The New York Stock Exchange is facing a critical moment. An employment report is also released as the US Federal Reserve opens its FOMC to discuss tapering. As a result, the Nasdaq Dow is expected to fluctuate in the New York Stock Exchange. International oil prices, government bond yields and the dollar exchange rate are also closely watching the tapering and employment reports. Cryptocurrencies such as Bitcoin are on a downward trend.
According to the New York Stock Exchange on the 1st, the Fed is expected to hold its FOMC meeting on the 3rd and announce a tapering of asset purchases. Fed members had expected the tapering to begin in November or December and finish by mid-next year. The official announcement will be made early in the morning of the 4th Korean time. Fed Chairman Jerome Powell is expected to emphasize that the tapering does not automatically raise interest rates after the tapering ends so as not to cause market unrest. Rate hikes could be pushed further, as inflation indicators suggest that inflation may not be as temporary as the Fed judges. Last weekend, the personal consumption expenditure (PCE) price index, which the Fed uses as the central benchmark for monetary policy, rose 4.4% over the same period last year. The core PCE price index also rose 3.6% to a new high in 30 years. The Labor Ministry’s October employment report, which will be released soon, is also noteworthy. New York Stock Exchange estimates that the number of nonfarm payrolls increased by 450,000 in October. This is twice as many as 194,000 in September. The unemployment rate is projected to fall from 4.8% to 4.7%. Hourly wages in the United States are expected to rise 4.9% over the same period last year.
In the New York Stock Exchange, Pfizer and Moderna are reporting earnings this week. Last week, the Dow Jones Industrial Average rose 0.40% on a weekly basis. The S&P 500 and Nasdaq rose 1.33% and 2.70%, respectively. The three major New York stock indexes rose for the fourth week in a row. Last week it closed at an all-time high.
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November 1 = Markit Manufacturing PMI, October Supply Management Association (ISM) Manufacturing PMI, ON Semiconductor, NXP Semiconductors earnings
November 2 = Economic optimism index, automobile sales, Federal Open Market Committee (FOMC) regular meeting begins Pfizer, BP, DuPont, ConocoPhillips, T-Mobile, Zillow earnings announcement
November 3 = ADP Employment Report, Markit Services PMI, ISM Non-Manufacturing PMI, Factory Reorders, FOMC Base Rate Decision, Fed Chairman Jerome Powell Press Conference, Qualcomm, CVS Health, MGM Resorts, Win Resort earnings announcement
November 4 = Challenger Reduction Report, Productivity/Unit Labor Cost (Reserve), Weekly New Unemployment Insurance Claimants, Trade Balance AIG, Moderna, Uber, Peloton, Square Performance
November 5 = New employment and unemployment rate in the non-agricultural sector, Esther George, President of the Federal Reserve Bank of Kansas City (Fed), Consumer Credit, Draft Kings, and AMC Network Performance
Last weekend, the three major indices of the New York Stock Exchange set record highs. The Dow Jones Industrial Average of the New York Stock Exchange finished trading at 35,819.56, up 89.08 points (0.25%) from the previous day. The Standard & Poor’s 500 Index rose 8.96 points (0.19%) to close at 4,605.38, and the tech stock Nasdaq Index rose 50.27 points (0.33%) to close at 15,498.39. All three major New York stock indices broke record highs. In October, the New York Stock Exchange rose 5.8% for the Dow, 6.9% for the S&P 500, and 7.3% for the Nasdaq. The Nasdaq Index recorded the largest monthly increase in 11 months since November last year.
Apple and Amazon’s third-quarter earnings, announced after the close, fell short of expectations. On the other hand, Microsoft rose 2.2% to a market capitalization of $2.4 trillion, beating Apple, which fell 1.8%, to reclaim its position as the most expensive publicly traded company in the United States. Nike, Intel, and Chevron led the stock market with gains of more than 1%. President Biden cut the social welfare budget to $1.75 trillion, which was half of the original plan, to increase the chances of passing Congress. Treasury Secretary Janet Yellen predicted in an interview that the infrastructure budget package would soon be passed by Congress.
In November, the Korean stock market KOSPI and KOSDAQ are expected to be affected by the US’ reduced asset purchase program (tapering) and the Bank of Korea’s second rate hike, amid continued inflation concerns. During the month of October, the KOSPI fell 3.20% to 2970.68. The monthly decline continued for four consecutive months from July. The fall of Samsung Electronics and SK Hynix led the KOSPI correction. This is because semiconductor prices are expected to fall. Samsung Electronics broke the 70,000 won line. Foreigners net sold 3.884.2 trillion won worth of stocks on the KOSPI. On the other hand, individuals and institutions bought 2.83 trillion won and 737.6 billion won, respectively.
