Financial Daily: The Fed remains on hold, US stocks opened higher but closed lower, with mixed performance across the three major indices! Both oil and gold prices rose; how will global markets respond?

- Focus

– Fed Chairman Powell stated that the Fed can wait and observe how the impact of the war on inflation evolves, and no immediate action is necessary.

– The financial leaders of the G7 major economies stated they are prepared to take "all necessary measures" to maintain stability in the energy markets and limit the ripple effects of recent market volatility on the broader economy.

– The Iranian Foreign Ministry stated that Iran has its own clear position and demands, and has not entered into negotiations with the United States.

– Trump intends to call on Arab nations to cover the costs of the U.S. military actions against Iran.

Content compiled by the 'Harbor Family Office' under Henry Group. It does not constitute any investment or trading advice. Stay tuned.

- Stock Market

[U.S. Market] U.S. stocks opened higher but closed lower, with mixed performance across the three major indices.

On Monday, Federal Reserve Chair Powell indicated that the Fed does not need to act at this time, providing some support to the market with this dovish signal. However, military conflicts in the Middle East continue to escalate, with President Trump warning Iran that if it does not keep the Strait of Hormuz open, the U.S. will destroy its energy facilities and oil wells. Under this pressure, U.S. stocks reversed early gains, with both the S&P 500 and Nasdaq Composite closing lower.

At the close, the S&P 500 Index fell 0.39% to 6,343.72 points; the Nasdaq Composite Index declined 0.73% to 20,794.641 points; and the Dow Jones Industrial Average rose 0.11% to 45,216.14 points. The VIX Volatility Index dropped 1.42% to 30.61 points. Most sector index ETFs moved lower, with Semiconductor ETF falling 3.13%, and the Global Airlines ETF dropping more than 2%.

Technology stocks broadly declined significantly, with the U.S. Tech Seven Giants Index falling 0.35%. Among them, Meta gained 2.03%, Google A fell 0.31%, Amazon rose 0.81%, while NVIDIA and Tesla both dropped over 1%. The Nasdaq Golden Dragon China Index slipped 0.36% to 6,569.63 points. Among popular Chinese stocks, Pony AI plummeted another 7%, Xiaomi fell 2.16%, Tencent dropped 1.85%, Baidu declined 1.41%, and Alibaba slid 0.58%. On the individual stock front, Circle's shares fell 4.04%, Blackstone Group rose 3.3%, and Taiwan Semiconductor fell nearly 3.2%.

[European Market] Major European national indices generally closed higher on Monday.

Major European national indices generally closed higher on Monday. At the close, the pan-European STOXX 600 Index rose 0.94% to 580.73 points, and the pan-European STOXX 50 Index gained 0.65% to 5,541.79 points, led by Ferrari which surged nearly 4.2%, TotalEnergies climbed 3.22%, Danone, SAP, and Iberdrola all rose over 3.1%.

Germany's DAX 30 Index rose 1.18% to 22,562.88 points; France's CAC 40 Index increased 0.92% to 7,772.45 points; and the UK's FTSE 100 Index advanced 1.61% to 10,127.96 points.

[Asian Markets] Asian stock markets generally fell on Monday, with South Korea's main index dropping nearly 3%.

Asian stock markets generally declined on Monday, with South Korea's main index falling nearly 3%. By the close, Japan's Nikkei 225 Index dropped 2.79% to 51,885.85 points, and Japan's TOPIX Index fell 2.94% to 3,542.34 points. The KOSPI Index in South Korea closed down 2.97% at 5,277.30 points.

[Hong Kong Market] Hong Kong’s three major indices all closed lower, with the Hang Seng Tech Index falling more than 1.8%.

Hong Kong stocks opened lower and closed weaker on Monday, with the three major indices declining, and the Hang Seng Tech Index falling over 1.8%. By the close, the Hang Seng Index fell 0.81% to 24,750.79 points; the Hang Seng Tech Index dropped 1.84% to 4,690.08 points; and the Hang Seng China Enterprises Index declined by 0.65% to 8,399.12 points. In terms of sectors, tech stocks broadly weakened, with Tencent and Baidu both dropping over 2%; insurance stocks retreated, with China Taiping falling over 4%, and New China Life Insurance closing down nearly 4%; home appliance stocks performed poorly, with Hisense Home Appliance Group plunging 6.43%, Haier Smart Home dropping 5.3%, and Midea Group falling over 3.5%. On the other hand, aluminum stocks showed significant strength due to Middle East conflicts impacting several aluminum smelting facilities, with Innovate Holdings surging 8.53%, and Aluminum Corporation of China and Nanshan Aluminum International rising over 7%. Gold steadily rebounded, driving gold stocks higher, with Chifeng Gold climbing over 10%, and Lingbao Gold up 7.26%.

