Wednesday Market Recap
On Wednesday, US stocks rallied, with the Dow Jones Industrial Average gaining over 700 points and the S&P 500 marking its biggest single-day rise since November 2024. The Nasdaq broke its five-day losing streak.
December’s CPI inflation data aligned with expectations, bolstering hopes of a potential Federal Reserve rate cut this year. Strong earnings from major banks and the Fed’s Beige Book report showing modest economic growth added to market optimism.
The CPI report indicated that inflationary pressures are easing, with some analysts predicting the Fed might cut rates as early as March. According to the Bureau of Labor Statistics, December’s headline CPI rose 0.4% month-over-month (slightly above the 0.3% forecast) and 2.9% year-over-year, matching expectations. Core CPI (excluding food and energy) climbed 3.2% annually, slightly below the forecast of 3.3% and down from November’s 3.3%.
Skyler Weinand, Chief Investment Officer at Regan Capital, noted:
“Wednesday’s CPI data was softer than expected, suggesting the Fed may still have room to lower rates in 2025. This brought relief, especially after last week’s robust jobs report.”
US Stocks Overview
Large-cap tech stocks surged:
- Tesla soared over 8%.
- Meta, Nvidia, and Google climbed over 3%.
- Microsoft, Netflix, and Amazon gained over 2%.
Chinese ADRs mostly rose:
- NetEase jumped over 8%.
- XPeng and Futu Holdings gained more than 3%.
- Baidu and Pinduoduo added over 2%.
- Li Auto and Miniso fell more than 2%.
Technical Analysis of US Market
Market Recap
- Dow Jones: +703.27 points (+1.65%) at 43,221.55
- Nasdaq: +466.84 points (+2.45%) at 19,511.23
- S&P 500: +107 points (+1.83%) at 5,949.91
Hong Kong Stock Market Overview
Hong Kong’s major indices opened higher and held gains:
- Tech stocks advanced: NetEase rose nearly 2%, while JD.com, Meituan, and Xiaomi gained about 1%.
- Gold stocks led the rally: Lingbao Gold surged nearly 7%.
- Property stocks rebounded: Sino-Ocean Group climbed nearly 6%.
- Energy stocks showed strength: CNOOC gained over 2%.
- Consumer sectors such as appliances, machinery, and entertainment posted notable gains.
Technical Analysis of Hong Kong Market
Market Recap
- Hang Seng Index: +0.83% to 19,445.68
- Hang Seng Tech Index: +0.86% to 4,401.33
- Hang Seng China Enterprises Index: +0.71% to 7,061.17
A50 & China A-Share Market Overview
China’s A-share indices rose early but pared gains:
- Early enthusiasm boosted sectors like computing, brokerage, and appliances.
- After an initial 2% jump in the ChiNext Index, profit-taking led to a selloff in semiconductors, with Cambricon Technologies plunging over 16%. Robotics and chip-related themes also retreated.
Technical Analysis of China Market
Market Recap
- Shanghai Composite Index: +0.21% to 3,233.92
- Shenzhen Component Index: +0.06% to 10,065.76
- ChiNext Index: +0.01% to 2,038.21
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