The U.S. stock market saw declines on Wednesday, with the S&P 500 index breaking below the 4200-point threshold for the first time since May and the Nasdaq experiencing its largest single-day decline since February.  

The 10-year U.S. Treasury yield’s uptick exerted pressure on the stock market. Google’s stock price, falling over 9%, dragged the Nasdaq down. The market remains focused on U.S. corporate earnings and economic data. 

The rising U.S. government bond yields added pressure to the stock market. On Wednesday, the 10-year U.S. Treasury yield increased by 11.5 basis points, reaching 4.955%, peaking at 4.959% during the session. The 30-year Treasury yield rose by 15 basis points to 5.09%. 

Evelyne Gomez-Liechti, a strategist at HSBC, stated, “The bond yields may fluctuate within a certain range in the short term, but we do believe that the latest U.S. data supports a long-term increase in bond yields. If the 10-year Treasury yield tests the 5% level again, we would not be surprised.” 

U.S. Stocks 

Fundamental Analysis: 

Popular tech stocks saw a general decline. Google fell by more than 9%, marking its largest single-day decline since March 2020. While Alphabet’s second-quarter revenue and earnings per share exceeded analyst expectations, its cloud business revenue fell short of predictions, raising concerns among investors due to the importance of the cloud business for Alphabet’s future growth.  

Amazon fell by over 5%, Meta and NVIDIA by over 4%, Tesla and Apple by over 1%, while Microsoft rose by more than 3%.  

Robot, semiconductor, and software application sectors all experienced declines, with companies like Micron Technology, Snap, Intel, AMD falling by over 5%, while NXP Semiconductors, Qualcomm fell by over 4%, and ASML dropped nearly 3%. 

Popular Chinese concept stocks also faced declines, with the Nasdaq Golden Dragon China Index falling by 2.16%.  

XPeng Motors dropped by over 8%, while NIO and Futu Holdings fell by over 6%.  

Bilibili, iQiyi, Tencent Music, Vipshop, Baidu fell by over 3%, and companies like NIO and Alibaba dropped by over 2%, with Weibo, Manbang, and NetEase experiencing declines of over 1%. Pinduoduo and JD.com saw slight decreases. 

Technical Analysis:   

(S&P 500 Index, 1-day chart) 

Market Trends: 

• Dow Jones Industrial Average dropped by 105.38 points, a decline of 0.32%, closing at 33,036.00 points.  
• Nasdaq Composite Index (Nasdaq) fell by 318.65 points, a decline of 2.43%, closing at 12,821.22 points. 
• S&P 500 Index declined by 60.91 points, a decline of 1.43%, closing at 4,186.77 points. 

Hong Kong Stocks 

Turning to the Hong Kong stock market, the three main indices opened relatively flat. In terms of sector performance, tech stocks faced declines, with Bilibili falling by nearly 2%.  

Tencent, Alibaba, and NetEase experienced slight decreases.  

Automotive stocks declined broadly, with XPeng Motors falling by over 3%. ZeroRun, a carmaker, surged by 11% despite the overall downward trend.  

Sports equipment stocks took a significant hit, with Li-Ning falling by almost 14%. Education stocks, on the other hand, saw gains, with New Oriental rising by nearly 5%. 

Technical Analysis:  

(Hang Seng Index, 1-day chart) 

Market Trends: 

• Hang Seng Index (HSI) dropped by 0.55%, closing at 16,990.86 points. 
• Hang Seng Tech Index (HSTECH) fell by 0.34%, closing at 3,688.47 points. 
• Hang Seng China Enterprises Index (HSCEI) fell by 0.46%, closing at 5,826.96 points. 

FTSE China A50 Index 

Fundamental Analysis: 

In the A-share market (Shanghai and Shenzhen), the three major indices opened lower.  

After the opening, the Shanghai Composite Index traded flat and the Shenzhen Component Index and ChiNext Index gradually weakened, both experiencing declines of over 1%, with the ChiNext Index reaching a new low for the year.  

In terms of sector performance, sectors like shipbuilding, complete vehicle manufacturing, banking, auto parts, and utilities registered gains, while photovoltaic equipment, real estate services, coal, engineering consulting services, cement building materials, and battery sectors experienced declines.  

Stocks related to Huawei’s auto business and the 6G concept remained relatively active. 

Technical Analysis: 

(SSE Composite Index, 1-day chart) 

Market Trends: 

• Shanghai Composite Index (SHCOMP) fell by 0.29%, closing at 2,965.35 points. 
• Shenzhen Component Index (SZCOMP) fell by 0.8%, closing at 9,452.4 points. 
• ChiNext Index (CHINEXT) fell by 0.93%, closing at 1,846.54 points. 
• SSE STAR Market 50 Index (SSE50) fell by 1.08%, closing at 839.5 points. 

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