The Zhitong Finance App learned that on Thursday, the three major indices closed down. The resignation of Nvidia CEO Wong In-hoon and continued tension in the Middle East dampened market sentiment. Nvidia saw a double-digit decline at the beginning of the market. Meanwhile, part of the capital was turned to Nvidia's rival, and AMD and Broadcom shares both rose by about 5%.
[US Stocks] At the close, the Dow Jones index fell 189.40 points, or 0.36%, to 52297.09 points; the S&P 500 index fell 26.98 points, or 0.35%, to 7592.40 points; the Nasdaq Composite Index fell 100.10 points, or 0.39%, to 25366.09 points. Nvidia (NVDA.US) closed down 4.3%, after falling 13% in the intraday period. Broadcom (AVGO.US) and AMD (AMD.US) rose more than 5.5%, while SK Hynix (SKHY.US) fell 3%. The Nasdaq China Golden Dragon Index closed down 3.1%, while Alibaba (BABA.US) fell 7%.
[European stocks] The German DAX30 index rose 144.29 points, or 0.54%, to 26786.36 points; the UK FTSE 100 index rose 28.09 points, or 0.26%, to 10863.56 points; the French CAC40 index rose 28.49 points, or 0.34%, to 8361.36 points; the European Stoxx 50 index rose 8.36 points, or 0.13%, to 6401.75 points; Spain's IBEX35 index fell 61.63 points, or 0.31%, to report 19966.27 points; Italy's FTSE MIB index fell 124.04 points, or 0.24%, to 51822.50 points.
[Foreign Exchange] The US dollar index, which measures the US dollar against the six major currencies, rose 0.26% on the same day and closed at 103.174 at the end of the foreign exchange market. As of the end of the exchange market in New York, 1 euro was worth 1.1056 US dollars, lower than 1.1091 US dollars on the previous trading day; 1 pound was worth 1.3236 US dollars, lower than 1.3278 US dollars on the previous trading day. 1 US dollar was worth 159.83 yen, lower than 159.86 yen on the previous trading day; 1 US dollar was worth 0.8353 Swiss franc, higher than 0.8331 Swiss franc on the previous trading day; 1 US dollar was worth 1.4260 Canadian dollars, higher than 1.4248 Canadian dollars on the previous trading day; and 1 US dollar was worth 10.0226 SEK, up from 9.9770 on the previous trading day.
[Cryptocurrency] Bitcoin fell more than 3% to 71,365 US dollars as of press release; Ethereum fell more than 2% to 2011.53 US dollars.
[Precious Metals] Spot gold fell 2.76% to $3878.01; spot silver fell 3.12% to $50.061 per ounce.
[Crude oil] Light crude oil futures for December delivery on the New York Mercantile Exchange rose $2.21, or 2.55%, to close at $88.74 a barrel; London Brent crude oil futures for January delivery rose $3.06, to close at $95.82 a barrel, or 3.3%.
[Macro News]
Federal Reserve Daly: Further rate hikes may be necessary to curb inflation. San Francisco Federal Reserve Chairman Daly said on Thursday that further tightening monetary policy may be necessary to reduce inflation because inflationary pressure persists and is not limited to industries directly affected by tariffs or oil prices. She said that more and more companies are informing her that they plan to pass on higher investment costs to consumers, and the willingness of companies to raise prices is growing. Daly said she supports the Fed's decision to raise interest rates in September and keep interest rates unchanged in October. Regarding AI, Daly said that AI infrastructure construction is undoubtedly driving up some prices, but the impact on overall inflation is still moderate, the cost increase is limited, and it has not spread to other fields. She believes that current overall inflation is mainly driven by other factors rather than AI-related products. She is still optimistic about the long-term prospects of AI driving faster productivity growth, but it is still too early to judge when it will be realized. Daly is not on this year's FOMC voting committee.
The US fiscal deficit reached 404 billion US dollars in October, an increase of 42% year-on-year. According to data from the US Treasury Department, the US fiscal deficit reached 404 billion US dollars in the first month of fiscal year 2027 (October 2026), an increase of 42% over the previous year. In the same month, government spending increased 12% year on year to 773 billion US dollars, and tax revenue fell 9% to 369 billion US dollars, of which tariff revenue fell about 39% year on year to 19.2 billion US dollars. Increased spending on military spending, health care, and interest on treasury bonds boosted government spending, while the scale of customs and corporate tax rebates was higher than the same period last year, dragging down tax revenue. The US Treasury Department expects the fiscal deficit to rise slightly to about 2.2 trillion US dollars this fiscal year. The US fiscal deficit in the previous fiscal year was 1.99 trillion US dollars, accounting for about 6% of GDP.
Goulsby: US inflation is at risk and should be prevented from worsening further. According to reports, Chicago Federal Reserve Chairman Goulsby of the Federal Reserve said that he originally hoped that as the impact of tariffs gradually subsided and oil prices fell, US inflation would cool down significantly, but this expectation has not yet been realized. The CPI exceeded expectations in October. In order to rise for the second month in a row, Goulsby said that the US is in a “dangerous moment” in the inflation situation and should be cautious to prevent inflation from worsening further. Goulsby pointed out that there is still ongoing price pressure in the CPI sector, such as services and healthcare. These pressures have nothing to do with tariffs or oil prices. He said that the US is gradually entering a stage in history where it is difficult for central banks to contain inflation. Goulsby said that the Federal Reserve is currently trying to differentiate between two types of factors driving inflation to continue to rise: supply-side shocks such as tariffs and high oil prices that have continued to exceed expectations, and demand-side overheating caused by large-scale construction of data centers. He pointed out that AI-related inflation has not spread to the overall economy. Currently, it is mainly concentrated in AI, technology and related industries, but the Federal Reserve is closely monitoring whether it spreads to other fields. If overheating demand due to data center construction starts to affect the overall economy, it will become a problem. He also said that the recently elected governor of the Democratic Party proposed suspending data center construction, which is currently not directly related to the Federal Reserve's inflation work.
