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Wall Street jumps as light inflation reignites end-hiking bets

Bull markets

Macro Scenes:

  • Wall Street jumped following lighter-than-expected inflation data. US headline CPI rose 3.2% year over year vs. 3.3% expected. The core CPI was at 4% annually vs. 4.1% estimated. On a monthly basis, the headline CPI was flat from September, the slowest since July 2022.
  • The US Treasury yields slumped, with the 2-year yields down 21 bps to a three-month low. Markets are pricing now more rate hikes by the Fed and a possible rate cut in March 2024, according to the CME Fed Watch Tool.
  • The US dollar index tumbled, lifting all the other major currencies. The New Zealand dollar and the Australian dollar strengthened the most as both commodity currencies are seen as riskier assets.
  • Real Estate stocks were the best performers in the S&P 500 as the sector benefited from lower interest rate expectations.
  • Gold extended the second-straight day gains due to slumped bond yields and weakened USD. Spot gold rose above the key resistance of 1,945 again.
  • Crude oil finished lower, mostly due to a darkened demand outlook in response to the US CPI data, as the light inflation data also points to slowing economic growth.  
  • Chinese stock markets are set to open sharply higher as Beijing plans to inject roughly 1 trillion yuan to shore up its economy. The Hang Seng Index futures rose 2.05%. The ASX futures were up 1.3%, pointing to a higher open following Wall Street’s rally.

     

Chart of the Day:

Gold, daily

Source: CMC Markets as of 15 November 2023

Company News:   

  • Foxconn (TPE: 2354) reported an 11.27% year-on-year profit growth in the third quarter, but the operation revenue slipped 11.64% from a year ago. The company is the world’s largest contract electronics supplier to major tech companies, such as Apple. Research data shows that global smartphone sales extended a year-on-year decline for nine consecutive quarters.
  • Tesla (NDX: TSLA) jumped 6% to a nearly one-month high of above US$237 per share, extending its second straight day of gains after it updated the terms of its cybertruck order agreement that buyers cannot sell the vehicle within the first year of purchase without Tesla’s permission.
  • Serko Limited (NZX: SKO) reported a total income of NZ$36.3 million, up 87% year on year in the first half of FY24. Its online booking rose 26% to 2.5 million. The EBITDAF loss is NZ$0.8 million, or 96% up from last year.

Today’s Agenda:

  • New Zealand’s visitor arrivals for September
  • Japanese Prelim GDP for Q3
  • Australia’s wage price index for Q3
  • China’s Industrial Production, Retail Sales, and Fixed Asset Investment for October
  • US PPI for October


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