U.S. Stocks Mixed, Nasdaq Down 2%, Nvidia’s 10% Plunge Drags Tech Lower

U.S. stocks closed mixed on Friday, with significant downturns in the tech sector led by a 10% plunge in Nvidia. This contributed to a six-day losing streak for both the S&P 500 and Nasdaq.

Investors have shifted their focus from the recent Israeli military strikes against Iran to more pressing concerns about the Federal Reserve’s monetary policy direction and upcoming earnings reports from major companies like Netflix and Procter & Gamble.

A significant factor in the recent market pullback is the adjustment of expectations regarding Federal Reserve rate cuts. Economists and strategists now believe the Fed will not consider cutting rates until at least September, with increasing speculation that there may be no rate cuts at all this year.

Michael Landsberg, Chief Investment Officer at Landsberg Bennett Private Wealth Management, highlighted inflation as the primary concern for the stock market, noting, “Inflation is accelerating again, and there’s real uncertainty about whether the Fed will cut rates in 2024, let alone once or twice.”

U.S. Stocks

Fundamental Analysis:

The tech sector saw widespread declines, with Nvidia’s stock value falling below $2 trillion. Netflix dropped over 9%, while Meta and Broadcom each declined more than 4%. Amazon and Intel fell over 2%, and Microsoft, Apple, Google, and Tesla all dropped more than 1%, with Tesla hitting a new low for 2023.

The semiconductor, blockchain, and computer hardware sectors were among the hardest hit, with Advanced Micro Devices falling over 23%, Arm over 16%, AMD over 5%, Micron Technology over 4%, ASML and Coinbase over 3%, and Qualcomm, Dell Technologies, and Coherent each over 2%.

Popular Chinese concept stocks were mostly down, with the Nasdaq Golden Dragon China Index falling 1.04% for the week, accumulating a 2.09% loss.

Li Auto dropped over 9%, NIO 5%, and XPeng Motors over 3%. IQIYI declined over 2%, while Weibo, Tencent Music, and Bilibili fell over 1%.

Baidu, Pinduoduo, and Futu Holdings saw slight declines. However, Manbang, NetEase rose over 1%, and Alibaba, JD.com, and Vipshop saw minor gains.

Technical Analysis: 

(S&P 500 Index, 1-day chart)

Market Trends:

  • Nasdaq fell 319.49 points, a decrease of 2.05%, to 15,282.01.
  • Dow rose 211.02 points, an increase of 0.56%, to 37,986.40.
  • S&P 500 dropped 43.89 points, a decrease of 0.88%, to 4,967.23.

Hong Kong Stock Market

Fundamental Analysis:

Today, Hong Kong’s major indices initially surged but later fell.

Tech stocks led gains, with Meituan and Tencent up nearly 5%, and JD.com, NetEase, and Alibaba each over 3%.

The real estate sector generally rose, with Sunac China and CIFI Holdings each up over 4%.

Following a surge, new energy vehicle manufacturers saw declines amid escalating price wars, with Li Auto leading with a drop of over 6%.

As Middle East tensions eased, gold stocks fell, with Shandong Gold Mining and Zijin Mining each dropping over 6%.

Additionally, sectors like mobile gaming, beer, real estate investment trusts, and logistics were among the top performers.

Gold stocks fell collectively, with Shandong Gold Mining and Zijin Mining each dropping over 6%. A

nalyst Sybilla Gross noted that geopolitical tensions in the Middle East had eased, reducing safe-haven demand, which, coupled with traders awaiting U.S. data, led to lower gold prices.

Technical Analysis: 

(Hang Seng Index, 1-day chart)

Market Trends:

  • Hang Seng Index (HSI) rose 1.74%, to 16,506.66.
  • Hang Seng Tech Index (HSTECH) rose 1.95%, to 3,343.04.
  • Hang Seng China Enterprises Index (HSCEI.) rose 1.59%, to 5,838.22.

FTSE China A50 Index

Fundamental Analysis:

China’s A-share major indices initially surged but later fell back, briefly turning positive before weakening.

The defense and military industries saw significant gains, while sectors like oil and gas, precious metals, and others experienced declines.

In sector performance, defense, pork, beverage manufacturing, and medical equipment led gains, while oil and gas, precious metals, coal, and the low-altitude economy led declines.

Overall, more stocks fell than rose, with over 3,000 stocks declining. The total transaction volume for the morning session in the Shanghai and Shenzhen markets was 557.1 billion yuan, a decrease of 15.4 billion yuan from the previous trading day.

Technical Analysis:  

(SSE Composite Index, 1-day chart)

Market Trends:

  • Shanghai Composite Index (SHCOMP) fell 0.47%, to 3,050.89.
  • Shenzhen Component Index (SZCOMP) fell 0.17%, to 9,263.38.
  • ChiNext Index (CHINEXT) fell 0.19%, to 1,752.72.
  • SSE Sci-Tech Innovation 50 Index rose 0.42%, to 733.61.

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