The U.S. stock market closed lower on Thursday. The February Producer Price Index (PPI) data from the U.S. showed that overall inflation rates exceeded expectations for the second consecutive month, indicating that inflation is still on the rise. This further solidify market expectations that the Federal Reserve won’t rush to cut interest rates. After the release of the PPI data, U.S. bond yields rose, putting pressure on stock indices.

The core PPI in the US rose by 2% year-over-year in February, higher than the expected 1.9%, remaining unchanged from the previous reading. On a monthly basis, the core PPI increased by 0.3%, lower than the expected 0.5%, but accelerating from the previous month’s 0.2%.

Analysts noted that the higher-than-expected increase in the U.S. PPI in February was mainly due to rising fuel and food prices, further indicating that inflation is intensifying. The data suggests that policymakers at the Federal Reserve face challenges in their efforts to combat inflation.

U.S. Stock Market

Fundamental Analysis: 

In the U.S. stock market, large-cap tech stocks showed mixed performance, with Tesla falling over 4%, accumulating nearly a 35% decline year-to-date.

Advanced Micro Devices (AMD) also fell over 4%, while Nvidia dropped over 3%. However, Microsoft and Google saw gains of over 2%, with Microsoft reaching a historical high in its stock price.

Amazon and Apple rose over 1%, with Apple reportedly acquiring Canadian AI startup DarwinAI to bolster its generative AI capabilities.

Popular Chinese tech stocks experienced widespread declines, with the Nasdaq Golden Dragon China Index falling over 2%. Futu Holdings led the losses, dropping nearly 14%, while Bilibili and XPeng fell over 6%.

NIO and Li Auto both fell over 5%. Alibaba, JD.com, Baidu, and NetEase all experienced declines of over 3%. Weibo and Tencent Music fell over 1%, while Vipshop and Pinduoduo saw slight increases.

Technical Analysis: 

(S&P 500 Index, 1-day chart) 

Market Trends: 

• Dow Jones Industrial Average (DJIA) fell 137.66 points, or 0.35%, to close at 38,905.66.
• Nasdaq Composite dropped 49.24 points, or 0.30%, to end at 16,128.53.
• S&P 500 index declined 14.83 points, or 0.29%, settling at 5,150.48.

Hong Kong Stock Market

Fundamental Analysis: 

In Hong Kong, all three major indices opened low and continued to decline.

In the tech sector, Meituan fell over 4%, while Baidu, Alibaba, and JD.com all dropped over 3%. Stocks in the pharmaceutical outsourcing sector continued their downward trend, with WuXi AppTec falling over 4%.

The automotive sector saw collective declines, with NIO falling over 4%. Among property stocks, Longfor Group led the losses, dropping nearly 6%. In the insurance sector, China Life Insurance fell over 4%.

Technical Analysis: 

(Hang Seng Index, 1-day chart) 

Market Trends: 

• Hang Seng Index (HSI) dropped 2.09% to close at 16,607.26.
• Hang Seng Tech Index fell 2.76% to end at 3,504.25.
• Hang Seng China Enterprises Index (HSCEI) declined 2.38% to close at 5,766.19.

FTSE China A50 Index

Fundamental Analysis: 

In the A-share market, all three major indices opened lower, with the Shanghai Composite Index showing weak and volatile performance in the morning session. The ChiNext Index and the Growth Enterprise Market (GEM) Index continued to decline, with both falling by over 1%.

Technical Analysis:  

(SSE Composite Index, 1-day chart) 

Market Trends: 

• Shanghai Composite Index fell 0.18% to close at 3,032.84.
• Shenzhen Component Index dropped 0.68% to end at 9,490.87.
• ChiNext Index declined 1.59% to close at 1,853.03.
• Sci-Tech Innovation 50 Index (STAR 50) rose 1.05% to settle at 796.41.

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