U.S. Stocks Rally As S&P 500 And Nasdaq Rebound From Six-Day Losing Streak

U.S. stocks closed higher on Monday, with technology stocks leading the way, as both the S&P 500 and Nasdaq snapped a six-day losing streak.

The easing of tensions in the Middle East provided a boost to the stock indices.

This week, the market’s focus will be on the earnings reports from the ‘Big Seven’ U.S. stocks and the March PCE price index, a key inflation indicator closely watched by the Federal Reserve.

Companies including Tesla, Meta Platforms, American Airlines, Microsoft, and Google’s parent company Alphabet are scheduled to release their earnings this week.

Tesla will report after Tuesday’s market opens, Meta Platforms on Wednesday, and Apple, Intel, and Microsoft on Thursday.

Thierry Wizman, a global FX and rates strategist at Macquarie, commented, “The positive shift in U.S. stocks could be driven by two factors: falling gold and oil prices, and a stable U.S. dollar, rather than its rise.

Firstly, the fears of a war spreading in the Middle East have subsided with neither side likely to escalate to a full-scale conflict, reverting to a shadow war. This might be why U.S. stocks moved higher today.”

U.S. Stocks

Fundamental Analysis:

Major technology stocks mostly advanced with Amazon and Google gaining over 1%.

Apple, Microsoft, and Meta saw modest gains, while Netflix slightly declined. Tesla fell more than 3%, marking its seventh consecutive trading day decline, which ties the longest losing streak since the company’s U.S. IPO.

Semiconductor stocks saw broad gains; ARM surged over 6%, Nvidia over 4%, and Micron Technology over 2%.

The precious metals sector, however, led the declines with gold mining companies taking a hit; Gold Mining fell over 9%, and Harmony Gold and Gold Resource each dropped more than 6%.

Chinese concept stocks mostly rose, with the Nasdaq Golden Dragon China Index up 2.34%.

Pinduoduo soared over 9%, Bilibili over 7%, and JD.com, iQIYI, and NIO each over 5%.

Tencent Music rose over 3%, while Vipshop, Weibo, Alibaba, and Baidu each gained over 2%.

Manbang and NetEase rose over 1%, and Futu Holdings saw slight gains. Li Auto, however, fell more than 5%.

Technical Analysis: 

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

Market Trends:

  • Nasdaq rose 169.30 points or 1.11%, closing at 15,451.31.
  • Dow increased by 253.58 points or 0.67%, to 38,239.98.
  • S&P 500 went up by 43.37 points or 0.87%, to 5,010.60.

Hong Kong Stock Market

Fundamental Analysis:

This week, Hong Kong’s three major indices experienced another round of gains.

In the market, tech stocks saw significant increases, with Meituan and JD.com rising over 6%, Tencent and Xiaomi about 3%, and Alibaba more than 2%.

The real estate trust sector benefited from the inclusion of H-REITs in the Shanghai-Shenzhen-Hong Kong Stock Connect, with Link REIT increasing over 2%.

Mobile gaming stocks were among the top performers, with CMGE surging nearly 9%.

The oil sector also strengthened collectively, with Sinopec climbing over 2%.

Spot gold continued to fall, leading to a collective downturn in gold stocks, with China Gold International dropping nearly 4%.

TeaBiotics had a disappointing market debut, plummeting over 35%, and Tianjin Development’s IPO also fell sharply by over 25%.

Gold stocks declined collectively, with China Gold International falling nearly 4%.

According to media reports, the downturn in gold prices relates to several factors. There was a convergence in the direct conflict between Israel and Iran over the past weekend, coupled with selling pressure from profit-taking.

Additionally, Federal Reserve officials, who have been consistently tempering expectations for rate cuts, entered a “quiet period,” making the significant drop in gold prices somewhat expected.

Technical Analysis: 

(Hang Seng Index, 1-day chart)

Market Trends:

  • Hang Seng Index (HSI) rose 1.64%, to 16,782.71.
  • Hang Seng Tech Index (HSTECH) climbed 2.85%, to 3,431.52.
  • Hang Seng China Enterprises Index (HSCEI.) increased 1.85%, to 5,939.12.

FTSE China A50 Index

Fundamental Analysis:

In the morning session, China’s three major A-share indices underwent collective adjustments, experiencing a decline in trading volume.

The defense information technology sector saw significant gains, while precious metals weakened.

In sectoral performance, the defense IT sector recorded substantial increases.

Xingtu Science and Guangha Communications hit the daily limit of 20 cm, while Aowei Communications, Sichuan Creation Electronics, and Aerospace Changfeng also reached trading halts during the session.

The education sector advanced notably, with Kaiyuan Education hitting the daily limit up of 20 cm.

The spatial computing sector strengthened, with Tianrun Technology soaring over 20%.

The new urbanization concept was also active, with Jianyan Design and Tendering Shares hitting the 20 cm daily limit, and Zhongshe Holdings and Zhongheng Design experiencing mid-session trading halts.

Technical Analysis:  

(SSE Composite Index, 1-day chart)

Market Trends:

  • Shanghai Composite Index (SHCOMP) fell 0.41%, to 3,032.13.
  • Shenzhen Component Index (SZCOMP) dropped 0.74%, to 9,170.92.
  • ChiNext Index (CHINEXT) decreased 0.31%, to 1,744.96.
  • SSE Sci-Tech Innovation 50 Index declined 0.78%, to 726.1.

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