[A-Share Market] A-shares exhibited a recovery after an initial decline, with mixed performances among the three major indices.

On Monday, A-shares overall showed a recovery trend after dipping earlier in the day, with the Shanghai Composite Index turning positive after midday, and mixed performances among the three major indices. By the close, the Shanghai Composite Index rose 0.24% to 3,923.29 points, the Shenzhen Component Index fell 0.25% to 13,726.19 points, and the ChiNext Index declined 0.68% to 3,273.36 points. Sector-wise, the aluminum industry chain was notably strong, with multiple stocks including Liyuan Shares, Minfa Aluminum, and Jiangshun Technology hitting their daily trading limits. Non-ferrous metal stocks widely surged, with Tianli Composite, Xinrui Shares, and Yizhong Resources jumping over 10%, and more than 20 stocks rising over 5%. The innovative drug sector continued its upward trend, with 3SBio surging 13.87%, and Double-Crane Pharmaceuticals hitting its limit-up. Meanwhile, electric power stocks led the declines, with photovoltaic, lithium battery, and wind energy sectors weakening.

– Bonds

[US Bonds] US Treasury yields moved lower.

US Treasury prices rebounded following dovish remarks from Powell, with yields falling. In late New York trading, the yield on the US 10-year Treasury note dropped by 8.95 basis points to 4.3383%, while the yield on the 2-year Treasury note fell by 9.22 basis points to 3.8197%.

[Non-US Bond Markets] European government bond yields generally declined.

European government bond yields broadly followed the downward trend of US Treasuries on Monday. By the end of European trading hours, Germany's 10-year government bond yield fell by 5.9 basis points to 3.035%. The UK 10-year government bond yield dropped by 4 basis points to 4.935%, while France's 10-year government bond yield slid by 6.6 basis points to 3.769%.

[China Bond Market] China’s government bond futures strengthened across the board on Monday.

China’s government bond futures strengthened across the board on Monday. By the close, the 30-year main contract rose by 0.38%, the 10-year main contract increased by 0.15%, the 5-year main contract gained 0.10%, and the 2-year main contract climbed by 0.04%.

– Foreign exchange

The US dollar fluctuated higher, with the ICE US Dollar Index rising by 0.40%.

The US dollar fluctuated higher. In late New York trading, the ICE US Dollar Index rose by 0.40% to 100.550 points, while the Bloomberg Dollar Index increased by 0.26% to 1,222.36 points.

[Non-US Currencies] The US dollar showed mixed performance against most major currencies

The US dollar showed mixed performance against major global currencies, with the Japanese yen rising strongly by 0.42%. In late New York trading, the US dollar fell 0.42% against the yen to 159.63 yen. The euro declined 0.44% against the dollar to $1.1457, and the British pound dropped 0.57% against the dollar to $1.3181.

The offshore Chinese yuan exchange rate stood at 6.9163 per US dollar.

In late New York trading, the offshore Chinese yuan exchange rate fell by 37 points from the previous trading day to 6.9163 per US dollar. The onshore yuan weakened by 10 points versus the previous closing price to 6.9106 per US dollar.

The cryptocurrency market experienced an initial rise followed by a decline throughout the day.

The cryptocurrency market initially rose but later declined during the day. In late New York trading, Bitcoin briefly rebounded above $68,000 before dropping below $66,500, ending nearly flat compared to the previous trading day. Ethereum gained approximately 1%.

– Product

US crude oil futures surged above $100.

Amid escalating tensions in the Middle East, oil prices continued to climb. In late New York trading, US crude oil futures surged by 3.25%, settling at $102.88 per barrel, marking the first time since July 2022 that prices breached the $100 mark.

Gold prices rallied then retreated, while aluminum prices hit a near four-year high.

Precious Metals:Gold prices surged then pulled back, with spot gold slightly up. In New York trading, spot gold rose about 0.2%, to $4,503.88 per ounce; U.S. gold futures increased by approximately 0.17%, to $4,531.90 per ounce.

Metals Futures Market:Spot silver prices remained largely unchanged from the previous trading day, fluctuating slightly around $70 per ounce. Aluminum prices surged due to attacks on producers amid Middle East tensions, with London aluminum futures climbing about 3.7% to $3,417 per ton, reaching a near four-year high.

[Disclaimer]

The content above is provided by Harbor Family Office (hereinafter referred to as "Harbor Family Office"), sourced from market information gathered from various channels. Neither Harbor Family Office nor its group members participated in preparing the content, nor did they explicitly or implicitly endorse or approve it. This article is for reference only and does not constitute any investment or trading advice. Investment involves risks. Readers should independently evaluate and judge this information and are advised to consult professionals before making any investment or trading decisions. Without authorization, no one may reproduce, copy, or publish the content in whole or in part to the public in any manner. Copyright belongs to Harbor Family Office and relevant providers.

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