US stocks experienced a clear downward trend on Wednesday, driven by lackluster cloud results from Alphabet (GOOGL) and a surge in interest rates. The housing market also played a role, with an unexpectedly robust housing report and a 'tailing' five-year sale contributing to the decline. New Home Sales in September exceeded expectations, indicating the resilience of the post-pandemic US economy and consumers. Despite the rise in mortgage rates and the cost of home ownership, the housing market has remained strong. This, along with the growing consensus that interest rates are unlikely to return to pre-pandemic levels, suggests that the higher-for-longer yield environment is here to stay. As a result, various stock valuations may be impacted, potentially leading to negative stock performance into year-end. [4b887dbc]
The US Federal Reserve chairman Jerome Powell has indicated that interest rates will not be cut for a longer period of time due to higher-than-expected inflation readings. Treasury yields and mortgage rates have reached new highs. This news adds to the concerns about rising interest rates and their impact on the stock market. [84c88b12]
In addition to the interest rate concerns, Apple plans to invest over US$250 million to expand its Ang Mo Kio campus in Singapore. This investment reflects Apple's confidence in the growth potential of the technology sector in Singapore and its commitment to expanding its presence in the country. [84c88b12]
Furthermore, GuocoLand has won a joint venture tender for a land parcel at Upper Thomson Road in Singapore for S$779.5 million. The company reported strong financial results for the first half of fiscal 2024, with revenue surging by 61% year on year. This successful tender and positive financial performance indicate the strength of the real estate market in Singapore and GuocoLand's position in the industry. [84c88b12]
The direction of US interest rates has been a topic of discussion. Jerome Powell, chairman of the US Federal Reserve, stated that the country would likely not need another rate increase to temper inflation, but did not provide a timeline for potential rate cuts. The Federal Reserve kept interest rates unchanged and would need persuasive evidence that inflation is not coming down to increase rates. [9728e840]
Wilmar International Limited reported a decline in revenue and net profit for the first quarter of 2024. CDL Hospitality Trusts, on the other hand, reported a rise in total revenue and net property income for the same period. CDLHT's Singapore hotels reported healthy operating statistics, and the trust is planning asset enhancement initiatives for two of its properties. [9728e840]
US economic growth 'decreased a bit more sharply than expected', leading to a sharp sell-off on Wall Street. The chance of a September interest rate cut in the United States faded overnight. Inflation in the US remains elevated, which has triggered a warning from investors who started selling shares frantically. [840122ee] [4b887dbc] [84c88b12]
Markets fell in Asia and Europe on Friday, tracking a sell-off on Wall Street sparked by better-than-expected US data that added to worries the Federal Reserve will hold off on cutting interest rates this year. Confidence was dealt a further blow Thursday as a closely watched gauge of the services sector showed activity rose at its fastest pace in a year, while the factory sector also beat forecasts. The readings indicated the world’s top economy was still in rude health, quelling the excitement sparked by last week’s news that the consumer price index slowed in April after three months of topping forecasts. All three main indexes in New York ended in the red, and Asia followed suit. Hong Kong fell for a fourth straight day, having hit a nine-month high this week, while there were also losses in Tokyo, Shanghai, Seoul, Singapore, Sydney, Bangkok, Wellington, Taipei, and Manila. London, Paris, and Frankfurt also fell. The prospect of interest rates remaining at two-decade highs through most of the year put upward pressure on the dollar. [4defb517]
Global stocks diverged on Friday as US rate cut hopes diminished. Wall Street swung higher, but European stocks fell as investors fret over data suggesting the US Federal Reserve could keep interest rates higher for longer. Asian and European stock markets fell following Wall Street losses on Thursday as better-than-expected US data compounded worries that the Federal Reserve will hold off on cutting interest rates this year. European and US indices have rallied to new records in recent days thanks to solid first-quarter earnings by companies and their positive outlook, despite the fact that it is looking increasingly unlikely that the Fed will begin cutting interest rates this year. Other data showing that the US economy is coping with high interest rates, thus reducing any pressure on the Fed to cut them, has also been denting confidence in a quick reduction in borrowing costs. London was additionally hit by data showing a 2.3% April slump in UK retail sales, days after hotter-than-expected inflation doused chances of a Bank of England rate reduction any time soon. [a4b1b843] [4defb517] [b0d01f49]
US stocks experienced gains in choppy trading on Tuesday following softer-than-expected labor market data, increasing expectations of a Federal Reserve rate cut. Job openings fell to a three-year low, indicating a loosening labor market. Despite some sector losses, major indexes and megacap technology stocks posted gains. Market expectations for a September rate reduction now stand around 65%, versus below 50% last week, according to the CME's FedWatch tool. [ff00686e]
