Market Insights: May 27th, 2024

Profits of Chinese Industrial Enterprises:

Data released by the National Bureau of Statistics shows that the profit growth rate of industrial enterprises above a designated size turned positive in April,How to open a foreign exchange account in China indicating a continued improvement in China's economy. The specific data are as follows:

• Overall Profit Growth: From January to April, the total profit of industrial enterprises above a designated size nationwide reached 2,094.69 billion yuan, a year-on-year increase of 4.3%. In April alone, the profit of these enterprises grew by 4.0% year-on-year, a significant turnaround from last year's -3.5%.
• Industry Breakdown:
  • Mining Industry: Achieved a total profit of 392.39 billion yuan, a year-on-year decrease of 18.6%.
  • Manufacturing: Achieved a total profit of 1,443.98 billion yuan, a growth of 8.0%.
  • Production and Supply of Electricity, Heat, Gas, and Water: Achieved a total profit of 258.32 billion yuan, an increase of 36.9%.

Commodity Markets:

Hawkish Statements from the Fed Cause Decline in Gold, Copper, and Oil Prices

Over the past week, hawkish statements from the Federal Reserve had a significant impact on the commodity markets:

• Crude Oil: Rebounded after hitting a three-month low during trading, with a weekly decline of more than 2%.
• Gold: New York futures gold fell for four consecutive days, with a weekly decline of more than 3%, marking the largest weekly drop in eight months.
• Copper: London copper also fell for four consecutive days, with a weekly decline of more than 3%.
• Nickel: Despite a rebound, London nickel still declined nearly 4% for the week.

Cryptocurrency:

The cryptocurrency market showed significant volatility:

• Bitcoin: Rose by more than $2,000 during trading, climbing back above the $69,000 mark.
• Ethereum: Once dropped nearly 7%, far from its two-month high, but still posted a weekly increase of over 20%.

Chinese Concept Stocks and RMB Exchange Rate Fluctuations:

• Chinese Concept Stocks: The index of Chinese concept stocks fell for five consecutive trading days on the US stock market, with a weekly decline of nearly 9%. Among them, NetEase fell 4.5% the day after its earnings report, while Pinduoduo rose more than 7% during trading and accumulated an 8% increase for the week.
• RMB: Offshore RMB fell below 7.26 during trading, hitting a near four-week low.
• A-H Shares: Continued to consolidate, with the Shanghai Composite Index falling below 3,100 points, marking the birth of the first tenfold stock of the year.

Evergrande Auto Resumes Trading:

On May 26, Evergrande Auto announced on the Hong Kong Stock Exchange as follows:

Share Acquisition: Approximately 3.145 billion potentially pending shares (about 29% of total issued shares) will be immediately acquired, and another approximately 3.203 billion potentially pending shares (about 29.5% of total issued shares) may be acquired within a certain period after the signing of the purchase agreement. The company’s shares resumed trading on the Hong Kong Stock Exchange at 9 AM on May 27, 2024.

A-Share Market:

On May 27, news indicated that the three major indices of the A-share market opened slightly higher:

• SSE Composite Index: Rose by 0.17%.
• Shenzhen Component Index: Rose by 0.21%.
• ChiNext Index: Rose by 0.31%.

Sector Performance:

• Highest Gains: The non-ferrous metals and electricity reform sector indices performed prominently.
• Highest Losses: Sectors such as AIPC, switches, and Kirin batteries declined.
• Internet E-commerce: Sai Microelectronics, Cross-border Connect surged over 7%, with other stocks like Santai Shares, Focus Technology, RuoYuChen, and Xinghui Shares following suit.

European and American Stock Markets:

• Dow Jones: Dow Jones rose slightly by 0.01%, the S&P 500 Index increased by 0.7%, and Nasdaq increased by 1.1%.
  • Top gainers included Intel up by 2.13%, JPMorgan Chase up by 1.93%, Tesla up by 3.17%, and Facebook up by 2.67%.
    Most Chinese concept stocks fell, with Zeekr down by 9.53% and Zai Lab down by 5.98%.
• Weekly Performance: For the week, Dow Jones fell by 2.33%, while the S&P 500 Index edged up by 0.03%, and the Nasdaq rose by 1.41%, marking five consecutive weekly gains for both the S&P 500 and Nasdaq. In Europe, the German DAX Index edged up by 0.02%.

Forex and Futures Market:

• US Dollar Index: Decreased by 0.27% to 104.7421, with a weekly increase of 0.24%.
• Non-US Currencies: Performance varied among non-US currencies; offshore RMB against the dollar fell 38 basis points to 7.2618, with a cumulative weekly decline of 281 basis points.
• International Precious Metals Futures:
  • COMEX gold futures fell 0.09% to $2,335.2 per ounce, with a weekly decline of 3.4%.
  • COMEX silver futures rose 0.28% to $30.54 per ounce, with a weekly decline of 2.3%.
• International Oil Prices:
  • US oil for July delivery climbed 1.21% to $77.8 per barrel, with a cumulative weekly decline of 2.24%.
  • Brent oil for August delivery rose 1.02% to $81.94 per barrel, with a cumulative weekly decline of 2.43%.

Bank of Japan Policy:

Former Member Predicts Year-End Base Rate Hike

Former policy committee member Masai Takako predicts that if the economic situation stabilizes, the Bank of Japan may raise the base rate to 0.5% by year-end. She noted that the price increases over the past two years have altered businesses' and households' inflation expectations.

Risk Warning and Disclaimer

The market carries risks, and investment should be cautious. This article does not constitute personal investment advice and has not taken into account individual users' specific investment goals, financial situations, or needs. Users should consider whether any opinions, viewpoints, or conclusions in this article are suitable for their particular circumstances. Investing based on this is at one's own responsibility.

Very good!（123）