The US core personal consumption expenditure (PCE) price index in August, along with the Fed’s “second-in-order” Brainard hawk, accelerated support for continued interest rate hikes to reduce inflation and avoid premature rate cuts, causing for the US stock market to open. lower on Friday (30th) after concerns over a sharp interest rate rise pressured consumer spending to rebound.

At the time of writing, the Dow Jones Industrial Average was down nearly 0.1%, the Nasdaq Composite was up nearly 0.3%, the S&P 500 was up 0.1%, and the Philadelphia Semiconductor Index was down 0.2%.

The US Commerce Department released data showing that the Fed’s preferred inflation indicator, the PCE core price index, accelerated faster than expected in August, while personal spending rose in August, indicating household economic resilience American, which could allow the Fed to stay. aggressive rate hike path.

Data shows that US PCE increased by 6.2% in August, higher than the expected 6%, the previous value was revised up to 6.4%, and the monthly growth rate was 0.3%, higher than r 0.1% expected, and the previous value was -0.1%.

Core PCE rose 4.9% yoy in August, above market expectations of 4.7%, the biggest increase since April this year, and monthly growth of 0.6%, also above the 0.5% expected. In addition, personal expenditure rose 0.4% in August, higher than the 0.2% expected, and the previous value was revised down to -0.2%.

Meanwhile, Fed “second-in-command” Branard reinforced market expectations for a rate hike in a hawkish speech later in the day, arguing that to reduce inflation, interest rates need to stay high for a while and avoid premature rate cuts.

In currencies, the pound fell again on news that the British Treasury had not asked its fiscal watchdog to accelerate economic forecasts, a sign that the government has no plans to roll back a market-disrupting economic strategy.

In Europe, the euro zone inflation rate rose to a record high of 10% in September, beating market expectations of 9.7%, and the European Central Bank (ECB) is under pressure to raise interest rates sharply again in October.

In terms of geopolitics, Russian President Vladimir Putin announced in the Kremlin today that the territory of the four Ukrainian states occupied by the Russian army has been officially incorporated into the territory, saying that Russia has four new regions. However, Western countries, including the United States, do not recognize this result.

From Friday (30th) at 21:00 Taipei time:
S&P 500 daily chart. (Image source: Juheng.com)
Stocks covered:

Nike (NKE-US) fell 11.95% in early trade to $83.94 a share

Nike, a major sporting goods manufacturer, saw a sharp drop in profits of more than 20% last quarter, and its gross profit margin was not as good as market estimates, reflecting skyrocketing costs and discounts and promotions in North America to clear inventory, profits were hurt Top management revised down the gross profit forecast for the full year Shares were down nearly 12% in pre-market trading.

Micron ( MU-US ) rose 0.38% to $50.20 a share in early trade

Japan’s Ministry of Economy, Trade and Industry said today that Japan will subsidize US-based Micron 46.5 billion yen (about NT$10.2 billion) to produce advanced memory chips at its factory in Hiroshima.

In addition, Micron’s last quarter financial report and financial forecast failed to meet market expectations, highlighting that the chip market is even more sluggish. Micron plans to cut capital spending by at least 30 percent this fiscal year and reduce spending on wafer equipment by 50 percent, amid ongoing concerns that the poor economic outlook could drag on demand for end device equipment.

Amazon ( AMZN-US ) fell 1.03% to $113.62 a share in early trade

Amazon on Friday launched a live video feature to promote products on its Indian shopping platform, using a practice already popular in China to boost sales in Asia’s third-largest economy. The company has partnered with social media influencers for live broadcasts where they can interact with customers and offer limited time offers.

Today’s key economic data:
  • The US personal expenditure monthly growth rate in August was 0.4%, 0.2% was expected, and the previous value was -0.2%
  • The monthly growth rate of personal income in the United States in August was 0.3%, expected to be 0.3%, and a previous value of 0.3%
  • The US PCE price index in August reported an annual growth rate of 6.2%, expected 6%, and a previous value of 6.4%
  • The US core PCE price index in August reported an annual growth rate of 4.9%, expected 4.7%, and a previous value of 4.7%
  • The US core PCE price index in August reported a monthly growth rate of 0.6%, expected 0.5%, and a previous value of 0.1%
  • US September Chicago PMI reported 45.7, expected 51.8, previous value of 52.2
  • The final value of the US Michigan consumer confidence index in September is expected to be 59.5, the previous value was 59.5
Wall Street Analysis:

Seema Shah, chief global strategist at Major Global Investors, said that although overall inflation in Europe may be at its highest, the situation remains very worrying. He further explained that as the labor market remains tight and inflation becomes more entrenched in the eurozone economy, today’s data will only encourage the ECB to focus solely on inflation, giving them the green light launched another massive policy rate hike — even as the economy plunged headlong into a harsh winter and recession.

In addition, the euro area faces a particularly difficult situation due to its supply side, the ECB is largely unable to control inflation, and raising policy rates will only deepen economic weakness in the region.

In the United Kingdom, analysts at ING said that the situation in the United Kingdom symbolized the risk that this macro environment of stagnant inflation would turn into a financial crisis for the first time, but fortunately, the Kingdom intervened United actively in the temporary bond market crisis. . But with volatility back to 2020 highs, there will be no room for relaxation this fall.


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