In the early morning of the 19th Beijing time, US stocks closed down on Friday. Technology stocks continued to decline, with the three major stock indexes all recording losses for the third consecutive week. The market is concerned about the deadlock in the US fiscal stimulus negotiations and the timetable for the launch of the vaccine.JPMorganEarly warning that US stocks may usher in a massive sell-off. The number of confirmed cases of the global coronavirus has exceeded 30 million. The Dow fell 244.56 points, or 0.88%, to 27657.42 points; the Nasdaq fell 116.99 points, or 1.07%, to 10793.28 points; the S&P 500 index fell 37.54 points, or 1.12%, to 3,19.47 points.
This week the Dow fell 0.03%, the Nasdaq fell 0.55%, and the S&P 500 fell 0.64%, both for the third consecutive week of decline. Friday is the so-called quadruple magic day, that is, the expiry settlement date of derivative financial products such as stock index futures, stock index options, stock options and futures. Usually the market volatility on this day will be amplified. Including this Friday, in the first three quadruple magic days of this year, the S&P 500 index closed down.
Technology stocks continue recent downtrend
Technology stocks continued to decline on Friday. Dow component Boeing closed down 3.9%, Apple fell 3.3%, Cisco fell 1.4%, and Microsoft fell 1.2%. Google fell 2.4% and Amazon fell 1.8%. Facebook, Nvidia, Intel and others generally closed down.
Oracle shares fell. According to a reference report, the U.S. Department of Commerce announced on Friday local time that U.S. companies will be prohibited from conducting business transactions with WeChat and TikTok. The statement also prohibits U.S. companies from providing services through WeChat “for the purpose of transferring funds or processing payments within the United States.” . Earlier there were reports that Oracle was trying to reach a partnership agreement with TikTok’s parent company.
So far this month, some large technology stocks have suffered double-digit declines as investors moved out of the market leaders that had soared before. Amazon, Microsoft, Facebook and Apple have all fallen more than 10% so far this month. Prior to the recent sell-off, the price-to-earnings ratio of the Nasdaq 100 index actually exceeded 40, the highest level since 2004.
Adam Crisafulli, founder of Vital Knowledge, said: “The technology stocks have been sold off on September 3 and have suffered a lot so far. Technology stocks have risen too much in the summer and are now squeezing water, and there is still a lot of water. To squeeze.”
Investors are still evaluating the long-term impact of the Fed’s latest policy statement. The Federal Reserve said on Wednesday that economic recovery may be a long-term process and it is not expected to raise interest rates for at least the next three to four years.
Robert Greil, chief market strategist at Merck Finck Privatbankiers AG, said that after the recent series of central bank meetings, the market seems to have lost momentum. At present, further industry stimulus policies or the US fiscal stimulus bill are catalysts that the market is eagerly looking forward to.
Fed officials’ speech is concerned, Bostic says more financial support is needed
Fed officials’ speeches have attracted attention. Fed officials who spoke today included St. Louis Fed President James Bullard and Atlanta Fed President Raphael Bostic.
Bostic said: “The U.S. economy is slowing down and needs more financial support. Many Americans are suffering from the recession triggered by the epidemic.”
Bostic said: “We are bound to see signs of a slowdown in the economy. Certain parts of the economy, whether it is geographic location or industry, are performing well and are still growing. Other aspects are still struggling or practical. It’s getting worse.”
He said: “What I want to tell decision makers is that in many areas, there is still a lot of pain and confusion. Many families face great uncertainties, these things will damage our psychology and growth ability. I encourage decision makers to consider Things that can provide support to help people in dangerous situations so that they don’t have to struggle and worry”
Regarding the new monetary policy framework, he said: “The policies derived from the long-term framework are important because we are committed to keeping the economic growth rate slightly higher than our previous tolerance ceiling.”
Bostic has no voting rights on the Federal Open Market Committee this year.
