Uncertainty repeats! U.S. stocks have not shaken off the weak market outlook divergence

category:Finance
 Uncertainty repeats! U.S. stocks have not shaken off the weak market outlook divergence


The defensive plate performs better

Last week in the US stock market, defensive sectors such as consumer and utilities performed better, while offensive sectors such as chip stocks continued to bear pressure.

Last week, McDonalds gained the strongest among the Dow Components, rising 3.11% weekly, ranking first. DOW, Coca-Cola, American Express and travelers rose 2.28%, 2.08%, 1.5% and 1.46% respectively, ranking second to fifth. IBM fell 7.55%, ranking first among the declining constituent stocks. Intel, Pfizer Pharmaceutical, 3M and Caterpillar fell 5.55%, 4.34%, 4.15% and 4.14% respectively, ranking second to fifth.

AMD was the best performer in the S&P 500 index last week, up 16.13%. TransDigm Group and Tyson Food, which produce aircraft parts, are the other two companies that rose by more than 10%, up 15.67% and 10.79% respectively. On the decline list, six stocks fell by more than 10%. Previous medical and health care Bull Stock Nekta treatment fell 32.71%, ranking first; information technology companies DXC, Kafhens, international spices, medical companies Perrigo, Century Telecom fell 32.61%, 17.73%, 14.8%, 10.51%, 10.32%, respectively.

Since the Nasdaq Composite Index has more than 2600 constituent stocks, this paper uses the main index of Nasdaq - the Nasdaq 100 Index constituent stocks for statistics. The index fell 0.6% last week. Online trading companies Mercadolibre, Netease and Symantec led the gains, while chip companies such as Baidu, Meiguang Technologies and Sales led the decline.

It is worth noting that the Philadelphia Semiconductor Index, the offensive sentiment index of the US stock market, fell 6.61% in the previous week, the biggest one-week decline since December 2018, and fell 1.62% again last week. Only five of the 30 constituent stocks rose, while all the others fell.

Future outlook is divided

At present, there are divergent views on the future market of U.S. stocks. Optimists argue that American companies have invested a lot of cash in stock repurchases over the past year due to the continued expansion of the U.S. economy and the impact of Trumps tax reform. Repurchase of shares by listed companies can improve stock prices and enhance investor confidence, and this trend is expected to continue. Goldman Sachs expects the share repurchase of S&P 500 companies to reach a new high of $940 billion this year. Wells Fargo Securities analysts further said that the current price of U.S. banking stocks is the only price in recession, but there is no recession, the current valuation of banking stocks is very attractive. Financial companies represented by Citigroup are buying back stocks crazily, and the scale of repurchase is larger than that of the other companies. At any time, it is necessary to buy back more stocks by smashing pots and selling iron. Because valuation of stocks is very attractive now.

On the pessimistic side, however, investorsrisk aversion has risen sharply as uncertainties increase. If external factors continue to ferment, it will have a negative impact on the employment of American retail, manufacturing and extractive industries. Against the backdrop of unoptimistic economic fundamentals in the United States, the stock market in the United States may be in a downward trend. Raoul Parr, a former co-manager of GLGs global macro hedge fund, said the current situation had allowed him to make pessimistic forecasts about the economy and the market. He said that the financial market was at a critical turning point, and Wall Street investors should pay attention to dollar assets and carefully look for signs of increasing financial system pressure, which could trigger a financial crisis like 2008. Nomura analysts warned that there was not much time left for the market to rebound and that a Lehman-style sell-off might soon occur in the future. At present, the uncertainty of the Federal Reserves monetary policy position has also become an important factor for investors to worry about the stock market. US President Trump has again criticized the Federal Reserves monetary policy, saying that the US dollar is too strong to hurt the interests of the US manufacturing industry. The Federal Reserve needs to lower interest rates by another 100 basis points. The Federal Reserves new interest rate meeting will be held on September 18. Source: Liable Editor of China Securities News: Yang Bin_NF4368

On the pessimistic side, however, investorsrisk aversion has risen sharply as uncertainties increase. If external factors continue to ferment, it will have a negative impact on the employment of American retail, manufacturing and extractive industries. Against the backdrop of unoptimistic economic fundamentals in the United States, the stock market in the United States may be in a downward trend. Raoul Parr, a former co-manager of GLGs global macro hedge fund, said the current situation had allowed him to make pessimistic forecasts about the economy and the market. He said that the financial market was at a critical turning point, and Wall Street investors should pay attention to dollar assets and carefully look for signs of increasing financial system pressure, which could trigger a financial crisis like 2008. Nomura analysts warned that there was not much time left for the market to rebound and that a Lehman-style sell-off might soon occur in the future.