23 Nov 2022

Last night, the three major U.S. stock indexes fluctuated higher, all up more than 1%, and most of the star technology stocks closed up. As of the close, the Dow rose 1.18%, the Nasdaq rose 1.36%, and the S&P rose 1.36%. The U.S. 10-year Treasury yield fell 1.906% to close at 3.758%. Compared with the two-year Treasury yield difference of -77 basis points, the U.S. 2-year and 10-year Treasury yield curves have set a new record for inversion. The panic index VIX fell 4.79%. Brent crude oil settled up 0.49%. Spot gold closed up 0.11% at $1,740.18 an ounce. The U.S. dollar index remained high, closing at 107.17.

The OECD predicts that the global economic growth rate will slow down from 3.1% in 2022 to 2.2% in 2023. It is expected that the US economic growth rate will slow down from 1.8% in 2022 to 0.5% in 2023. Turnaround begins in mid-2023. The ECB completed a corporate bond-buying program worth 345 billion euros. ECB Governing Council member Holzmann said that based on current data, he would vote for a 75 basis point rate hike. Meanwhile, Chancellor of the Exchequer Hunt cut the maximum authorized size of the asset purchase facility to 871 billion pounds.

European gas futures rose 4% to above $1,280/km3 after Gazprom announced it may cut gas supplies via Ukraine (to Europe). German Deputy Chancellor and Economy Minister Habeck and French Finance Minister Bruno Le Maire expressed their determination to quickly implement joint gas purchases through long-term contracts to achieve lower prices for consumers and industry. The European Commission raised the benchmark gas price cap to €275/MWh (the European benchmark gas price is currently around €120/MWh), and the price cap proposal still needs to be approved by EU governments.

Kuwait, Iraq, and Algeria all denied reports that OPEC+ plans to increase production, and oil prices rose more than 3% intraday. Belarus asked Russia to increase oil transit fees by 39%, Rosneft said. US energy security envoy Hochstein said that the current oil price is still slightly higher than it should be, and will look for opportunities in the Strategic Petroleum Reserve (SPR). When the oil price is in the range of 70 US dollars per barrel, it will seek to buy back oil immediately. According to the Wall Street Journal: The Group of Seven and the European Union are discussing setting a ceiling on oil prices to Russia at around $60 a barrel. The draft of the EU's oil price cap plan for Russia shows that the EU will relax restrictions, increase the grace period and relax shipping terms before the Russian oil price cap plan is approved.

Morgan Stanley Wealth Management said U.S. federal funds rate futures imply that terminal rates will peak near 5% around April or May next year, in line with core inflation expectations forecast by inflation swaps, which are priced at Bond buyers provided a cushion. Morgan Stanley holds a "dovish" view on terminal interest rates, and expects the federal funds terminal rate to be 4.625% in February next year.

Apple rose 1.47%, British regulators launched an investigation into cloud gaming, and the Apple-Google duopoly came under scrutiny.

Microsoft rose 1.23%. According to Goldman Sachs: Microsoft has surpassed Amazon to become the most popular choice for hedge funds.

Tesla rose 1.22%. It is said that the increase in Tesla's orders is still lower than expected after two promotions. The company will launch a new "price reduction method" before the end of the year to boost sales. In response, Tesla responded that the news was not true.

Meta rose 1.44%. It is rumored that the CEO of Meta, Zuckerberg, may step down next year. The spokesperson of Meta company denied the news.

Best Buy rose 12.78%, the largest single-day gain since March 2020. Q3 revenue, EPS, and same-store sales all exceeded expectations. At the same time, it raised its full-year revenue guidance and spent $1 billion on buybacks.

Zoom fell 3.87%, Q3 revenue growth slowed down, and lowered its full-year revenue guidance. Dell rose 6.77%, Q3 revenue fell 6%, of which infrastructure solutions revenue increased 12% year-on-year, and net profit plummeted 93% year-on-year.

TSMC rose 3.27%. According to reports, TSMC’s 3nm foundry price is as high as $20,000, and the price of the next-generation iPhone may rise again.

IBM rose 1.65%, suing Micro Focus (MFGP.N), accusing it of plagiarizing its Customer Information Control System Transaction Server (CICS TS) software and using it to create a competing Micro Focus Enterprise Suite.

Sources from: Investing.com; Reuters.com

Louis Yap

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