Special topic: dividend market is expected to last for a long time, but we need to be alert to short-term correction
In the early morning of the 17th Beijing time, US stocks closed down slightly on Thursday. The Dow broke through the 40000 point mark in the session. The market continued to pay attention to the US stock financial report and the monetary policy prospect of the Federal Reserve. Several Fed officials made speeches, and Cleveland Fed President Meister said that the policy of high interest rates should be maintained for a longer period of time.
The Dow fell 38.62 points, or 0.10%, to 39869.38; The Nasdaq Composite Index fell 44.07 points, or 0.26%, to 16698.32; The S&P 500 index fell 11.05 points, or 0.21%, to 5297.10.
In Thursday's intraday trading, the Dow rose as high as 40051.05. The Nasdaq Composite Index rose to 16797.83 and the S&P 500 Index rose to 5325.49, both hitting new intraday highs.
A number of Federal Reserve officials delivered speeches on Thursday, including Federal Reserve Governor Barr, Richmond Fed President Barkin, Cleveland Fed President Mester, Atlanta Fed President Bostick, etc.
Cleveland Federal Reserve Bank President Meister said that policymakers need more data to ensure that inflation is moving towards the Federal Reserve's 2% target. She suggested that officials keep interest rates high for a longer period of time to achieve this goal.
Mester reiterated that the current monetary policy is in a good position, and added that she expected the cooling rate of price growth will be slower than last year, because the improvement brought by supply chain disturbance has been reduced.
She said: "The upcoming economic information shows that it will take longer to gain such confidence. As our understanding of the inflation path becomes clearer, it is prudent to maintain our inhibitory stance for a longer time."
Mest said earlier this week that the policy was in a "good position". It is too early to say that inflation is stagnating. She reiterated this view on Thursday.
"Our current monetary policy position puts us in a good position to manage possible emerging risks," she said in her speech. "Without sufficient evidence to convince us that the inflation rate is falling back to 2% in a sustainable and timely manner, lowering the interest rate too early or too fast will probably make the progress we have made in inflation go to waste."
Mester has a vote in decision-making this year. She will step down when her term expires at the end of June. The next meeting of Federal Reserve policymakers will be held from June 11 to 12.
Minneapolis Fed President Kashkari reiterated on Wednesday that the central bank may need to keep interest rates at the current level "for a period of time", and questioned the degree of inhibition of interest rates on the US economy.
On Tuesday, Powell, the chairman of the Federal Reserve, made it clear that he believed that the Federal Reserve would need at least one quarter of data to truly judge whether inflation was falling steadily to 2%. This means that the Federal Reserve will need more than three inflation reports to be confident of lowering interest rates from a 23 year high. If the data supports interest rate cuts, the Federal Reserve will be able to cut interest rates for the first time in September.
On the economic data side on Thursday, the Labor Department reported that as of the week of May 11, the number of Americans applying for unemployment benefits for the first time was 222000, expected to be 220000, and the previous value was 231000. As of May 4, the number of continuous claims rose to 1.79 million.
The US import price index rose 0.9% month on month in April, expected to be 0.30%, compared with the previous value of 0.40%.
The annual figure of the total number of new housing starts in the United States in April was 1.36 million, with 1.42 million expected, compared with 1.321 million previously. In April, the total number of construction permits was 1.44 million, expected to be 1.485 million, and the previous value was 1.458 million.
The Philadelphia Federal Reserve's manufacturing index in May was 4.5, expected to be 8, and the previous value was 15.5.
CPI inflation data released on Wednesday was lower than expected, pushing major stock indexes to record highs. The S&P 500 index broke through 5300 for the first time.
The US Labor Department reported on Wednesday that the US consumer price index (CPI) rose 0.3% month on month in April, slightly lower than Dow Jones Estimated 0.4%. The index grew 3.4% year on year. CPI index is a measure of the cost price of goods and services.
The US CPI inflation data strengthened the market's bet that the Federal Reserve will start cutting interest rates this year. After the data was released, investors' preference for risky assets improved, and their concern about the continued rise of inflation was alleviated.
Another retail sales data released on Wednesday showed that strong consumer demand has weakened. The US Department of Commerce reported that US retail sales in April grew 0% month on month, lower than the market expectation of 0.4%. The previous value was revised from 0.7% to 0.6%. Most of the expenditure of the month is spent on necessities such as food and gasoline.
Ipek Ozkardeskaya, senior analyst of Ruixun Bank, said: "The combination of slowing growth and weakening inflation is a great gift for the stock market. For investors, nothing is more attractive than the taste of future interest rate decline."
JPMorgan Chase He said that the CPI data in April gave people a sigh of relief. Inflation is returning to the downward track. He still believes that the Federal Reserve will cut interest rates for the first time in July, but this may be achieved only after further cooling of labor market activities.
Morgan Stanley They said that they expected that inflation would cool down more in the future, especially in the second half of the year. They believed that the Federal Reserve would cut interest rates for the first time in September this year.
Goldman Sachs Said that they maintained the expectation that the Federal Reserve would cut interest rates by 25 basis points for the first time in July, and it is expected that the Federal Reserve will cut interest rates quarterly thereafter.
