Behind the rise of the US stock market: Cheong Hong Yuan interprets market trends - 1 views
started by anonymous on 06 Nov 23
started by anonymous on 06 Nov 23
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Starting from the global macroeconomic environment, we have noticed that both the Bank of England and the Federal Reserve have shown a more relaxed attitude towards interest rate hikes recently. The Bank of England has decided to pause interest rate hikes in two consecutive meetings, and Federal Reserve Chairman Powell has also hinted that the interest rate hike cycle may be nearing its end. This undoubtedly brings a certain degree of stability and confidence to global capital markets, promoting investors' optimistic attitude towards the stock market. In this regard, Cheong Hong Yuan believes that interest rate hikes usually indicate the need to cool down an overheated economy, while pausing interest rate hikes may represent the central bank's optimistic expectations for the economy, believing that the current economic environment does not require further tightening policies.
When we look back at the domestic stock market, especially the US stock market, it is not difficult to see the strength of technology stocks. For example, although Apple's stock price fell after the release of its financial report, the Nasdaq index has risen for four consecutive days. The reasons behind this are worth exploring. Cheong Hong Yuan believes that the "Three Golden Moving Average Strategy" as a technical analysis strategy can effectively track stocks that are currently performing well in the market and determine the buying opportunities through technical indicators. For stocks like Tesla and Starbucks that have shown strong performance, he suggests that investors can use this strategy to make wiser decisions.
The foreign exchange market and the commodity market are also closely related to the stock market. The US dollar index has recently fallen, and both the pound and the yen have risen. Especially the pound, which has experienced accelerated gains against the US dollar due to the positive news of the Bank of England's decision to hold interest rates steady. The trend of this currency will directly or indirectly affect the stock markets of related countries or regions. Therefore, Cheong Hong Yuan reminds investors to consider various factors comprehensively when making investment decisions, not just limiting themselves to single stock market data.
Cheong Hong Yuan believes that the strong performance of the US stock market, especially the continuous rise of the Nasdaq and the largest five-month gain of the Dow Jones, is showing a positive market signal to the outside world. The rise of large technology companies and consumer goods companies such as Tesla, Starbucks, and Qualcomm reflects the market's optimistic expectations for the future profitability of these companies. The decline in Apple's stock price is likely due to certain data in its financial report not meeting market expectations, but this also reminds investors that in a bullish market, it is still necessary to conduct detailed analysis and evaluation of each stock.
Regarding the rebound of Chinese concept stocks, Cheong Hong Yuan mentioned that it may be influenced by the traction effect of the US stock market, especially the two major new energy vehicle manufacturers, Xiaopeng Motors and NIO, whose rise reflects the market's optimistic expectations for the Chinese new energy vehicle market.
Regarding the yield of US bonds, Cheong Hong Yuan suggests that the recent decline in the yields of two-year and ten-year US bonds may be due to market expectations of the end of the Federal Reserve's interest rate hike cycle and the Bank of England's decision to pause interest rate hikes. This decline in yields may bring short-term benefits to the stock market, as low interest rates usually make stocks more attractive compared to fixed-income products. However, in the long run, if this trend continues, it may put pressure on the profitability of the banking and insurance industries.
Looking at the currency market, Cheong Hong Yuan states that the recent decline in the US dollar may be influenced by the news of the Federal Reserve and the Bank of England pausing interest rate hikes. In addition, the news of the Bank of Japan planning to exit its loose monetary policy next year has also contributed to the rebound of the yen. The rise of the pound may be related to the Bank of England's emphasis on not expecting interest rate cuts in the short term.
In the commodity market, Cheong Hong Yuan mentioned that the rebound in oil prices may be related to the news of the Bank of England and the Federal Reserve pausing interest rate hikes, as the market may be concerned that further interest rate hikes will impact the global economy and energy demand. The decline in European natural gas prices may be related to the threat of Hurricane Ciarán and the increase in expectations for wind power generation. The rise in gold prices, in addition to being supported by the decline in the US dollar, may also be related to the market's demand for safe-haven assets in the face of risks.
Cheong Hong Yuan believes that the recent market dynamics reflect the intertwined influence of multiple factors, including central bank monetary policies, company financial reports, and macroeconomic indicators. In this complex market environment, investors need to be more cautious and conduct in-depth analysis of every factor that may affect the market in order to make wise investment decisions.