U.S. stocks closed with mixed results on Friday. The Dow Jones inched higher, setting new intraday and closing record highs. However, semiconductor manufacturer Intel saw a substantial drop in its stock price following the release of its financial report.  

The December core PCE inflation index in the U.S. came in below 3%, reinforcing the possibility of an economic soft landing and causing markets to scale back expectations of a rate cut by the Federal Reserve in March. 

Investor attention is now turning to the Federal Reserve’s monetary policy meeting in January. According to the CME FedWatch tool, the market widely expects the Fed to keep interest rates unchanged during this meeting, but traders have reduced their expectations for a rate cut in March. 

Robert Pavlik, Senior Portfolio Manager at Dakota Wealth, commented, “The PCE data is essentially in line with expectations, consistent with what we’ve been hearing about consumer spending contributing to economic growth. These two numbers have both risen compared to last month, but I don’t think it has a significant impact on the overall market.” 

U.S. Stock Market

Fundamental Analysis: 

In the realm of Chinese concept stocks, most experienced declines with the Nasdaq Golden Dragon China Index dropping by 0.45%.  

Weibo faced a drop of over 2%, while Pinduoduo, iQiyi, and NetEase fell by over 1%. Baidu, XPeng Motors, Li Auto, JD.com, and Bilibili experienced slight declines. Nio and Tencent Music saw increases of over 1%, while Ctrip and Alibaba had modest gains. 

Major technology stocks generally faced declines, with Intel plummeting by nearly 12%. The company reported a 2.6 percentage point decline in Q4 gross margin and provided Q1 performance guidance below expectations. 

United Microelectronics and GlobalFoundries dropped by over 5%, ARM and Applied Materials fell by over 3%, and Nvidia, AMD, Apple, and Microsoft saw slight decreases. Netflix increased by over 1%, while Meta and Amazon had modest gains. 

Technical Analysis:   

(S&P 500 Index, 1-day chart) 

Market Trends: 

• Dow Jones rose by 60.30 points, up 0.16%, closing at 38,109.43 points. 
• Nasdaq fell by 55.13 points, down 0.36%, closing at 15,455.36 points. 
• S&P 500 Index decreased by 3.19 points, down 0.07%, closing at 4,890.97 points. 

Hong Kong Stock Market

Fundamental Analysis: 

All three major Hong Kong indices recorded gains. Among notable movements, Baidu rose by over 3%, Alibaba by nearly 3%, JD.com by over 2%, and Meituan dropped by about 0.5%.  

In the category of mid-sized stocks, China Communications Construction surged by over 7%, Sinopec rose by nearly 4%, and most real estate stocks increased, with Longfor Group and Yuexiu Property up by over 3%.  

Pharmaceutical companies, including WuXi AppTec and WuXi Biologics, experienced declines of over 5%. Semiconductor concept stocks, led by SMIC, fell by over 2%.  

The entire Evergrande Group suspended trading, with China Evergrande falling by 20.87%, reaching a new low.  

In the morning, the Hong Kong High Court held a hearing on the liquidation of China Evergrande, ultimately ruling for its liquidation.  

On June 24, 2022, Jia Sheng Global filed a winding-up petition against China Evergrande with the Hong Kong High Court, involving a debt amount of HKD 862.5 million. 

Technical Analysis:  

(Hang Seng Index, 1-day chart) 

Market Trends: 

• Hang Seng Index (HSI) rose by 0.94%, closing at 16,102.02 points. 
• Hang Seng Tech Index (HSTECH) increased by 0.61%, closing at 3,206.02 points. 
• Hang Seng China Enterprises Index (HSCEI.) surged by 1.05%, closing at 5,416.30 points. 

FTSE China A50 Index

Fundamental Analysis: 

The three major A-share indices opened with mixed results, with the Shanghai Composite oscillating horizontally after opening.  

The Shenzhen Component and the ChiNext Index both weakened, with the ChiNext Index falling by over 2%.  

Among industry sectors, insurance, banking, engineering consulting services, shipbuilding, power, and liquor industries recorded the highest gains. 

Meanwhile, photovoltaic equipment, gaming, household light industry, communication equipment, plastic products, and motors faced the most significant declines.  

Themes such as central enterprise reform, liquor, super brands, weight loss drugs, and new stocks were active. 

Technical Analysis: 

(SSE Composite Index, 1-day chart) 

Market Trends: 

• Shanghai Composite Index (SHCOMP) rose by 0.3%, closing at 2,918.81 points. 
• Shenzhen Component Index (SZCOMP) dropped by 1.08%, closing at 8,667.73 points. 
• ChiNext Index (CHINEXT) declined by 2.31%, closing at 1,643.67 points. 
• SSE STAR Market 50 Index (SSE50) dropped by 1.5%, closing at 734.89 points. 

Forward-looking Statements    
This article contains “forward-looking statements” and may be identified by the use of forward-looking terminology such as “anticipate”, “believe”, “continue”, “could”, “estimate”, “expect”, “hope”, “intend”, “may”, “might”, “plan”, “potential”, “predict”, “should”, or “will”, or other variations thereon or comparable terminology. However, the absence of such terminology does not mean that a statement is not forward-looking. In particular, statements about the expectations, beliefs, plans, objectives, assumptions, future events, or future performance of Doo Prime will be generally assumed as forward-looking statements.     

Doo Prime has provided these forward-looking statements based on all current information available to Doo Prime and Doo Prime’s current expectations, assumptions, estimates, and projections. While Doo Prime believes these expectations, assumptions, estimations, and projections are reasonable, these forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond Doo Prime’s control. Such risks and uncertainties may cause results, performance, or achievements materially different from those expressed or implied by the forward-looking statements.     

Doo Prime does not provide any representation or warranty on the reliability, accuracy, or completeness of such statements. Doo Prime is not obliged to provide or release any updates or revisions to any forward-looking statements.    

Risk Disclosure
Trading in financial instruments involves high risks due to the fluctuation in the value and prices of the underlying financial instruments. Due to the adverse and unpredictable market movements, large losses exceeding the investor’s initial investment could incur within a short period of time. The past performance of a financial instrument is not an indication of its future performance. Investments in certain services should be made on margin or leverage, where relatively small movements in trading prices may have a disproportionately large impact on the client’s investment and the client should therefore be prepared to suffer significant losses when using such trading facilities.

Please ensure you read and fully understand the trading risks of the respective financial instrument before engaging in any transaction with Doo Prime’s trading platforms. You should seek independent professional advice if you do not understand any of the risks disclosed by us herein or any risk associated with the trade and investment of financial instruments. Please refer to Doo Prime’s Client Agreement and Risk Disclosure Statement to learn more.

Disclaimer    
While every effort has been made to ensure the accuracy of the information in this document, DOO Prime does not warrant or guarantee the accuracy, completeness or reliability of this information. DOO Prime does not accept responsibility for any losses or damages arising directly or indirectly, from the use of this document. The material contained in this document is provided solely for general information and educational purposes and is not and should not be construed as, an offer to buy or sell, or as a solicitation of an offer to buy or sell, securities, futures, options, bonds or any other relevant financial instruments or investments. Nothing in this document should be taken as making any recommendations or providing any investment or other advice with respect to the purchase, sale or other disposition of financial instruments, any related products or any other products, securities or investments. Trading involves risk and you are advised to exercise caution in relation to the report. Before making any investment decision, prospective investors should seek advice from their own financial advisers, take into account their individual financial needs and circumstances and carefully consider the risks associated with such investment decision.