Major U.S. stock indexes opened lower on Wednesday (1st), weighed down by forecasts that central banks may remain hawkish for months, offsetting optimism brought about by strong Chinese manufacturing data. 10-Year Treasury Bond Yieldclimbed to nearly 4%. In addition, traders awaited U.S. economic data.
before the deadline,Dow Jones Industrial Averagefell nearly 20 points or nearly 0.1%,Nasdaq Composite Indexfell nearly 0.15%,S&P 500 Indexfell nearly 0.2%,Philadelphia SemiconductorThe index rose nearly 0.8 percent.
Major index futures wobbled ahead of the U.S. open on speculation that central banks could remain hawkish in the coming months, dragging stocks up.inS&P 500 IndexFutures were volatile after modest gains after a flurry of data showed China’s economy was heading towards a stronger recovery, with China’s manufacturing purchasing managers’ index (PMI) hitting a 10-year high in February.
In terms of individual stocks, the pre-market share price of Novavax pharmaceutical company in the United States plummeted after the company warned of serious doubts about its ability to continue operating; the electric vehicle start-up company Rivian’s pre-market share price fell due to the impact of the supply chain.
In other news, the European Central Bank’s (ECB) task was further complicated by the latest data showing that German inflation unexpectedly picked up in February. The data showed that Germany’s Harmonized Consumer Price Index (CPI) rose 9.3% year-on-year in February, far higher than the market’s expected 9% and the previous value of 9.2%. In addition, inflation indicators in other parts of Europe exceeded the target this week.
The market is currently pricedEURThe terminal interest rate in the region is 4%, and the ECB is expected to continue raising interest rates until February 2024. Bond traders also see less chance of a rate cut by the Federal Reserve this year than a month ago.
“February has poured cold water on hopes that policymakers may continue to push inflation down to target levels,” strategists at Generali Investments wrote in their monthly outlook.
As of 22:00 on Wednesday (1st) Taipei time:
Focus stocks:
Tesla (TSLA-US) fell 0.28% to $205.13 per share in early trade
Tesla’s “Investor Day” event will be held at 4:00 pm Eastern Time (5:00 am Taiwan Time) on Wednesday, and the third phase of the “Master Plan” proposed by Musk will also be announced soon. The market is expected to announce integrated die-casting, energy storage, third-generation model platform and Model Q. In addition, foreign media reports pointed out that Tesla is preparing to carry out a production transformation of the Model Y model. The plan is called “Project Juniper” and the production target is 2024.
Rivian(RIVN-US) fell 10.36% in early trade to $17.30 per share
U.S. stocks of electric vehicle start-up Rivian fell nearly 9% before the market, after the company reported revenue of $663 million last quarter, much higher than the $54 million in the same period in 2021, and a net loss of $1.723 billion, also higher than the same period in 2021. narrowed, but last quarter and last year’s revenue failed to meet Wall Street analysts’ expectations.
Novavax (NVAX-US) fell 25.83% in early trade to $6.87 per share
The stock price of Novavax pharmaceutical company in the United States plunged before the opening bell, plummeting more than 27%. The company reported revenue of $357.4 million in the fourth quarter of last year, far below analysts’ expectations of $380.3 million; last quarter’s loss per share was $2.28, far higher than analysts’ forecast for a loss of $1.15. Due to the uncertainty of revenue and financing sources, the company’s ability to continue operating is seriously doubted.
Today’s key economic data:
- The final value of the U.S. manufacturing PMI in February was 47.3, expected 47.8, and the previous value was 46.9
- The monthly rate of US construction spending in January was -0.1%, expected 0.2%, and the previous value was -0.7%
- U.S. February ISM manufacturing index reported 47.7, expected 48, previous value 47.4
Wall Street Analysis:
The Federal Reserve is likely to raise interest rates to nearly 6% as strong U.S. consumer demand and a tight labor market will force it to fight inflation for longer, BofA Global Research said. The agency’s estimate was well above the peak of 5.4 percent that traders had priced in last September.
Rating agency Moody’s predicts that the real gross domestic product (GDP) of the United States will grow by 0.9% this year, and maintains its forecast for GDP growth of 1.1% next year. Moody’s expects the U.S. economy to stagnate this year, with moderate growth in the first half of the year and a slight contraction in the second half of the year, and expects real GDP to shrink by about 1% in the third and fourth quarters.
