high.
The major stock indexes will rise collectively this week. The S&P, Nasdaq, and Nasdaq 100, which have fallen for two consecutive weeks, will rebound and register gains for the eighth week in the first 12 weeks of 2024. The Dow Jones Industrial Average, which has fallen for three consecutive weeks, and the Russell 2000, which has stopped rising for two consecutive weeks last week, will also rebound. The Dow Jones Industrial Average will have its largest weekly gain since the week of December 15, 2023.
Including Microsoft, Apple, Nvidia, Google parent company Alphabet, Amazon, Facebook parent company Meta, and Tesla, most of the seven major technology stocks fell in early trading, but most rose by midday. After the media reported that Tesla's Shanghai factory was cutting production, Tesla fell nearly 3.8% at the beginning of the session, then narrowed its losses and fell less than 2% at midday.
Among the six major technology stocks of FAANMG, Apple, which fell more than 4% on Thursday, the largest decline in seven months, fell nearly 0.8% at the beginning of the session, turned higher in early trading, and rose less than 1% at midday; Alphabet, which turned lower on Thursday, opened higher and maintained As for the gains, it rose by more than 2% at midday; Amazon, which fell nearly 0.8% at the beginning of the session, rose by less than 1% at midday; Netflix, which opened higher, rose by less than 1%. Meta turned slightly higher at midday, and Microsoft, which turned down at the beginning of the session, turned slightly higher at midday.
Chip stocks overall turned higher midday, with the Philadelphia Semiconductor Index and the semiconductor industry ETF SOXX turning higher at midday, up less than 1%. They are expected to rise for three consecutive days and set a new closing high since March 12 in two days. NVIDIA, which opened low, turned positive at the beginning of the trading session, rising by more than 1% in early trading. It is expected to rise for five consecutive days, rising for 11 consecutive weeks, setting another record for the longest consecutive weekly rise; AMD, which had fallen by more than 1% in early trading, turned positive at midday. It will rebound after falling for four consecutive days to the lowest level since February 28; Micron Technology, which rose 14% on Thursday after announcing its financial report, fell more than 2.5% in early trading and rose more than 1% after turning higher at midday.
Popular Chinese concept stocks generally continued to fall. The Nasdaq Golden Dragon China Index (HXC) fell nearly 2% in early trading and will fall for two consecutive days to its lowest closing level since March 8. Among individual stocks, Xpeng Motors fell 9% in early trading. After Alibaba's affiliated company reduced its holdings of 33 million U.S. stocks on Wednesday and cashed out approximately US$314 million, the decline accelerated. Li Auto once fell more than 3%, and NIO fell more than 2%. , Alibaba and JD.com fell by more than 2%, NetEase and Bilibili fell by more than 1%; and after the media said that Apple discussed using Baidu’s AI technology in China’s iPhone and other devices, Baidu rose by nearly 4% in early trading. Less than 1%, Pinduoduo rose more than 2% in early trading, and Tencent’s pink orders turned slightly higher.
Among the stocks that released financial reports, FedEx (FDX), whose third-quarter profit was higher than expected and will repurchase US$5 billion in shares, rose 10% at the beginning and about 7% at midday; while sales in China increased in the fourth quarter. Nike (NKE), which is slow and has lower-than-expected revenue growth guidance for the first quarter, fell 9% in early trading and fell less than 6% at midday, leading the decline in the Dow components; U.S. sales were sluggish in the fourth quarter and overall sales guidance for the first quarter was lower than expected. Clothing brand Lululemon (LULU) fell nearly 20% in early trading.
Among the more volatile stocks, Reddit (RDDT), the "American Tieba" with a large concentration of retail investors, fell 10.1% in early trading, and the decline narrowed to less than 3% in midday. It closed up nearly 50% on Thursday, its first day of listing, and then fell back; in shareholders Digital World Acquisition, a blank check company, rose more than 12% in early trading after voting to approve the merger with Trump Media & Technology Group (TMTG), the parent company of Trump's social media Truth Social. TMTG may be listed under the symbol DJT next week. Corp. (DWAC) fell more than 12% in early trading and fell less than 5% in midday trading.
Pan-European stock index gains pared. The European Stoxx 600 index closed slightly lower, roughly stabilizing the closing record high set on Thursday. Most stock indexes in major European countries continued to rise. The German, Italian and Spanish stock indexes rose for four consecutive days, setting new closing records for four consecutive days. British stocks rose for two days in a row, reaching a new high in a year. French stocks, dragged down by luxury goods stocks, fell back after a slight rebound on Thursday and failed to get close to the closing record high set by Tuesday's rebound.
Among various sectors, the defensive sector Utilities rose nearly 1.1% to lead the gains, interest rate-sensitive real estate rose nearly 0.8%, while Technology fell 0.8% and led the decline. Following the decline in the Chinese stock market, the sector of personal and household goods, where luxury goods giants are located, fell more than 1%. 0.7%. Among constituent stocks, LVMH fell 2.3% and Kering fell 1.8%. Among individual stocks, affected by Nike's performance, London-listed JD Sports fell 6.3%; and after announcing that it is expected to pay dividends and buybacks in 2024 to exceed 6 billion euros, Santander, the second-largest bank in the euro zone by market capitalization, rose by nearly 2.1% %, supporting the Spanish stock index to lead the gains among countries.
The Stoxx 600 index rose by about 1% this week, rising for nine consecutive weeks, the longest consecutive week of gains since 2012. Most stock indexes in various countries have been rising, with Italian stocks, German stocks, Spanish stocks and British stocks rising for eight, seven, three and two weeks in a row respectively, while French stocks, which had risen for two weeks in a row, fell back. Among various sectors, real estate, which fell by more than 3% last week, led the way with a cumulative increase of more than 5% this week. Retail, which rose by more than 4% last week, led the increase by nearly 3%. Technology, which fell by 3.5% last week and led the decline, rose by more than 2%. Basic resources and oil and gas, where banks and mining stocks are located, all rose by more than 2%; while personal and household supplies fell by 2.5%, becoming the culprit of the French stocks' cumulative decline.
London nickel fell to a new low in nearly four weeks, and London copper fell back, ending its five-week and two-week rise respectively.
Most London base metal futures fell on Friday, with Lun Nickel, which led the decline, falling nearly 2%, falling back to its lowest level in nearly four weeks. Lun Zinc and Lun Zinc both stopped rising for two consecutive days, and Lun Zinc hit a new low in more than two weeks. Lunxi, which just got off the four-week low on Thursday, also fell back. Lun Copper fell back to its lowest level in more than a week, closing lower for the third day this week. London lead fell for the third consecutive time to a three-week low since March 1. Lun Aluminum has risen for three consecutive times, continuing to hit a new high since early January.
Most basic metals fell this week. Lunni, which led the decline, fell by more than 4.6%, and Lunzinc, which fell by 3%, both fell back after rising for five consecutive weeks. Lunxi, which rose for three consecutive weeks, fell by more than 3%. Lun lead fell by more than 4% in two weeks, and Lun copper fell for the whole week due to Friday's decline, falling by more than 2% and failing to rise for three consecutive weeks, while Lun lead rose by more than 1.5%, rising for two consecutive weeks.