(1) Global markets experience "Black Monday" Japan led the decline in global stock markets
Global stock markets suffered a "Black Monday". First, the Japan stock market led the decline, with the Nikkei 225 index closing down 12%, falling more than 13% at one point during the session, and losing nearly a year's gains in three days; Japan's Topix index closed down 12%, its biggest one-day drop since 1987, and the circuit breaker mechanism was triggered several times during the session. At the same time, the yen again pulled wildly, rising above the 144 mark and reaching its highest level since mid-January. As a result, Korea's two major stock indexes plummeted and triggered a circuit breaker, with Korea's KOSPI index closing down 8.8%, its biggest drop since 2008. In addition, the Singapore Straits Index fell more than 4%, Australia's S&P 200 closed down 3.7% and India closed down 2.74%. The MSCI Emerging Markets Index fell 4.2%, its biggest one-day drop since February 2022. Then, the stock market crash that began in Asia that day spread to Europe and the United States. The Euro Stoxx 600 index closed down 2.17%, falling more than 3% at one point. U.S. stocks also closed sharply lower on Monday, with the Dow plunging more than 1,000 points, the Nasdaq falling 3.4%, and the S&P 500 posting its biggest one-day drop since 2022. The CBOE Volatility Index (VIX), which measures the level of panic in the market, surged above 53, its highest level since the pandemic began in 2020.
DBS Tang Chee Kin: The recent sharp decline in Japanese stocks is mainly due to the retreat of arbitrage and concerns about the economy. Japan's economy has basically entered a state of initial recession. If normal operations continue, other central banks may have to continue easing, but Japan is different. After 2008, Japan's base currency rose sixfold, but M2 increased by only 73%, and the currency turnover rate was strangely low. This is mainly because the money does not enter the real economy, but flows into the financial market, investing in stocks and bonds in Japan and the world, which is a typical carry trade. So it's not that Japan has no money to stimulate the economy, but that money has invested in other assets. The Bank of Japan has long been aware of the problem. If we want to reverse the efficiency of the use of funds, we can only raise interest rates and shrink the balance sheet, so that the carry trade will retreat and the funds will flow back to Japan financial institutions. The reasons for the recent continuous decline in U.S. stocks are: the risk of global conflict still exists; The United States election is uncertain; United States economic data for July was poor. In particular, in the labor market, the preliminary number of new non-farm jobs in July was only 114,000, and the unemployment rate continued to rise to 4.3%. Investors are worried about a hard landing for the United States economy.
Guo Feng, chief investment adviser of Northeast Securities: The liquidation of the yen carry trade led to a sharp decline in the Japan stock market, the attractiveness of RMB assets rebounded, and the resilience of A-shares and Hong Kong stocks increased.
(2) Fed's Goolsbee: No signs of recession The Fed's role is not to react to a single month's weak data
The Fed's Goolsbee said last night that the Fed has been tightening. Such strict measures are only necessary if there is a fear that the economy will overheat; The current data does not show signs of overheating in the economy. United States jobs data came in lower than expected, but it has not yet shown signs of a recession. In the face of the US stock market plunge, Goolsbee reiterated that the Fed's role is not to react to a single month's weak employment data, adding that market volatility is much higher than the Fed's actions. San Francisco Fed President Daly said overnight that the labor market was weakening and hinted that the Fed should start cutting interest rates in the coming quarters, but she stressed that the job market remains solid and will not fall off a cliff. Goldman Sachs chief economist Jan Hatzius and his team on Sunday raised the probability of a recession in the United States from 10% to 25% in the next year, but they still believe that the risk of a recession is limited, and even if unemployment rises, there are multiple reasons not to worry about a recession. They argue that the United States economy generally looks "still good," with no major financial imbalances, and that the Fed has plenty of room to cut rates and act quickly if necessary. They expect the Fed to cut rates by 25 basis points in September, November and December. In contrast, JPMorgan Chase & Co. and Citigroup adjusted their forecasts, expecting policymakers to cut rates by 50 basis points in September.
