U.S. bond yields see inverted again, Dow Jones closed slightly in black | Anue Juheng-US Stocks

Wall Street’s growing concern about the imminent recession, US stocks opened lower on Tuesday (5th), the Dow Jones fell more than 600 points in early trading, the 2-year and 10-year US bond yields inverted, and New York crude oil prices fell below Energy stocks hit the $100 per barrel mark, and solar stocks also underperformed. Bank stocks were generally weak, but technology stocks turned the tide. The Nasdaq closed in the red by more than 1.7%, and the Dow Jones closed down nearly 130 points.

Investors returned to the market after the July 4th Independence Day holiday, but sentiment remained fragile, oscillating between recession fears and overinflation fears, Atlanta Fed GDPNow indicator projected for Q2 GDP growth will contract by 2.1%. Combined with a 1.6% decline in the first quarter, it met the technical definition of a recession. Two-year and 10-year U.S. Treasury yields inverted on Tuesday, deepening fears that the world’s largest economy is entering a recession.

With the U.S. economic outlook rapidly deteriorating, market traders expect the Fed to reverse monetary policy across the board next year and cut interest rates in mid-2023.

The market will then focus on the June meeting minutes of the Federal Reserve FOMC, the US June ISM non-manufacturing index and the US May JOLT survey job vacancy report, which will be released on Wednesday. and general economic trends.

On the geopolitical front, U.S. Treasury Secretary Yellen and Chinese Vice Premier Liu He held a conference call on Tuesday to discuss overall U.S. and China economic and financial developments, as well as the global economic outlook amid rising prices and food security challenges. Direct discussion for the first time in months.

In response to China’s continued calls for the United States to cancel all additional tariffs on China, the White House responded on Tuesday that the Biden administration is still considering tariff-related options, but “POLITICO” reported on Tuesday that US President Biden is only considering $10 billion worth of Chinese goods. Tariffs are removed, while a new exemption application process is launched for businesses.

The global epidemic of new coronary pneumonia (COVID-19) continues to spread. Before the deadline, data from Johns Hopkins University in the United States pointed out that the number of confirmed cases worldwide has exceeded 550 million, and the number of deaths has exceeded 6.34 million. More than 12 billion doses of vaccines have been administered in 184 countries worldwide.

The performance of the four major U.S. stock indexes on Tuesday (5th):
Energy, utilities and materials sold off the most among the 11 S&P sectors, with only communications services, consumer discretionary and information technology in the red. (Image: finviz)
Focus stocks

The five kings of science and technology are like rainbows. Apple (AAPL-US) was up 1.89%; Meta (META-US) was up 5.10%; Alphabet (GOOGL-US) was up 4.16%; Amazon (AMZN-US) was up 3.60%; Microsoft (MSFT-US) was up 1.26% .

The Dow Jones components traded in and out of each other. Chevron (CVX-US) fell 2.63%; Pioneer Heavy Industries (CAT-US fell) 2.54%; IBM (IBM-US) fell 2.48%; Nike (NKE-US) rose 3.1%; Salesforce (CRM-US) rose 2.38%.

More than half of the fee constituents rose. AMD (AMD-US) rose 2.08%; NVIDIA (NVDA-US) rose 3.04%; Applied Materials (AMAT-US) fell 0.31%; Micron (MU-US) rose 5.74%; Texas Instruments (TXN-US) rose 0.38%; Qualcomm (QCOM-US) rose 1.86%.

Taiwan stock ADR only TSMC received black. TSMC ADR (TSM-US) fell 1.16%; ASE ADR (ASX-US) rose 1.00%; UMC ADR (UMC-US) rose 0.15%; Chunghwa Telecom ADR (CHT-US) rose 1.15%.

Corporate News

Apple (AAPL-US) rose 1.89% to $141.56 a share. JPMorgan said estimated lead times for Apple products suggest that the average lead time for iPhones has stabilized at four days, with Macs and Apple Watches likely to be most affected by supply chain constraints, but the overall impact remains modest.

Dutch semiconductor equipment ASML ADR (ASML-US) dropped 4.55% to $409.00 per share. U.S. officials are lobbying ASML to ban the sale of some older extreme ultraviolet (EUV) exposure machines or deep ultraviolet (DUV) systems to China, foreign media reported, citing sources.

British pharmaceutical giant AstraZeneca (AZN-US) fell 0.67% to $65.51 a share. AstraZeneca announced on Tuesday that it has acquired TeneoTwo for $1.27 billion to strengthen its blood cancer product line, and is expected to complete the acquisition in the third quarter.

Tesla (TSLA-US) rose 2.55% to $699.20 per share. Due to the shutdown in Shanghai and supply chain challenges, Tesla delivered 254,695 vehicles in the second quarter of 2022, ending a seven-quarter record in nearly two years. According to the market, some production lines in China and Germany will be shut down in the next few weeks. JPMorgan analysts believe that Tesla’s production capacity and earnings may be affected by specific implementation issues in Berlin, Germany and Austin in the United States. $395 was cut to $385, well below the consensus forecast in a Refinitiv poll.

Ford (F-US), the second-largest U.S. automaker, fell 1.02% to $11.20 a share, nearly halving its share price so far this year. Ford reported second-quarter sales rose 1.8 percent to 483,688 vehicles, well below analysts’ expectations for an annual increase of 3.3 percent to 5.1 percent.

Economic data
  • The monthly growth rate of U.S. factory orders in May was 1.6%, expected 0.5%, and the previous value was 0.7%
  • The monthly growth rate of U.S. durable goods orders in May was revised to 0.8%, expected to be 0.7%, and the previous value of 0.7%
Wall Street Analysis

Investment bank Barclays said the removal of U.S. tariffs on some Chinese goods would have only a modest impact on U.S. inflation and the yuan.

John Stoltzfus, chief investment strategist at Oppenheimer, said: “As the first half of the year passes, investors can’t help but wonder what to expect this year, and so far, the level of uncertainty, confusion and dysfunction that has disrupted a variety of asset classes has risen. the value of.”

Erin Browne, a fund manager at Pimco, expects the bond market to not experience the usual summer blandness this year, with the market going through a rough patch before there are signs of inflation peaking.

“The Fed’s hawkish tone should be prevalent right now, and we’ll be watching closely for evidence of inflation that officials are monitoring to gauge the direction of monetary policy,” said Sam Bullard, senior economist at Wells Fargo.

The figures are updated before the deadline, please refer to the actual quotation.

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