U.S. Stocks
Fundamental Analysis:
U.S. stocks closed sharply lower on Thursday, 16th February 2023, after unexpectedly strong inflation data and a drop in initial jobless claims last week fueled concerns that the Federal Reserve will continue to raise interest rates to curb high prices.
The Labor Department report showed that producer prices rose in January at their highest rate in seven months due to a big increase in the cost of energy products.
The report also showed that the number of U.S. initial jobless claims fell unexpectedly last week, providing more evidence that the labor market is still tight.
Thursday’s economic data and other reports this week painted a picture of high inflation and an economy that remains relatively strong in the face of a Fed rate hike.
After a selloff in 2022, the S&P 500 has climbed about 7% so far in 2023, driven by upbeat results and cautious expectations that the Fed’s rate-hike action has completed its major part.
The market expects the Fed to push the target rate above 5% by May and keep it above that level until the end of the year.
Also on Thursday, Federal Reserve Bank of Cleveland President Mester said inflation remains too high and noted that at the last monetary policy meeting, she was open to raising rates by a greater margin than other peers would like.
Federal Reserve Bank of St. Louis President Bullard said Thursday that continued rate hikes would help “lock in” the slowing inflation trend, even as the economy continues to grow.
The decline in U.S. stocks accelerated in late trading. The S&P 500 index fell 1.38% to close at 4090.51 points. The Nasdaq fell 1.78% to 11,855.83, while the Dow Jones Industrial Average dropped 1.26% to 33,696.39.
Tesla slumped 5.7% after the electric car maker said it is recalling 362,000 vehicles in the U.S. after U.S. auto regulators said its fully automated driving beta software could cause crashes.
Technical Analysis:
(Dow 30, 1-hour chart)
Execution Insight:
The Dow pays attention to the 33584-line today. If the Dow runs stably above the 33584-line, then pay attention to the suppression strength of the 33949 and 34221 positions.
Hong Kong Stocks
Fundamental Analysis:
U.S. stocks fell overnight as expectations of a U.S. interest rate hike rose.
Hong Kong stocks opened slightly lower, the Hang Seng Index (HSI) fell 0.14%, the Hang Seng China Enterprises Index (HSCEI) fell 0.05%, the Hang Seng TECH Index (HSTECH) fell 0.17%.
On the market, large technology stocks were mixed, NetEase, Inc. (9999.HK), Alibaba Group Holding Limited (9988.HK), Tencent Holdings Limited (0700.HK) rose slightly, Baidu, Inc. (9888.HK) fell 1%, Kuaishou Technology (1024.HK), Xiaomi Corporation (1810.HK), and Meituan (3690.HK) were lower.
Lithium battery stocks rebounded, Ganfeng Lithium Group Co., Ltd. (1772.HK) rose 1% to stop 5 consecutive losses, while retail stocks, most of the gold stocks rose, auto stocks were mixed.
On the other hand, domestic housing stocks generally fell, gambling stocks, restaurant stocks weakened, Haidilao International Holding Ltd. (6862.HK) fell 1%.
Technical Analysis:
(HK50, 1-hour chart)
Execution Insight:
HK50 pays attention to the 21450-line today. If HK50 can run stably above the 21450-line, then pay attention to the suppression strength of the two positions of 22127 and 22785.
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