St. Louis Fed President Brad is optimistic about the US economy, saying that “exceeding expectations” growth will help push up inflation. He said that by the end of the year the unemployment rate in the United States is expected to fall to 6.5%, which is far lower than the median estimate of 7.6% issued by the Federal Reserve earlier this week. The US unemployment rate in August was 8.4%, lower than the 14.7% at the peak of the new crown epidemic.
He said: “This will be the largest growth quarter in the history of the United States, and the annualized growth rate may reach 30%.” Brad added that this growth will help the Fed achieve its 2% inflation target.
The Governor of the Federal Reserve Bank of Minneapolis, Kashkari, said that large investors who own shares in and trade with major U.S. banks should urge these banks to reduce risks in the financial system by increasing capital levels.
“Why should I come to you? Because you are in a unique position to promote much-needed reforms in the banking industry and the wider financial market that have proven to be very fragile,” Kashkari told the Institutional Investor Committee on Friday. Said in the speech prepared for the virtual meeting.
U.S. fiscal stimulus negotiations remain deadlocked
Investors continue to pay attention to the progress of the US Congressional fiscal stimulus package negotiations. Many people believe that in the context of economic contraction caused by the coronavirus epidemic, fiscal stimulus measures are essential to maintain and further promote the rise of US stocks.
Although U.S. President Trump urged an agreement to be reached as soon as possible, negotiations between Democrats and Republicans on a new round of coronavirus relief stimulus package are still deadlocked.
Democrats in the US House of Representatives passed a $3.5 trillion relief bill in May. But they said in recent negotiations with White House officials that they will accept the $2.2 trillion agreement.
The Speaker of the U.S. House of Representatives Nancy Pelosi (Nancy Pelosi) said that Democrats may push for an agreement larger than the $2.2 trillion proposal they had previously proposed, but would not accept proposals smaller than that.
Pelosi said: “What we are discussing in the negotiations is the allocation of resources. But we will not accept proposals below $2.2 trillion because the demand is greater.”
Morgan Stanley economists recently stated that if the Republicans and Democrats fail to agree on a new round of US fiscal stimulus, the time required for the US economy to return to its pre-epidemic level will be delayed by six months.
Moroccan economists Ellen Zentner and Michael Zezas wrote in the latest report: “It is becoming increasingly difficult to ignore the fruitless issues in the negotiations. If the negotiations have not progressed in the short term, we tend to remove the positive from the basic expectations. Fiscal stimulus (this assumption).”
At the same time, the Federal Reserve is conducting a second round of stress tests on the banking industry during the coronavirus epidemic. According to reports, the Federal Reserve is considering continuing to restrict the banking industry’s dividend payments and stock repurchases.
Xiaomo warns that US stocks may be sold on a large scale
Nick Panagirtzoglou, a market mobility expert at JPMorgan Chase, said that considering the huge “rebalancing” exposure of some large funds, it is estimated that about $200 billion of stocks will be forced to sell. These large funds include the US fixed-income pension fund and the Japanese government pension fund. Investment funds and Norwegian Petroleum Fund.
Investment bank Bernstein (Bernstein) said that with the occurrence of a potential second wave of epidemics, the US stock market will be hit.
In a report on Thursday, Bernstein warned customers that the United States is likely to truly usher in a second wave of the epidemic, as it is currently experiencing in Europe, which may require some steps to reverse economic opening.
According to the latest real-time statistics of the WHO, as of 16:01 on September 18, Central European Daylight Time (22:01 on September 18, Beijing time), there have been a total of 3,055,710 confirmed cases of coronavirus worldwide and a total of 943,433 deaths. The number of confirmed cases of the global coronavirus has exceeded 30 million. In the past period of time, about 1.8 million new confirmed cases of coronavirus were added every week in the world, and the maximum number of new cases in a single day exceeded 300,000. The cumulative number of global cases has increased from 20 million to 30 million in only 37 days.
