The US memory giant Micron gave a pessimistic outlook, dragging down chip stocks, the Nasdaq fell more than 100 points, and the US consumer price index (CPI) in July will be announced tomorrow, will the results affect the Federal Reserve? (Fed) plans to raise interest rates, investors cautiously wait and see, US stocks opened mixed on Tuesday (9th).
At the time of writing, the Dow Jones Industrial Average fell 0.17%, the Nasdaq Composite fell more than 100 points or nearly 1.1%, the S&P 500 fell 0.42%, and the Philadelphia Semiconductor Index fell 3.44%.
Following Micron’s (MU-US) consecutive gloomy financial forecasts, the stock price fell more than 4% in pre-market trading, and the decline narrowed to 2.93% after the opening bell. Other technology stocks such as NVIDIA (NVDA-US), AMD (AMD-US) ) shares were also affected in early trade, down 2.21% and 2.37% respectively.
In terms of political and economic news, U.S. President Biden will sign the chip bill today, and Micron also announced earlier that it will invest $40 billion to expand its chip manufacturing plant in the United States by 2029, mainly funded by government subsidies provided by the bill.
At present, the market is focusing on the inflation report released tomorrow (10th) to find out whether the consumer price index (CPI) has peaked in June. Economists predict that the annual growth rate of CPI in July will be the largest in more than two years. drop. In addition, the US non-farm payrolls data rose sharply in July, easing fears of a recession, while corporate performance remained outstanding.
However, the rebound in U.S. stocks has become fragile, as stronger-than-expected economic data dampened optimism that the Federal Reserve will slow the pace of interest rate hikes, although most investors took confidence in the results of S&P 500 companies 81% of these companies exceeded expectations.
As of 21:00 on Tuesday (9th) Taipei time:
Stocks in focus:
Occidental Petroleum (OXY-US) rose 3.16% to $61.94 a share in early trade
“Stock God” Buffett’s Berkshire Hathaway (Berkshire Hathaway) once again swept Western oil companies, with a shareholding ratio of more than 20%. Berkshire Hathaway said it spent $391 million on 6.68 million Occidental shares between Aug. 4 and Aug. 8, according to regulatory filings. Berkshire Hathaway has held 188.4 million Occidental shares worth $11.3 billion so far.
SoFi Technologies (SOFI-US) fell 3.72% to $7.68 a share in early trade
According to Reuters, citing documents, SoftBank Group sold another 6.7 million shares of its financial technology company SoFi Technologies at $8.17 per share yesterday (8th), three days after SoftBank sold 5.4 million shares at $7.99. The news affected SoFi’s stock price before the market fell nearly 4%.
Allbirds (BIRD-US) fell 21.88% to $4.43 a share in early trade
Sneaker manufacturer Allbirds lowered its full-year financial forecast due to consideration that external unfavorable factors may put pressure on consumer spending in the second half of 2022. The news affected Allbirds’ stock price before the market fell nearly 12%.
Today’s key economic data: The initial quarterly growth rate of unit labor costs in the second quarter of the United States was reported at 10.8%, expected 9.5%, and the previous value was 12.7%. , the previous value – 7.4%, the US August IBD/TIPP economic optimism index is expected to be 40.2, the previous value is 38.5 Wall Street analysis:
Seema Shah, chief global strategist at Principal Global Investors, said counter-trend rallies are characteristic of long-term bear market downtrends, and from that perspective, 2022 is very similar to previous bear markets in history. Until inflation subsides and the Fed rebalances its priorities from inflation to growth, the tantalizing rebound may remain unsustainable.
A team of JPMorgan strategists led by Marko Kolanovic said investors should moderately underweight equities and shift funds to commodities after stocks outperformed other assets as recession fears subsided. But that doesn’t mean the team expects the stock market to fall; in fact, they think the stock market has been rising through the end of the year, mainly due to strong corporate earnings.
Morgan Stanley analyst Michael J. Wilson expressed reservations about the recent stock market rally, calling it a “bear market rally” amid growing fears of a recession. He believes that while inflation has peaked and is likely to fall faster than the market currently expects, it does not bode well for the stock market as it will reduce operating leverage and weigh on corporate earnings.