Edited by: Du Yu
On June 28, local time, the three major U.S. stock indexes collectively closed down, with the Dow falling 0.12%, up 3.79% in the first half of the year; The Nasdaq fell 0.71%, up 18.13% in the first half of the year; The S&P 500 fell 0.4% and rose 14.48% in the first half of the year.
Most of the popular technology stocks fell, with Amazon and Meta falling more than 2%, and Apple, Google, and Microsoft falling more than 1%. Footwear and clothing brands, computer hardware, and solar energy sectors fell first, with First Solar falling more than 9%, Supermicro Computer falling nearly 8%, and Dell Technologies, Western Digital, and Crocs falling more than 1%. Coking coal, steel, real estate, and diversified banking sectors rose, with Century Aluminum up more than 5%, Wells Fargo and Citigroup up more than 3%, and U.S. Steel and Boston Properties up more than 2%.
Trump's media tech opened higher and closed lower by more than 10%, and after the election debate, Biden's performance (stuttering, confused thinking) excited traders, and a large influx of retail investors sent the stock to a surge in trading volume.
Nike's share price fell 19.99%, and its market value evaporated by 28.4 billion US dollars (about 206.3 billion yuan), after announcing full-year guidance that fell short of expectations.
On June 27, local time, Nike Inc. released its financial results for the fourth quarter and full year of fiscal year 2024 ended May 31, 2024.
According to the financial report, Nike Group achieved revenue of $12.606 billion in the fourth fiscal quarter, lower than market expectations and down 2% year-on-year; The net profit was US$1.5 billion, exceeding market expectations and increasing by 45% year-on-year; Earnings per share were $0.99, up 48% year-over-year, beating market expectations.
In fiscal year 2024, Nike Group achieved revenue of $51.362 billion, flat year-on-year, and net profit of $5.77 billion, up 12% year-on-year.
Nike Greater China achieved revenue of $1.863 billion in the fourth fiscal quarter, a year-on-year increase of 3%, higher than market expectations. In fiscal year 2024, revenue of $7.545 billion was achieved, an increase of 4% year-over-year, achieving seven consecutive quarters of positive growth. Among them, the footwear and apparel and equipment business had the lowest growth rate.
Nike Greater China EBIT for the fourth quarter was $548 million, below market expectations and up 4% year-over-year. Greater China EBIT for fiscal 2024 was US$2,309 million, up 1% year-over-year.
Wind data shows that this is Nike's slowest annual sales growth since 2010, excluding the pandemic.
On the evening of February 15, U.S. time, Nike CEO John Donahoe told employees in a company-wide email that the company would lay off 2% of its workforce, and the layoffs are not expected to affect store employees, distribution center employees, and employees in its innovation team.
As of the end of May 2023, Nike has a total of 83,700 employees, which means that more than 1,600 employees will be laid off.
CEO John Donahoe has been at the helm of Nike since January 2020, and the company's shares have significantly underperformed the S&P 500 large-cap and retail ETF XRT's gains of 69% and 67% over the same period. In the face of the gloomy outlook from the global sporting goods giant, major financial institutions on Wall Street have downgraded Nike stock.
Analysts at Morgan Stanley and Stifford have been even more blunt about the ability and strategy of the company's management. Now, the Nike leader, who once held a top position at eBay, is under pressure, and his leadership is now being questioned by Wall Street analysts and investors.
Image source: Visual China-VCG211300009287
Popular Chinese concept stocks fell, and the Nasdaq China Golden Dragon Index fell 1.02%, down 2.80% this week, and 11.34% in the first half of the year. Weilai fell more than 5%, Xiaopeng Motors fell more than 4%, Bilibili and Manbang fell more than 3%, Li Auto fell more than 2%, JD.com and Vipshop fell more than 1%, and Baidu, Weibo, NetEase, Alibaba, and Futu Holdings fell slightly. iQiyi rose more than 1%, and Pinduoduo and Tencent Music rose slightly.
On June 28, local time, the Federal Reserve announced its most important inflation indicator: the core PCE price index in the United States in May increased by 2.6% year-on-year, a new low in more than three years since March 2021, weaker than the previous value of 2.8%, and other indicators are in line with market expectations for cooling inflation.
Traders are still betting about 65% on a rate cut by the Fed in September, with two rate cuts most likely this year. The final reading of consumer confidence at the University of Michigan in June rebounded from the preliminary value, and the one-year inflation forecast fell to 3%, which dragged the dollar and Treasury yields lower in the short term.
But Bank of America believes the Fed cut interest rates for the first time in December, in line with the outlook of most Fed officials. San Francisco Fed President Daly said that PCE data shows that monetary policy is working, and it is not yet possible to judge the timing of interest rate cuts.
Morgan Stanley believes that both the Fed and the ECB are likely to cut interest rates in September, as key data further points to cooling inflation in the US and the eurozone. Inflation did slow slightly in France and Spain in June, with Italy edging higher.
San Francisco Fed President Daly said the latest inflation data shows that monetary policy is working, but it is too early to tell when it is appropriate to cut interest rates.
"It's hard to imagine that monetary policy doesn't work anywhere, that our economic growth is slowing, that spending is slowing, that the labor market is slowing, that inflation is coming down, and that's exactly what monetary policy does," Daly said in an interview with the media. ”
Looking ahead to monetary policy developments, Daly noted that the Fed will continue to base its decisions on economic data, and policymakers will have to keep interest rates high for longer if inflation declines less than expected.
The Fed has been on hold since July last year, keeping the target range for the federal funds rate at 5.25% to 5.50%, the highest level in more than 20 years.
"On the other hand, if inflation comes down at the same pace as it did at the end of last year, and the labor market stays the same or there is a recession, then we can adjust policy to deal with that," Daley said. She added that it was too early to tell.
Daly has voting rights on monetary policy this year. She warned on Monday that the U.S. labor market is approaching an inflection point, and that a further slowdown could mean higher unemployment as companies not only adjust job openings, but also reduce real jobs.
Thomas Martin, senior portfolio manager at Globalt, said U.S. President Joe Biden's first debate with his opponent Trump on Thursday weighed on the stock market as Biden underperformed. "People are thinking about what is going to happen in the presidential election. Thus, in the wake of the debate, uncertainty has increased rather than decreased. ”
Biden recently said that although the debate performance is indeed poor, he will not withdraw from the presidential election in November and will continue to defend democracy; As he gets older, he may face some physical or cognitive challenges, but he claims that he is up to the task of serving another four years in the White House.
Libby Cantrill of Pacific Investment Management noted: "There was nothing commendable about Biden's performance in the debate with Trump last night. And for the markets, the biggest takeaway from last night was that the deficit would remain high and tariffs could rise, especially if Trump is elected. The question is when these factors will be priced in by the market. ”
JPMorgan's Marko Kolanovic said the S&P 500 could fall in the coming months due to headwinds such as a slowdown and downward earnings revisions, and the stock index is poised to fall to 4,200 points by the end of the year, down about 23% from Thursday's close.
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