-- China** fell deeply, Asia*** while the United States and Europe** edged lower.
Global markets continue to show a pattern of falling in the Asian trading session today, but unlike Monday, there is a tendency for further fermentation this time:
Shanghai Composite Index**19%, erasing all gains from the previous session. The market is showing signs of overheating, so it's understandable that there are some ** out. - Hong Kong stocks also showed a sluggish trend, with the Hang Seng China Enterprises Index and the Hang Seng Technology Index both falling by more than 2% intraday. - Gold prices fell slightly, but the decline seemed to be intended. - The offshore renminbi has been trading for five consecutive trading days**, and the onshore and offshore price difference once reached 150 points, indicating that depreciation sentiment has risen. - The yield on the 10-year Treasury note edged slightly at 4The 30 integer mark goes up and down. - The sharp** oil price rally came to a halt for two consecutive trading days. - The U.S. dollar index has seen a significant move today after testing the 200-day move yesterday, which is a recent watershed for the U.S. dollar.
Today's ** is not driven by particularly negative news, and the next move is unpredictable:
1. The global market is roughly showing a pattern of "dollar **, everything falls", because the market has begun to price in "declining interest rate cut expectations", and the market has been selectively ignoring this problem until then. Market expectations for a full-year Fed rate cut fell to less than 75 basis points last night (in line with what the Fed's dot plot implied in December), and the probability of a rate cut in June was estimated to be around 51%.
2. In addition, there is no fundamental support for China and the United States this week, so as soon as there is a negative news fund, it will be respected. According to our calculations, the downside risk for U.S. equities has not been completely eliminated. Today's focus is on the release of the revised Q4 GDP in the evening, which we expect to be revised downward, which could slightly raise the market's expectations for a rate cut, but the impact on the market may be limited. Next week's February jobs report is another important data point following this week's PCE data, which has the potential to influence expectations for the Fed to cut interest rates this year.
3. For the Chinese market, the decline of the renminbi and the yuan may be limited before the important meeting next week. However, it should also be noted that the market has raised expectations for the meeting, and if the expectations are pulled higher and the market expectations are not met, then there will be downside risks to the market.
While major markets fell modestly, there was an eerie calm in global markets as traders awaited a test of new inflation data later in the week.