Traders work on the trading floor of the New York Stock Exchange (NYSE) on October 30, 2023.
Spencer Pratt | Getty Images News | Getty Images
This report comes from today’s CNBC Daily Open, our new international markets newsletter. CNBC Daily Open keeps investors updated on everything they need to know, no matter where they are. Like what you see?You can subscribe here.
What you need to know today
Recover damages
U.S. stocks rose on Monday after the S&P 500 fell into retracement territory last week. The Dow Jones Industrial Average had its best day since June. Asia-Pacific stocks were mostly lower on Tuesday. China’s Shanghai Composite Index fell 0.38% Manufacturing activity in October I didn’t think about the contract. However, Japan’s Nikkei 225 index rose 0.22% after the Bank of Japan announced its monetary policy decision.
Bank of Japan loosens controls
The Bank of Japan announced that it will allow the yield curve control policy to be more flexible, using the 1% cap on government 10-year bonds “as a reference.” However, the central bank kept its short-term policy rate unchanged at -0.1%. The Bank of Japan also raised Japan’s inflation outlook, predicting that core CPI will reach 2.8% and 1.7% in fiscal 2024 and 2025 respectively.
Say goodbye to bad memories
Samsung Electronics’ third-quarter operating profit was 2.43 trillion won (US$1.79 billion). Compared with the same period last year, this was a decrease of 77.6%. But compared with the previous quarter, the figure increased 262.6% and was higher than expected, indicating that the company may be moving away from a glut of memory chips that has hollowed out profits.
Tesla’s bumpy road
Panasonic said Tesla stock price fell nearly 5% in response Reduce battery production Due to weak demand for Tesla vehicles. Earlier this month, Tesla CEO Elon Musk warned shareholders that high interest rates were forcing the company to keep prices low and eroding consumers’ spending power. The electric car maker’s shares have fallen more than 18% since Musk issued the warning.
(PRO) Monetary policy mistake?
The Fed is widely expected to keep interest rates on hold at the end of its two-day meeting on Wednesday. The central bank is also expected to reiterate its statement that “interest rates will remain at high levels for a long time.” But the Fed has been known to miss the mark when it comes to its monetary policy forecasts, writes CNBC’s Jeff Cox .
bottom line
after a rough week Stocks started the week rebounding on rising inflation and disappointing earnings.
The Dow Jones Industrial Average broke a three-day losing streak and rose 1.58%, its best single-day performance since June 2. The S&P 500 rose 1.2%, its best day since August 29 and ending a three-day losing streak. The Nasdaq rose 1.16%, rising for the second consecutive day.
Technology stocks led sharp gains Monday. In fact, Fundstrat’s Tom Lee believes this group of tech giants could not only push the S&P higher on the day, but could do so through the end of the year.
Other analysts also see the tide turning. “Investors are finally feeling more confident, and maybe we’ve digested enough bad news, and that’s reflected in today’s market strength,” said Art Hogan, chief market strategist at B. Riley Financial. .”
The end of the Federal Reserve meeting on Wednesday – where the central bank is expected to keep interest rates on hold – could also provide fresh impetus for stocks. Hogan believes that if the Fed does keep rates at the same level, it “could be a sign that the rate hike cycle is over,” which could “stop the parabolic rise we’ve seen in Treasury yields.”.
In addition, news that the U.S. Treasury Department will borrow less than expected in the fourth quarter may soothe investors’ concerns about rising bond yields. A drop in Treasury yields — or at least a pause in their rise — lowers borrowing costs and gives the economy and financial markets more breathing room.
However, it may be too early to relax the alert. Ari Wald, head of technical analysis at Oppenheimer, wrote that the S&P’s “correction from July is not over yet.” Wald believes the broader market index will fall to 4,050 points – about 100 points below Monday’s closing price – before reversing its losses.
But Mike Wilson, chief U.S. equity strategist at Morgan Stanley, said the S&P might not even correct itself. Conversely, Wilson, one of Wall Street’s most pessimistic strategists, believes the S&P will fall to 3,900 points by the end of the year, according to a CNBC Market Strategist Survey.
The divergence of opinion clouds the outlook for the future, but ironically, it does make one thing clear: The market is increasingly unstable. Investors would be wise to guard against more severe fluctuations.
Svlook
