Last week’s July nonfarm payrolls data eased some worries about an economic slowdown, but investors remained cautious as the data also increased expectations for a hawkish stance from the Federal Reserve, with the four major U.S. stock indexes on Monday ( 8) were mixed.
Before the deadline, the Dow Jones Industrial Average rose more than 200 points or nearly 0.65%, the Nasdaq Composite Index rose more than 100 points or nearly 1%, the S&P 500 rose nearly 0.7%, and the Philadelphia Semiconductor Index fell nearly 0.9%.
The U.S. Senate narrowly passed the Democratic-proposed, landmark “Inflation Reduction Act” by a narrow 51-50 vote, which will focus on issues such as taxation, climate and health care. The estimated voting time is Friday (12th).
The news of the bill encouraged green energy-related stocks to rise before the market, First Solar (FSLR-US) rose more than 6%, SunRun (RUN-US) rose more than 5%, and electric vehicle stocks also survived. Tesla ( TSLA-US) rose 2.35%, Rivian (RIVN-US) rose 2.61%, and Lucid (LCID-US) rose 1%.
In terms of financial reports, Japanese investment giant SoftBank Group today announced a net loss of US$23.4 billion (about NT$702.4 billion) in the first quarter, mainly due to the successive interest rate hikes by central banks around the world, triggering a sell-off in technology stocks. SoftBank Chief Executive Masayoshi Son said on Monday that the group was considering layoffs at its flagship investment arm, the Vision Fund.
International oil prices fell, while gold prices rose, amid concerns that an economic slowdown could affect demand. On the other hand, Bitcoin prices rose above $24,000 as investors turned to digital assets to lead cryptocurrency prices higher after last week’s strong U.S. nonfarm payrolls report.
U.S. stocks rallied higher in July as U.S. companies reported better-than-expected second-quarter earnings, as investors bet corporate profit margins could withstand inflationary pressures, and dovish optimism surrounding the Fed amid weaker economic data It also boosted market sentiment.
However, Morgan Stanley and Goldman Sachs Group strategists predict that given the continued cost pressure, corporate profit margins will decline next year, a prospect that does not match the sentiment of the stock market. Among them, Morgan Stanley strategists are more blunt. The best rally in U.S. stocks is over.
On the central bank front, San Francisco Fed Bank President Mary Daly said the Federal Reserve will not be limited to raising rates by 2 yards (50 basis points) at its next policy meeting, adding that the Fed is far from reducing inflation. goal achieved. Meanwhile, Fed Governor Michelle Bowman said the Fed should continue to consider a 3-yard (75 basis point) rate hike similar to the one passed last month until inflation falls significantly.
As of 21:00 on Monday (8th) Taipei time:
Stocks in focus:
Baidu (BIDU-US) rose 0.69% to $138.77 a share in early trade
According to reports, the government departments of Chongqing City and Wuhan City, Hubei Province have taken the lead in releasing the pilot policy for the commercialization of autonomous driving, and issued the first batch of unmanned demonstration operation qualifications to Baidu (9888-HK), allowing no safety in the car. to commercialize self-driving vehicles on social roads; Baidu is exclusively approved.
Palantir (PLTR-US) fell 14.10% to $9.84 per share in early trade
U.S. big data services company Palantir Technologies reported earnings for the second quarter of its 2022 fiscal year before the market, with revenue up 26% to $4.73 a share and an adjusted loss of $0.01 per share, in part due to Palantir’s acquisition of a special purpose acquisition company (SPAC). investment. In addition, Palantir slumped more than 15% in early trading as it cut its full-year revenue forecast as the timing of securing some large government contracts remains uncertain.
Global Blood Therapeutics (GBT-US) rose 4.42% to $66.66 a share in early trade
Blood disease drug company Global Blood Therapeutics will be acquired by Pfizer for $5.4 billion, or $68.50 per share in cash. GBT shares have surged 88% over the past two sessions on the news, before jumping more than 4% in premarket trading on Monday.
Today’s key economic data: The previous value of the US Conference Board Employment Trends Index in July was 119.37 Wall Street Analysis:
Mizuho International rates strategist Peter McCallum said the drop in nonfarm payrolls was big enough to spark the inflation debate and refocus the U.S. consumer price index (CPI) data. He believes that in fact only an unexpected drop in the annual rate of CPI growth in July will the market stop thinking the Fed must do more, and as the Fed tightens monetary policy further, the possibility of a hard landing for the economy increases.
Strategists at TD Securities, including Priya Misra, wrote in a note that the U.S. nonfarm payrolls report for July could increase the Fed’s propensity for an early rate hike until policy rates rise sharply above mid-point in the coming months. sexual level.