SignalPlus Macro Research Report (20231019): Macroeconomic uncertainty has intensified, and the crypto market continues to fluctuate in a wide range.
The U.S. stock market and digital currency market have continued to fluctuate in the past two weeks. Since the last Federal Reserve interest rate meeting, there have been rumors in the market that the Federal Reserve will announce a suspension of interest rate increases at the next interest rate meeting. However, the author believes that the suspension of interest rate increases does not mean an interest rate cut, especially In this round of interest rate hikes, the U.S. economy has shown no signs of recession, and Nasdaq has even entered a bull market trend. Therefore, at the level of monetary policy, the Fed has a lot of room for maneuver. On the other hand, the blockchain market lacks new themes to attract OTC funds, so it still maintains a large range of fluctuations.
Yesterday, the market once again experienced a typical fluctuation. First, the geopolitical aspect is still deteriorating (oil embargo and sanctions). As regional tensions continue to escalate, many President Bidens scheduled visits have been cancelled.
In terms of fixed income, it seems that it has not yet gotten over the haze of last weeks poor auction results pushing up yields. The U.S. bond market was relatively weak in the morning trading session before the 20-year auction. The rise in UK CPI has hurt the European fixed income market in early trading. , and then the relatively strong US housing construction data (965,000 single-family home construction permits, 8 consecutive increases), once again pushed the 30-year yield to above 5%.
Thankfully, the 20-year bond auction turned out well (1.2 basis points below expectations, bid multiple 2.59), coupled with Fed Waller (core PCE has fallen to the Feds 2% target on a 3-month annualized basis) and Friendly comments from Williams that policy rates are already at or near peaks kept a lid on yield gains in the afternoon session, however, given that inflation expectations have remained elevated in recent months and amid tensions between the U.S. and China , Chinas holdings of U.S. debt fell again, falling to the lowest level since 2009. U.S. debt may still be difficult to get out of trouble in the short term.
On the stock market front, stocks were under early pressure due to geopolitical conflicts, rising oil prices and mixed corporate earnings results, with the SPX closing down 1.3%, with all sectors except energy and consumer staples in the red. In terms of financial reports, Netflixs third-quarter profit met market expectations, its users grew significantly, and it announced a price increase plan, causing its stock price to rise more than 12% after the market closed. At the same time, Telsas profit failed to meet expectations, but its gross profit margin was in line with It is expected, and promised, that the first batch of Cybertruck deliveries will begin on November 30th.
On the other hand, due to mixed forward guidance, Lam Researchs share price fell 4% and dragged down the semiconductor sector. Investors are still more worried about the impact of the United States continued export ban; finally, due to poor performance in the investment banking sector and wealth management Divisional revenue fell sharply below expectations, and Morgan Stanelys shares fell 6.8%, the largest one-day drop since June 2020.
On the cryptocurrency side, prices have been relatively stable, although disappointingly, Reddit has announced that it will be phasing out its “Community Points” system, which launched in 2020 and was one of the most promising blockchain-based rewards programs. , the platform will phase out the system by November, citing Ethereums limited scalability and regulatory issues, causing the related token (Moon) to fall by 90%, adding more pain to the already troubled NFT field.
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