Equities mostly rose on building optimism that the Federal Reserve will cut interest rates before the end of the year after the latest batch of data indicated the long-resilient US market was showing signs of easing. However, worries were emerging about the state of the US economy as consumers deal with high inflation and borrowing costs. Job vacancies fell far more than expected to below 8.1 million, the lowest level since 2021. The figures come ahead of closely watched non-farm payrolls figures due Friday. Some investors are getting uncomfortable with the 'Goldilocks' narrative and are looking for a more consistent trajectory of consumption. Bets on a Fed rate cut before the end of the year picked up. Asian markets, including Hong Kong, Tokyo, Shanghai, Sydney, Singapore, Taipei, Manila, and Jakarta, all experienced buying interest. Indian futures rose after Prime Minister Narendra Modi formed a coalition government, raising hopes for economy-boosting measures. The Nikkei 225 was up 0.9%, the Hang Seng Index was up 1.0%, and the Shanghai Composite was up 0.3%. The dollar/yen exchange rate was down at 155.70 yen, the euro/dollar exchange rate was up at $1.0889, and the pound/dollar exchange rate was up at $1.2803. West Texas Intermediate crude oil was up 0.6% at $74.50 per barrel, and Brent North Sea crude was up 0.4% at $78.74 per barrel. The Dow Jones was up 0.3% at 38,807.33, and the FTSE 100 was up 0.2% at 8,246.95. [8b1cb808]
Hong Kong stocks may retreat to 18,000 points as momentum stalls ahead of China and the US's key inflation data as well as the US Federal Reserve meeting this week. France's decision to call a snap election weighed on global markets, causing a sell-off in Europe. The euro fell to its lowest in more than a month against the US dollar. China and Hong Kong markets were closed for a holiday. Traders have reduced bets for US rate cuts this year due to a still-tight US labor market. Non-farm payrolls increased by 272,000 jobs last month, well above expectations. The US dollar strengthened and US Treasury yields remained elevated. Markets are now pricing in 36 basis points of Fed rate cuts this year. China and US consumer inflation data will be closely watched. Oil prices edged up, aided by hopes of rising fuel demand. Spot gold rose 0.25 percent. The Bank of Japan holds its two-day monetary policy meeting this week. Japan's GDP fell less than expected. The US leads China as Korea's top export market. Xiaomi denies SU7 price cuts. Secondary home sales perk up as new launches take a breather. Apple poised to make AI leap. Banks in Singapore step up checks on wealthy clients. Meituan's profit soars 60% to 5.3b yuan in Q1. Nio sinks deeper into the red. [0755023b]
On Wednesday, Wall Street will face an economic double-whammy with the release of the May Consumer Price Index (CPI) report in the morning and the Federal Reserve's announcement on its key interest rate in the afternoon. The CPI report and the Fed's policy meeting have coincided only seven times since 2014. While some investors believe that the stock market is unlikely to swing widely due to these events, unexpected comments from Fed Chair Powell or higher-than-expected inflation metrics could lead to a small sell-off. The Fed is expected to keep rates on hold this month, but upcoming CPI data will guide its decisions in the second half of the year. Inflation showed signs of cooling in April, but other metrics suggest that inflation is still taking time to come down. The Fed will also release its latest projections for future rates and the number of rate cuts expected in 2024. Meanwhile, a survey by the Federal Reserve Bank of New York shows that US consumers are more optimistic about their current and future financial situation, the stock market, and slowing inflation. In other news, Microsoft and Google will offer free or discounted cybersecurity services to rural hospitals in the US to protect them from cyberattacks that have disrupted patient care. [85b5fe7a]
The Federal Reserve has indicated that at least one interest rate cut is still on the table for 2024, but in the short term, higher US borrowing costs are expected to stay. Recent economic data suggests that inflation is cooling again, leading to record highs in the stock market. Traders are anticipating that the central bank will keep rates unchanged in July, which means interest rates will remain at their current 23-year high until at least September. Wylie Tollette, chief investment officer at Franklin Templeton Investment Solutions, suggests that the stock market has already priced in the expectation of fewer rate cuts. He believes that the higher-for-longer rates are a return to a more normal rate environment and that the US economy has shown resilience in the face of these rates. Sectors such as real estate and consumer durables may be negatively impacted by higher rates, while semiconductors, energy, and materials are expected to perform well. Utilities may also benefit due to increased demand for electricity. In terms of employee engagement, Gallup estimates that low engagement costs the global economy $8.9 trillion, or 9% of global GDP. Negative daily emotions and lack of well-being can hurt worker engagement and productivity. Apple has become the most valuable public company in the US, surpassing Microsoft, following announcements made at its annual Worldwide Developers Conference. The stock market data is provided by BATS and the US market indices are shown in real time, except for the S&P 500 which is refreshed every two minutes. [d2c9de5f]