The yen fell below the 160 mark, and the risk of Bank of Japan intervention intensified. The yen fell below the 160 mark against the US dollar, the first time since September, and weakened for the third consecutive trading day. Rising US Treasury yields and rising expectations of the Federal Reserve's interest rate hike have strengthened the dollar. The spread between the US and Japan exceeds 250 basis points, increasing the pressure on the yen to depreciate. Japan's Ministry of Finance official in charge of foreign exchange affairs, Jun Mimura, said on Thursday that the yen exchange rate has fluctuated “too fast” recently, and mentioned previous intervention in the foreign exchange market; Japanese finance minister Katayama Satsuki and US Treasury Secretary Bezent have both previously sent signals to intervene again in the foreign exchange market if necessary. Previously, USD/JPY fell rapidly by more than 70 points against the Japanese yen to 159.30, triggering market speculation about intervention by the Japanese authorities, and has now rebounded to 159.72. Japan interfered in the foreign exchange market three times this summer, using a total of 15.4 trillion yen (about 96.4 billion US dollars).
[Individual Stock News]
Nvidia's forward price-earnings ratio fell to a 14-year low, and the stock price fell more than 30% from its all-time high. The stock price of Nvidia (NVDA.US) recently fell sharply, and the forward price-earnings ratio has dropped to about 12 times, the lowest level since 2012. After Hwang In-hoon's resignation, Nvidia's stock price fell more than 4% on Thursday. The cumulative decline this week was about 11%, down more than 30% from the all-time high set on October 6. In addition to management changes, the market is also concerned that AI data center construction may slow down. Nvidia's chief financial officer Colette Kress is currently serving as interim CEO, and the company is looking for an official successor. Analysts are still maintaining expectations for Nvidia's strong profit growth, and it is expected that demand for chips will continue to exceed supply. The market expects Nvidia's October quarter revenue to increase 92% year over year, net profit to exceed 60 billion US dollars, up 89% year on year. Nvidia will release its earnings report next Tuesday. Investors will focus on Kress's statement on the company's future performance prospects. The guidelines may receive more attention than the financial report itself.
A Microsoft cloud service malfunction has also been reported by AWS and Google. According to data from the fault tracking website Downdetector, Microsoft (MSFT.US) experienced a widespread service failure on Thursday EST, affecting thousands of users in multiple regions. The failure began shortly before 2 a.m. Beijing time on the 13th, affecting Microsoft 365 services and Outlook. Meanwhile, users of Amazon Cloud Services (AWS) and Google (GOOG.US) have also reported service outages on the website. A Microsoft spokesperson said, “We have noticed the relevant situation and are currently investigating the Microsoft 365 service failure reported by users. The problem is mainly focused on Exchange Online.” Microsoft initially posted an article on its “Microsoft 365 Status” account on its social networking platform that the connectivity issue may be caused by “excessive load in multiple regions” of the infrastructure. Subsequently, Microsoft determined that the increase in load was due to “the unexpected unavailability of some servers, leading to increased pressure on the rest of the infrastructure.”
Demand for semiconductors drove Applied Materials' sales and profits to grow. Applied Materials (AMAT.US) achieved significant profit and sales growth in the fourth fiscal quarter, thanks to demand for semiconductors driven by artificial intelligence. The company's profit for the fourth fiscal quarter was US$2.72 billion, or US$3.40 per share; profit for the same period last year was US$1.90 billion, or US$2.38 per share. Excluding certain one-off items, adjusted earnings per share were $4.16, higher than analysts' previous expectations of $4.06. Revenue increased 53% to $10.41 billion, exceeding analysts' forecasts of $10.3 billion. Gary Dixon, CEO of Applied Materials, said the company's semiconductor systems business is expected to grow by more than 40% this year. In the most recent quarter, sales in this business segment surged 64% to nearly $8 billion. For the first quarter of the new fiscal year, Applied Materials expects revenue to reach $11.1 billion (fluctuating $500 million); adjusted earnings per share are expected to be $4.35 (fluctuating 20 cents).
According to reports, the fastest progress in merger negotiations between SpaceX and Tesla was announced in December. According to media reports, quoting people familiar with the matter, the merger negotiations between SpaceX (SPCX.US) and Tesla (TSLA.US) are progressing, and the boards and advisors of the two sides are discussing issues such as the terms of the deal and the post-merger governance structure. The two companies may announce the merger in December at the earliest, but the possibility of delaying the announcement until early 2027 was also discussed. If realized, this merger will be one of the largest deals in history, integrating electric vehicles, energy storage batteries, rocket and satellite businesses. Negotiations still face many obstacles, including how to isolate some of Tesla's overseas operations, as well as national security issues involved in SpaceX's contract with the US Department of Defense. The boards of directors of the two companies have previously set up a special committee of independent directors to study the merger.