Focus stocks
Nvidia will announce its quarterly results on May 22, and its shares have been praised by many investment banks.
KeyBanc capital market analysts set Nvidia's target share price at $1200. Prior to this, Goldman Sachs recently gave a 12-month target price of $1100 ($875 before March), because the agency raised its EPS (earnings per share) forecast for the fiscal year 2025 to 2027, with an average increase of 8%, indicating a continuous and strong improvement in AI server demand and supply.
Tesla CEO Mask recently revealed the online time of Cybertruck's fully automatic driving (FSD) function.
Cybertruck has been on the market for more than half a year, but Tesla has not provided the important function of FSD on the electric pickup. Musk confirmed that Cyberrock will obtain the FSD function of v12.5. For Tesla, it will be a major test to enable FSD function on Cybertruck, because it is the first time that this function is applied to this model.
HHLR Advisors, a fund under Hillhouse, released the position data of US stocks by the end of the first quarter of 2024 on Wednesday. In the first quarter, the focus of the organization was to build positions in 20 stocks, mostly in semiconductor and electronic technology fields, such as AMD , Nvidia TSMC Etc; And liquidate or close to liquidate a number of Internet stocks, including JD.COM 、 Ali Baba 、 IQIYI Etc.
Omdia, a market research organization, said on Thursday that, Apple It is very unlikely to launch the flip screen iPhone, because it will compete with its 6.1 inch to 6.9 inch iPhone products. On the contrary, Apple may launch 7.9-inch expandable book folding products. Compared with just expanding the screen size of the same device, it is more meaningful to increase the screen size and user use scenarios.
Microsoft On May 15, local time, it was revealed in the Environmental Sustainable Development Report 2024 that in the 2023 fiscal year, the emissions of the company's scope 1 and scope 2 (the greenhouse gas emissions directly generated by the assets owned or operated by the company, and the emissions generated by the company due to the outsourcing of electricity, heating and steam) were 6.3% less than those in 2020, but the emissions of scope 3 (the emissions generated by the company's overall value chain) Increase by 30.9%, the latter is mainly related to data center construction.
Google Recently, the annual I/O developer conference was held. According to the official statistics of Google, in this 110 minute speech, Google CEO Pizza Yiti and AI had 121 times. At the same time, he launched a series of products and services with AI as the core, and launched Veo, a video generation model that claimed to be more effective than Sora. The whole conference left a deep impression on the big banks of Wall Street.
A national study released by the Center for Urban Economic Development of the University of Illinois at Chicago on May 15 shows that, Amazon Five years after the company raised the hourly wage to $15, half of the warehouse workers surveyed said they could not afford enough food or shelter. The researchers surveyed 1484 employees in 42 states of the United States. 53% of the respondents said that they had experienced one or more forms of food insecurity in the past three months, and 48% of the respondents had experienced one or more forms of housing insecurity.
EU regulators said Thursday that they would investigate whether META violated the Digital Services Act on the protection of minors. The European Commission said in a statement that it was concerned that Meta's Facebook and Instagram systems, including their algorithms, might stimulate children's behavioral addiction and cause the so-called "rabbit hole effect".
In addition, the European Commission also expressed concern about Meta's age assurance and verification methods, adding that it would now give priority to in-depth investigations and would continue to collect evidence by "sending additional information requests, conducting interviews or inspections". The EU further stated that "the initiation of formal procedures gives the European Commission the right to take further enforcement steps, such as interim measures and non-compliance decisions."
Influenced by the news that the Zhishang Institute plans to launch Bitcoin spot transactions, blockchain concept stocks generally rose.
Wal-Mart The revenue in the first fiscal quarter increased by 6% year on year to $161.5 billion, $3.36 billion higher than the market expectation. Non GAAP EPS was US $0.6, up 22.4% year on year, US $0.08 higher than the market's expectation.
Looking ahead, Wal Mart expects that its revenue will grow by 3.5% to 4.5% in the second quarter, its operating profit will grow by 3% to 4.5%, and its adjusted EPS will be $0.62 to $0.65. For the annual performance, Wal Mart currently expects that the adjusted EPS in 2025 will be at or slightly higher than the top of the previous guidance (the previous guidance range was $2.23 to $2.37), higher than the market expectation of $2.37; It is also expected that the revenue growth rate in 2025 will be at or slightly higher than the top of the previous guidance (the previous guidance range is 3% to 4%), and the market is expected to be 4.31%.
Cisco The revenue in the third fiscal quarter exceeded expectations, and the annual revenue guidance was raised.
The share price of Chubb rose, and Buffett invested heavily in the stock in the first quarter.
Baidu The performance of the first fiscal quarter exceeded expectations.
IQIYI's revenue in the first fiscal quarter exceeded expectations.
Zhongtong The adjusted net profit of express in the first fiscal quarter increased by 15.8% year on year.
In other market scenes, the price of WTI futures for June delivery on the New York Mercantile Exchange rose by 0.60 US dollars, or 0.76%, to close at 79.23 US dollars per barrel.
Brent crude oil futures for July delivery rose 52 cents, or 0.63%, to US $83.27 per barrel.
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