When the coronavirus vaccine will be launched, Trump and the director of the US Centers for Disease Control are in disagreement
Robert Redfield, director of the Centers for Disease Control and Prevention (CDC), testified to the U.S. Senate Appropriations Committee on the 17th local time, said that the first batch of new coronary pneumonia vaccines may be available in November or December, but because The number is limited and it is unlikely to be popularized by the public before the summer of 2021.
Redfield said: “I think the first batch of vaccines will come out between November and December, but the number of supplies will be very limited, so there must be a priority screening. If you ask me when will be fully available to the United States People, to restore our normal lives, I think maybe at the end of the second quarter or the beginning of the third quarter of 2021.”
When asked by the senators “why must the vaccine be released in November (election month), and whether there is political motivation”, Redfield did not respond positively, saying only that the institution’s “scientific ethics” had not been manipulated, and Will not be manipulated.
A few hours later, U.S. President Trump rejected Redfield’s vaccine schedule at a White House news briefing. He said: “I think he made a mistake in saying that. We are ready to distribute vaccines to a large number of people. This time is much faster than what he (Redfield) said.”
Trump said the coronavirus vaccine will be approved in the next few weeks. He said: “I did this not for political reasons. I just want the vaccine to come out quickly. It may be 4 weeks, maybe 8 weeks. We have many great companies.”
Tesla will host a battery day event next week.
The CEO of Moderna said in an interview that it is unlikely to complete Phase III clinical trials in October to prove the effectiveness of the vaccine.
AstraZeneca will announce the trial protocol for the new crown vaccine.
Southwest Airlines announced earlier that half of its more than 100 Boeing 737-800 aircraft that were grounded earlier will be put back into operation.
Delta Air Lines and the pilot union reached a preliminary agreement to reduce the number of pilots on mandatory leave.
Boeing Honeywell announced that Rolls-Royce Deutschland is its partner in Germany to maintain the CH-47 Chinook helicopter engine operated by the Luftwaffe.
NIO will redeem an 8.6% stake in NIO China from investors.
The major European stock indexes closed down collectively on Friday. The Stoxx Europe 50 index closed down 1.01%, the German DAX index closed down 0.64%, the UK FTSE 100 index closed down 0.76%, and the French CAC40 index closed down 1.22%.
Gold futures prices closed higher on Friday. This week, the price of gold recorded an increase for the second consecutive week. The Fed hinted that it will maintain a low interest rate policy in the next three to four years, which will give gold prices some support.
ActivTrades analyst Carlo Alberto De Casa said: “Gold is waiting for new drivers. The current market environment and the Fed’s policy stance seem to have been fully reflected in the price of gold.”
The price of gold futures for December delivery on the New York Mercantile Exchange rose by $12.20, or 0.6%, to close at $1962.10 per ounce.
December silver futures prices rose 3 cents, or 0.1%, to close at $27.129 per ounce.
Gold futures prices rose 0.7% this week, and silver rose 1%.
US WTI crude oil futures closed slightly higher on Friday, while Brent crude oil closed lower. However, driven by news that the major oil-producing countries pledged to fully comply with the production reduction agreement, this Tuesday all had their biggest weekly gains since June.
Stephen Innes, chief global market strategist at AxiCorp, said: “For OPEC+, this is not a big deal. However, OPEC+’s commitment to continue to comply with production reduction quotas, with Saudi Arabia’s pressure to comply with production reduction quotas, seems to have had a positive impact on the market.”
The Organization of Petroleum Exporting Countries and its allies (OPEC+) held a ministerial-level joint monitoring committee meeting on Thursday and decided to extend the period of compensatory production cuts for countries that had not fully restricted production in the previous months.
West Texas Intermediate Crude Oil (WTI) futures prices for October delivery on the New York Mercantile Exchange rose 14 cents, or 0.3%, to close at $41.11 per barrel.
The London Intercontinental Exchange’s November Brent crude oil futures price fell 15 cents, or 0.4%, to close at $43.15 per barrel.
This week, WTI crude oil futures rose 10.1%, and Brent crude oil futures rose 8.3%, both of which set the largest weekly gains since June 19.