U.S. Stocks End New High as Fed Lowers Rates

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Main Content:

1.    Major indexes weekly performance 

2.    U.S stocks weekly wrap 

3.    S&P 500 sector index weekly/month performance 

4.    China/Hong Kong stocks weekly wrap 

5.    Singapore stocks weekly wrap 

6.    Major indexes weekly chart and technical support & resistance levels

U.S.

For the week of Oct 31, major U.S. stock indexes advanced. The technology-heavy Nasdaq Composite(COMP) led the way for the major indexes, boosted by continued outperformance from the mega-cap technology companies benefiting from artificial intelligence spending. The S&P 500 Index(SPX) advanced despite seven of its 11 sectors losing ground. Refer to below major indexes weekly performance.

October month comes to an end, the three major indexes all end new high- SPX has had six-month up in a row, which is remarkable. Refer to below indexes monthly performance.

Key highlights for the week and next:

1.    Q3 earnings season continued to ramp up with over 1/3 of SPX companies reporting results, including five of the so-called Magnificent Seven companies. According to data from FactSet, 64% of S&P 500 companies had reported results as of Friday morning, with 83% posting earnings that beat consensus estimates. Reactions to the week’s Magnificent Seven earnings were mixed, with shares of Microsoft, Apple, and Meta Platforms declining after reporting, while Amazon and Alphabet traded higher. Elsewhere, shares of NVIDIA rose and pushed the chipmaker’s market capitalization over USD 5 trillion midweek, making it the first company to ever cross that threshold. 

2.    High-stakes meeting between Presidents Trump and Xi on 30 Oct in South Korea delivered a welcome easing in trade tensions between the U.S. and China, which reassure markets that this important trade relationship appears to be on a more stable footing. 

3.    Fed lowers interest rate by 25 basis points(0.25%) to 3.75%-4.00%, as was widely expected. But Fed warned investors that they shouldn't take a rate cut in December for granted. This caution prompted a sell-off in bond markets, but while the timing of cuts is uncertain, rates still look to be heading lower. 

SPX sectors in play

Four out of 11 SPX sectors recorded weekly gains. Technology(XLK) and Consumer Discretionary(XLY) led the way up, while consumer staples(XLP) and Materials(XLB) lagged. Refer to below SPX sectors ETF weekly performance table.

Indexes technical levels

All the three major indexes all closed new high. But SPX index was seen profit-taking since hit new high of 6920 on Wednesday. Uptrend is well intact but do watch out short term profit-taking in coming week. Click below three indexes for their weekly charts.

DJI weekly chart

SPX weekly chart

Nasdaq weekly chart

China/HK

Mainland China stock markets ended the week on a mixed note as worries about a growth slowdown outweighed optimism about easing U.S.-China trade tensions. The Shanghai Composite Index(SSE) edged up 0.11% and the blue-chip CSI 300 shed 0.43%. In Hong Kong, the benchmark Hang Seng Index declined 0.97%.

Key highlights for the week and outlook for China/HK:

Concerns about China’s longer-term growth picked up after a recent high-level meeting of the country’s leaders failed to come up with any potent policy support. Following the end of China’s fourth plenum, a four-day conclave of top Communist Party officials, the government pledged to “form an economic development model driven more by domestic demand and powered by consumption,” Bloomberg reported, citing state media. While analysts said Beijing’s emphasis on consumption was positive, it fell short of targeting a specific level of household consumption in the country’s gross domestic product (GDP). China’s household consumption level as a percentage of GDP is currently about 40% versus the global average of 56%, according to World Bank data.

Refer to below Hang Seng Index stocks’ weekly performance table.

Click below for SSE and .HSI weekly chart.

SSE weekly chart

.HSI weekly chart

 

Singapore

The Straits Times Index (STI) edged up 0.14% to close at 4428.62 this week, the index hit intra-week new record of 4478.15 then gave back almost all its weekly gains by profit-taking though weekly up still well intact.

Refer to below STI index stocks’ weekly performance.

Click below for STI weekly chart.

STI weekly chart

Source: Some contents and data excerpted from various public market reports. Please comment to claim copyright ownership of any material, and I will remove it if necessary.