26 Oct 2022

Last night, the three major U.S. stock indexes opened lower and moved higher, led by lidar, charging piles, new energy vehicles and WSB concept stocks. As of the close, the Dow rose 1.07%, the Nasdaq rose 2.25%, and the S&P rose 1.63%. The yield on the 10-year U.S. Treasury bond fell 3.322% to close at 4.104%, a difference of about -38 basis points compared with the yield on the two-year Treasury bond. Fear index VIX fell 4.66%. Brent crude closed down 0.37%. Spot gold closed up 0.21% at $1,653 an ounce. The dollar index remained high, closing at 110.88.

The U.S. S&P/CS20 major city house price index recorded an annual rate of 13.08% in August, the smallest increase since February 2021, lower than the 16.06% increase in the previous month. The housing market has slowed abruptly this year due to a rapid rise in mortgage rates, raising borrowing costs for homebuyers and driving many would-be buyers out of the market. Existing home sales fell for eight straight months through September. Year-on-year house price growth has slowed from a record of more than 20 per cent set in March, and economists expect house price growth to continue to slow this year. "We're back in a buyer's market because of the very rapid rate of housing inventory growth and slowing demand. If mortgage rates are above 6 per cent, there is no doubt that we will see continued downward correction in house prices."

The U.S. Richmond Fed manufacturing index recorded -10 in October, the lowest since May 2020. Supply chain conditions have shown little sign of easing since August, as indexes for supplier lead times and order backlogs have held steady, although both have improved significantly from earlier this year. The average growth rate of prices paid and prices received rose again in October after slowing in September; expectations for the next 12 months were also slightly higher than in September. Inflation remains a concern and continues to move higher. The employment index neither strengthened nor was zero for the second month in a row. The wage index fell from 40 to 34, but remained high.

German Deputy Chancellor and Economy Minister Habeck said EU member states agreed to jointly purchase natural gas. EU energy ministers will hold an emergency meeting on November 24. Natural gas prices in the U.S. Permian Basin fell to negative territory for the first time in two years. Russian President Vladimir Putin said decision-making on special military operations in Ukraine needed to be accelerated.

According to the British "Times": the new British Prime Minister Sunak will meet with the British Chancellor of the Exchequer Hunt to discuss proposals to increase taxes and reduce public spending. Traders reduced bets on a rate hike by the Bank of England, with the top rate expected to be below 5% by 2023. A Reuters poll showed 18 of 30 economists believed the Bank of England would raise interest rates by 75 basis points to 3.00% on Nov. 3, while 12 believed there would be a larger rate hike.

Apple rose 1.93%, officially allowing iOS programs to issue NFTs, but refusing to break the 30% fee tradition.

Microsoft rose 1.38%. Q1 revenue and net profit in fiscal year 2023 exceeded expectations. Due to the decrease in sales expectations, it fell more than 7% after the market.

Google rose 1.9%, Q3 revenue and net profit were less than expected, and the slowdown in the electronic advertising market had a greater impact; India's competition regulator said it would impose a fine of 9.36 billion rupees, or about $113 million, on Google, arguing that Google abused its market position to promote its Payment apps and in-app payment systems.

Amazon rose 0.65%, and Paypal rose 7.11% after partnering with Paypal's mobile payment service Venmo to launch a new secure payment method for the holiday season.

Tesla rose 5.29% as Musk told banks that it plans to close its acquisition of Twitter on Friday;

Twitter rose 2.45%, the White House denied reviewing Musk's Twitter acquisition; according to internal documents: the number of active Twitter users who log in 6-7 days a week and tweet 3-4 times a week is declining.

Sources from: Investing.com; Reuters.com

Louis Yap

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