Shenzhen Business Daily Reading Client Reporter Chen Yanqing
Eastern time on Wednesday, stimulated by the Federal Reserve's interest rate cut signal, the Dow Jones index hit a record high. As of **, the Dow Jones Index **140% at 3709024 o'clock;NASDAQ**138% at 1473396 points;S&P 500**137% at 470709 o'clock. The industry believes that the Federal Reserve will cut interest rates in the middle of next year, which is good for global risk assets such as ** and commodities.
Most of the popular technology stocks **, Apple rose 167% is an all-time high, with a market capitalization of 308 trillion dollars. Netflix rose 367%, Tesla rose 096%, Nvidia rose 09%, Amazon rose 092%。Popular Chinese concept stocks were mixed, with the Nasdaq China Golden Dragon Index rising 042%。
Spurred by the Federal Reserve's interest rate cut next year, the dollar index weakened, and U.S. Treasury yields slid higher. Among them, the U.S. dollar index **096%, falling below the 103 mark, offshore RMB** exceeded 600 points. U.S. 10-year Treasury yield**1729 basis points at 40296%。New York Futures** over 2%, New York*** over 3%.
The Federal Reserve interest rate meeting was held and maintained the federal interest rate range at 525%-5.50%, interest rates have remained unchanged since the end of July this year, and the published dot plot shows that the current rate hike cycle has been completed, and we expect to cut interest rates by 75 basis points next year, that is, three rate cuts, which is higher than expected in September.
Subsequently, Fed Chair Jerome Powell said at a press conference that it was good news that inflation was slowing without a surge in the unemployment rate, while reiterating that policy had entered restrictive territory. Powell pointed out that the supply side has basically returned to the pre-epidemic level, a soft landing of the U.S. economy is possible, interest rate cuts have begun to come into view, and policymakers are thinking and discussing when it is appropriate to cut interest rates.
However, there are also people who are cautious about the Fed's "dovish" release. Financial blog Zerohedge commented that even if the average benchmark interest rate falls to 4 by the end of next yearAround 6%, it is only back to the level of June this year, which is still higher than the level of March this year.
What do you think of the Fed's statement and the impact of the bond market?
In this regard, a public offering person in the east told reporters that the Federal Reserve has simultaneously lowered interest rate expectations and released more policy expectations in the case of reducing the growth rate of the economy and inflation, which is good for global risk assets. This also means that the exchange rate of emerging market currencies, including China, will usher in **. The People's Bank of China is also expected to continue to maintain monetary easing, and future RRR and interest rate cuts are expected, which is good for A-shares and China's bond market.
Zhong Zhengsheng, chief economist of Ping An**, expects that the Fed may discuss or even implement interest rate cuts in the second quarter of 2024. If an early rate cut can avoid a larger-than-expected economic downturn, then the current cycle of interest rate cuts can be slower and smoother, keeping interest rates high for a longer period of time, which is beneficial to curb inflationTry to avoid cutting interest rates at key times, which is conducive to maintaining the independence of monetary policy.
CITIC** expects that the current round of Fed interest rate hikes has ended, and the first rate cut may be carried out around the middle of next year. In the short term, it is expected that the U.S. dollar index and U.S. Treasury interest rates will show a weak** trend, and U.S. stocks may continue**, but it is necessary to pay attention to the adjustment risks brought by the economic slowdown and downward revision of performance.
CICC noted that the Fed is beginning to change its policy direction. Powell said this time that the interest rate cut discussion has "gradually come into view" and has clearly changed. The market was once worried that it would be "beaten" by the Fed if it was too eager to act in the past, but the result was that the Fed and the market converged.