DBS Deng Zhijian: The probability of recession in United States has not been lower than 50% since October last year, and the probability has risen for two consecutive months to 55.83% in June. I don't think the United States economy will recession for the time being. Macroeconomic data is starting to weaken. The manufacturing and services PMIs were below 50, employment data was weak, and consumer confidence fell. However, corporate earnings were not only better than expected, but earnings actually increased by an average of 11% year-on-year, the largest increase in the last four quarters. It is believed that the Fed's 25 basis point rate cut in September is a sure thing, and although the probability of a 50 basis point rate cut has soared to 70%, the August data includes the annual summer vacation consumption season, which remains to be seen to fully judge. The current market plunge is a bit of an overreaction.
Guo Feng, Chief Investment Adviser of Northeast Securities: "Sam" law indicates that there is a risk of recession in United States, and there is an expectation of recession in U.S. stock trading. China's proactive policies continue to be introduced, and the economy has momentum to stabilize. At present, the valuation advantages of A-shares and Hong Kong stocks are obvious, and there are signs of capital attention in policy-supported industries such as innovative drugs, cultural tourism, and pension.
(3) AI revenue generation accelerates, software giant Palantir performs well with expectations After-hours stock price surges led to a rebound in many technology stocks
Shares of Palantir Technologies, a big data analytics software giant known as the "AI bull stock", rose 19% in after-hours trading this morning. Previously, the company reported strong second-quarter results, with revenue in the second quarter up 27% and $307 million in commercial revenue, up 33% year-over-year, due to continued strong demand for Palantir's AI software products from government agencies and major enterprises around the world. Net income unexpectedly rose 20% to $134 million, well above the consensus estimate of $82.8 million. Adjusted EBITDA was $262 million, up 39% year-over-year. At the same time, Palantir also raised its annual profit outlook significantly more than expected, unexpectedly raising its total revenue guidance range for 2024 to between $2.74 billion and $2.75 billion, higher than Wall Street's consensus estimate of around $2.7 billion. It also raised its adjusted operating profit outlook for this year sharply to $966 million to $974 million, compared with analysts' consensus expectations of around $883 million. The excellent performance boosted a number of AI-related hot technology stocks to rebound quickly after hours, with Nvidia rebounding 3% in after-hours trading, Broadcom rebounding 2.7%, Supermicro Computer rebounding 2.5%, and Dell rebounding 1.73%.
Commentator Xu Ge: There are two reasons behind the after-hours surge in Palantir's stock price after the release of its results, one is the tension in the Middle East, which has led to an increase in the marginal effect of Palantir's use in the government and the military, and the other is the actual growth in performance brought by AI, with the revenue of the commercial sector reaching $307 million in the second quarter, a significant increase of 33% year-on-year. In fact, in addition to the market's harsh requirements for the performance of AI leading stocks, it is also returning to objectivity and rationality, although the stock price of the technology giant Seven Sisters fell overnight, Meta is still more resistant, and it is also because its revenue and profit in the second quarter have indeed increased significantly. There are irrational factors in this round of global market decline, but at the end of the session, we saw that the decline in gold and U.S. stocks has converged greatly, indicating that the market repair function is intact.
Ying Yanfang, investment consultant of Orient Securities: The overall performance of AI-assisted software giants exceeded expectations, and the sentiment has improved, driving the rebound of the sector.
