US Stocks Rise on Signs of Progress on Debt Ceiling Deal – Friday Market Update

Major U.S. stock indexes rose in early trade on Friday (12th) amid signs that U.S. lawmakers are making progress on a deal to raise the debt ceiling.Dow Jones Indexup 0.23%,NasdaqThe index rose 0.25%,S&P 500 Indexup 0.25%,fee halfThe index fell 0.06%, and US banking stocks tried to rebound.

Concerns over debt-ceiling negotiations have not gone away, with a meeting between U.S. President Joe Biden and congressional leaders originally scheduled for Friday being postponed until next week. The delay reflects progress in discussions at the employee level, according to people familiar with the matter.

Meanwhile, weaker-than-expected PPI data, while a sign of moderating inflation, failed to insulate investors from lingering worries about a downturn ahead.

Marie Jacot-Cardoen, chief executive of Edmond de Rothschild Asset Management France, said they were confident a deal would eventually be reached, although political confrontation could intensify until a deal is reached.

The weaker-than-expected PPI data brought signs of slowing inflation, but this situation did not relieve investors from continued concerns about the economic downturn in the future, especially as some investors noted that the current stock market is still only led by a small number of stocks.

On U.S.-China relations, the Biden administration is rumored to be working hard to secure a series of meetings and phone calls with China, making it difficult for Beijing to refuse engagement with Washington.

As of 21:00 on Friday, Taipei time:

• Dow Jones IndexUp 76.29 points or 0.23%, tentatively reported at 33385.80 points
• NasdaqUp 30.29 points or 0.25%, tentatively reported at 12358.80 points
• The S&P 500 rose 10.39 points, or 0.25%, to tentatively trade at 4141.01 points
• fee halfDown 1.92 points or 0.06%, tentatively at 2995.58 points
• TSMC ADR up 0.46% to $83.80 per share
• 10-Year U.S. Treasury YieldUp 3 basis points to 3.41%
• N.Y. Light crude rose 0.66% to $71.34 a barrel
• Brent Crude OilUp 0.55% to $75.39 a barrel
• golddown 0.5% to $2,009.60 an ounce
• dollar indexUp 0.22% to 102.27

Focus stocks:

Tesla (TSLA-US) rose 2.3 percent to $176.03

The US electric car manufacturer Tesla has raised prices again. Its US official website shows that it has raised the prices of Model X, Model S, and Model Y.

According to Tesla’s US official website, the price of Model X has been raised to $98,490, and the price of Model X Plaid has been raised to $108,490. The Model S was raised to $88,490 and the Model S Plaid was raised to $108,490. Model Y is raised to $47,490, Model Y Long Range is raised to $50,490, and Model Y High Performance is raised to $54,490.

At the beginning of the month, Tesla also announced that it will increase the prices of the new Model S and the new Model X in the Chinese market.RMB 19,000 yuan.

PacWest (PACW-US) rose 1.71 percent to $4.77

PacWest said its deposits fell about 10% in the first week of May. Earlier this month, PacWest said it was exploring strategic options, including a sale.

PacWest has also been at the center of the banking turmoil since the collapse of Silicon Valley Bank in March.

The announcement led to an accelerated pace of deposit outflows, which fell 9.5% from $28 billion on May 2, according to a PacWest regulatory filing. Since then, PacWest shares have lost more than a fifth of their value, extending losses to about 85% over the past year.

Huida (NVDA-US) rose 0.52 percent to $287.27

Bank of America said in a report that instead of trying to pick a winner in the artificial intelligence (AI) race, why not just pick a company that provides the necessary hardware for all AI companies? If any company ends up dominating the AI ​​race, Huida is in a good position and can profit from it.

According to the report, Huida is the dominant hoe and shovel in the “AI gold rush”, referring to the period during the gold rush of the 1850s, when merchants who sold gold digging tools actually made more money than gold diggers.

Wall Street Analysis:

Angeline Ong, financial analyst at IG Group, said inflation was starting to show some signs of easing, boosting hopes that the Fed’s rate-hiking cycle was coming to an end. That means businesses can start prioritizing growth over paying down debt.

Fundstrat co-founder Tom Lee said fangs (FAANG) stocks are poised to soar 50% this year.

Lee pointed out that the demand for fang stocks is not decreasing, it will actually increase, and there will be no new competitors. The profitability of fang stocks will be higher in the future, which is why he believes that the price-to-earnings ratio of fang stocks can expand, and it does pull the overall market.

Bank of America strategist Harnett (Michael Hartnett) said that at a time when technology stocks are attracting a lot of investment funds, a long-term economic downturn in the United States will bring impact to technology stocks. Hartnett and his team said they expect a recession to “hit credit and technology stocks hard” like it did in 2008.