The U.S. central bank, the Federal Reserve, is likely to officially declare tapering at the FOMC in November. This means that the current monthly purchases of $80 billion in Treasury bonds and $40 billion in mortgage-backed securities (MBS) by the Fed will decrease. As for the tapering implementation method, it is being discussed that the purchase size will be reduced by a total of 15 billion dollars every month starting immediately next month, ▲ starting early next year and reducing the purchase size by a total of 20 billion dollars every month. The impact could also hit the KOSPI and KOSDAQ. Immediately after the tapering schedule is formalized, volatility may increase temporarily. Following the FOMC, the US October employment report on November 5, the producer and consumer price indexes on the 9th and 10th, and the Bank of Korea financial currency to be held on the 25th Attention is being paid to the committee’s decision on the base rate. KB Securities suggested 2870-3140 as the expected band for next month’s KOSPI and advised that it is necessary to focus more on industry strategy. Judging that this is the beginning of a rebound after a four-month correction, some suggested that the proportion of stocks be increased.
The KOSPI fell for the third day in a row, sinking to the 2,970 level. On the 29th, the KOSPI closed at 2,970.68, down 38.87 points (1.29%). Samsung[005930](-1.27%), SK hynix[000660](-3.29%) and other major semiconductor stocks fell, pulling the index down.
Celltrion[068270](-6.96%), SK Bioscience[302440](-6.31%) and others plummeted. It appears that the government is being affected by the news that three companies, including Merck & Company (MSD), will pre-purchase oral treatment for COVID-19. Hyundai Mobis showing sluggish performance[012330]fell 4.36%. The KOSDAQ index closed at 992.33, down 7.80 points (0.78%). Celltrion Healthcare[091990](-7.33%), Celltrion Pharmaceuticals[068760](-5.82%) and others plummeted. Wemade[112040]surged 14.18%.
Following Dogecoin, a cryptocurrency that has fluctuated rapidly due to tweets from Tesla CEO Elon Musk, Shibanu Coin’s ‘money game’ is drawing the industry’s attention. Shibainu, a Dogecoin subtype, is also showing a hopping pattern that fluctuates rapidly. Shivanu, which was one of the altcoins (virtual currencies excluding Bitcoin), is currently the 21st largest cryptocurrency by market capitalization. Shibainu is a blockchain-based cryptocurrency created by imitation of Dogecoin last year. After the Dogecoin mascot ‘Shiba-gyeon’, the coin was named ‘Shibainu (犬)’.
The market price skyrocketed as a coin named after the popular idol group BTS’ fan club ‘Army’ was listed on a foreign virtual asset exchange. BTS’ agency and fandom came out to protest. Singapore-based virtual asset exchange Bitget listed ‘ARMY’ in the ‘Innovation Zone’ of the exchange at 17:00 on the 27th. The coin, listed as an ARMY/USDT pair, showed a sharp fluctuation immediately after listing, and took the first place in trading volume on the exchange. The developer of Amicoin claims that the purpose of issuing the coin is ‘pure dedication to maximizing the profits of BTS’. It is said that it was issued to support BTS members so that they do not worry about anything other than their work for the rest of their lives. According to the Amicoin white paper, the developer, as a BTS fan, has consumed a lot of BTS-related official goods, but as the holding funds have been exhausted, it has become difficult to purchase continuously. He explained the background of issuance by issuing ARMY tokens directly with the intention of being the last challenge as a developer to take care of BTS for the rest of their lives. As the size of the BTS fandom reaches at least 50 million Koreans, the transaction volume will be huge.
10 billion of Amicoins were issued based on the Ethereum ERC-20 network. The developer claims to have designed the wallet so that 50% of the total USDT secured through Amikoin transactions goes directly to BTS. BTS’ agency Hive and fan club ARMY both have negative views on the coin, so it’s unclear whether actual profits will be delivered. In this regard, Hive said, “It has nothing to do with this cryptocurrency, and it was issued without any discussion with us. Also, the portrait of BTS used to promote the cryptocurrency is not subject to any discussion with Big Hit Music, the agency. It happened without it,” he explained. Hive further warned, “We are checking for legal violations, including the infringing of an artist’s portrait right without consulting with the agency, and we will take all legal action against infringements and violations.” BTS photos used in publicity were replaced due to copyright violations. However, it seems difficult to fundamentally restrict the issuance and distribution of Amicoin. There are not many cases like ‘Dogecoin’ based on internet memes, and BTS fan club ‘ARMY’ is a common noun meaning the military, so there is no justification to stop its use. Bitget exchange, which listed Amicoin, has not canceled its listing or stopped trading even after receiving an official notice from Hive.
Daeho Kim, Director, Global Economic Research Institute tiger8280@g-enews.com
[알림] This article is for investment judgment reference only, and we are not responsible for any investment loss based on it.
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