U.S. stocks ended higher on Friday, marking the week with significant gains. April’s non-farm payroll data came in much weaker than expected, with rising unemployment rates and slowing wage growth, reigniting market expectations for potential Fed rate cuts this year.

Investors were particularly attentive to the lackluster non-farm payroll figures released on Friday. The data indicated a broad weakness, boosting expectations for the Fed to cut rates twice by 25 basis points in 2024.

Jamie Cox, Managing Partner at Harris Financial Group, commented, “The comprehensive weakness in the jobs data is overall positive for the market. The soft wage growth helps alleviate concerns about a significant resurgence in inflation.”

U.S. Stocks

Fundamental Analysis: 

Major tech stocks surged, with Apple’s shares increasing nearly 6% following stronger-than-expected Q2 revenues and net profits, prompting the company to announce an additional $110 billion stock buyback.

Netflix, Meta, and Microsoft each rose over 2%, while Amazon and Google saw modest increases. Tesla fell just over 1%, and both Netflix and Apple saw slight declines.

In the semiconductor sector, Advanced Micro Devices saw a significant jump of nearly 9%, Qualcomm rose over 2%, with Nvidia, Applied Materials, and Arm also recording gains; Intel dropped over 9%, and STMicroelectronics nearly 3%.

Chinese concept stocks largely advanced, with the Nasdaq Golden Dragon China Index up 1.73% for the week, accumulating a 5.53% rise.

New Oriental, Trip.com, and NetEase increased over 4%, while KE Holdings, Tencent Music, and TAL Education gained over 3%.

Baidu, Alibaba, and Pinduoduo advanced over 1%, with smaller gains for Bilibili, JD.com, and others. XPeng Motors and Li Auto saw declines over 3%, with NIO and iQiyi slightly down.

Technical Analysis: 

(S&P 500 Index, 1-day chart) 

Market Trends: 

• Nasdaq rose 315.37 points, a 1.99% increase, closing at 16,156.33.
• The Dow Jones gained 450.02 points, up by 1.18%, finishing at 38,675.68.
• The S&P 500 increased by 63.59 points, or 1.26%, ending at 5,127.79.

Hong Kong Stock Market

Fundamental Analysis: 

The three major indices in Hong Kong saw a high start but ended lower.

In the tech sector, performances varied; Baidu rose nearly 2% after announcing a partnership with Tesla, Alibaba and NetEase followed suit, while JD.com and Xiaomi dropped over 1%.

The appliance sector led gains with Haier Smart Home surging over 8%. Real estate stocks retreated, with China Vanke down over 7%.

The oil sector was notably active with CNOOC rising nearly 4%. The performance of Chinese brokerage stocks was subdued with CITIC Securities, China International Capital Corporation, and Huatai Securities all falling over 4%.

High-speed railway infrastructure stocks saw strong performance, with Guangshen Railway up over 8%. On the news front, on May 2, the 12306 website announced fare adjustments for four high-speed trains including Wuhan-Guangzhou and Shanghai-Hangzhou, highlighting a move towards market-priced fares, a positive for railway operators and asset owners.

Technical Analysis: 

(Hang Seng Index, 1-day chart) 

Market Trends: 

• Hang Seng Index rose 1.14%, closing at 18,413.79.
• The Hang Seng Tech Index increased by 2.07%, finishing at 3,945.56.
• The Hang Seng Enterprises Index was up 1.29%, closing at 6,520.05.

FTSE China A50 Index

Chinese stocks opened higher and continued to rise, with significant gains observed in the Shenzhen Composite and the ChiNext Index, both surging over 2% by midday. The biotechnology and chemical sectors led the rally.

The healthcare sector saw widespread gains, particularly in synthetic biology. Chuan Ning Biotech hit the 20% daily limit, and Shengda Bio also approached the limit. The graphite electrode sector also advanced, with Baichuan Shares reaching a trading halt mid-session. The high-speed rail transport sector strengthened significantly, with Kean Technology and Bid Technology hitting their upper trading limits.

Technical Analysis:  

(SSE Composite Index, 1-day chart) 

Market Trends: 

• The Shanghai Composite Index was up 1.05%, standing at 3,137.36 points.
• The Shenzhen Composite Index increased by 2.05%, reaching 9,783.47 points.
• The ChiNext Index rose 2.18%, to 1,898.94 points.
• The STAR 50 Index gained 1.63%, at 779.95 points.

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