(4) AbbVie shares hit a record high last Friday against the intraday trend
AbbVie shares hit a record high on Black Friday last week, and even though it fell 2.56% with the broader market yesterday, the stock price has risen 11.3% in the last month. AbbVie delivered a solid second-quarter earnings report on July 25, with strong revenue growth across all lines of business and revenue growth across all lines of business despite lower-than-expected earnings per share figures. Revenue growth is accompanied by an increase in operating leverage, which is a huge bullish signal for investors and demonstrates management's ability to drive growth efficiently. The long-term trend also looks favorable, with AbbVie having a strong presence in all segments that are poised for solid long-term growth. The company's total revenue in the first half of the year was US$26.772 billion, a year-on-year increase of 3.7%, and R&D investment was US$3.887 billion. In the field of autoimmunity, Humira (adalimumab), which has been the "king of drugs" for many years, fell to $5.084 billion with a decline rate of about 32%. Skyrizi (risenkizumab) and Rinvoq (upadatinib), which succeeded Humira, maintained strong growth, with the former generating revenue of US$4.735 billion, a year-on-year increase of 46.6%, and the latter generating revenue of US$2.523 billion, a year-on-year increase of 60.4%. If this growth rate continues, Skyrizi is expected to break the $10 billion "mark" by the end of the year. The company raised its full-year EPS guidance by $0.1 to $10.71-$10.91.
DBS Bank Deng Zhijian: Historical experience shows that the pharmaceutical sector is more resilient to the financial crisis. AbbVie, the world's largest biotech company, hit a new high last week, but it seems that earnings have fallen by 32%, why can the stock rise against the market? AbbVie announced last week that it had completed the acquisition of Cerevel Therapeutics, a biotechnology company, and its robust neuroscience pipeline for an all-cash acquisition of US$8.7 billion. Through this acquisition, AbbVie has access to the best psychiatric and neurological drugs on the market, with potential for a wide range of conditions, including schizophrenia, Parkinson's disease (PD) and mood disorders. The acquisition complements AbbVie's neuroscience portfolio, adding a portfolio of potentially best-in-class assets that have the potential to transform the standard of care for psychiatric and neurological conditions where patients still have significant unmet needs.
Guo Feng, Chief Investment Consultant of Northeast Securities: The valuation of A-share innovative drug companies is at the bottom of history and has allocation value.
(5) The strongest humanoid robot on the surface? The second generation of Figure will be released today
Figure has unveiled the Figure 02 trailer and will officially unveil the product today. Judging from the teaser video, Figure began to create a humanized image that is more inclined to the consumer market to expand the C-end market; The joints, actuators, humanoid feet and dexterous hands of the new humanoid robot ushered in a big upgrade, the arm joint actuator A2 torque is 50NM, the corresponding maximum angle range of joint movement is 148°, and the lower limb leg joint shows 2 rotary joint actuators: one of which is 150NM torque is used in the thigh near the hip joint, and the maximum angle range of joint movement is 195°; The head and body have a lot more freedom, and the legs and torso can be rotated at least 180°. In addition, the new composite materials used in Figure 02 provide motion cushioning while reducing weight and enhancing heat dissipation. The lattice black skin of the hand is expected to integrate tactile sensors, which will greatly improve the robot's tactile perception, while the increased friction will help to grasp and manipulate various objects. At the same time, the overall design of its fingers is more natural and close to the hands of normal people, and the flexibility of the fingers is higher. Figure announced in early March that it had raised about $675 million in funding from giants such as Amazon founder Bezos, Nvidia, OpenAI and Microsoft, valuing its company at $2.6 billion. Its investors also include Intel's venture capital arm LG Innotek, Samsung's investment group, venture capital firm Parkway Venture Capital, Align Ventures and Mu Toujie's ARK fund.
DBS Deng Zhijian: The development of intelligent robots is only in the early learning stage, and it is mainly industrial or commercial robots for the time being, and household robots have not yet been officially commercialized, but this is definitely an important goal for future development. A number of semiconductor and AI-related industry leaders have begun to invest in Figure. It can be said that the technology involved in a humanoid household robot involves almost all different technology sub-industries. For technology to be implemented in daily life and to obtain benefits, humanoid intelligent robots are crucial.
Guo Feng, chief investment adviser of Northeast Securities: The high-end equipment boom and policy support, the A-share humanoid robot sector is still the focus of current institutions.
(This article is from Yicai)
![China electrical software design industry market status survey and development prospect research report[fig]](data:image/gif;base64,R0lGODlhAQABAIAAAP///wAAACwAAAAAAQABAAACAkQBADs=)