Chip stocks drag down US stocks, with the Nasdaq falling more than 1%. After disappointing earnings, Asml plunges 7%, Bitcoin briefly falls below the $60,000 mark, and gold drops from record highs

Technology stocks became the culprit for the decline in US stocks on Wednesday. Europe's highest market value technology company ASML saw a sharp decline of 61% in new orders in the first quarter, far below expectations, dragging down chip stocks in Europe and the United States. Benchmark AI companies like NVIDIA were not spared. The three major US stock indexes opened higher in the morning but turned lower, with the S&P and Nasdaq once again failing to rebound during the day, further probing near the lowest point in nearly two months. There were reports during the day that the option of attacking Iran's nuclear facilities was being considered, with some commentators believing that this had previously triggered a decline in US stocks.

Corporate earnings reports continue to be closely watched. Insurance company Travelers plummeted due to high disaster losses and lackluster profits, leading the Dow lower. Healthcare giant UnitedHealth, which announced strong financial reports on Tuesday, failed to reverse the downward trend of the Dow. Despite positive second-quarter profit guidance, American Airlines, which saw its full-year narrow-body aircraft delivery expectations almost halved, surged, while another Dow component, Boeing, fell back. Two European consumer goods giants, LVMH and Adidas, reported strong growth in the Chinese market and strong demand for some footwear, helping to offset the impact of the leading technology stocks like ASML and supporting a rebound in the overall European stock market.

Wall Street News once mentioned that on Tuesday, the US stock market "didn't care much" about Federal Reserve Chairman Powell's dampening of rate cut expectations, partly because corporate earnings have replaced monetary policy as the main driver of current stock market volatility. Barclays strategists recently stated that due to investor concerns about high interest rates and geopolitical uncertainties, corporate earnings have taken on the responsibility of driving the stock market further upwards. Some commentators believe that the combination of geopolitical uncertainty, rising interest rates, a hawkish Fed stance, and frustration over inflation has temporarily put the bears in the lead. Investor sentiment and behavior have changed significantly since October last year, laying the foundation for long-term sideways volatility.

In the bond market, the US Treasury completed the sale of $13 billion worth of 20-year bonds, with indicators showing strong demand. After the results of the sale were announced, US bond prices accelerated their rebound, yield declines widened, and they quickly moved away from the highs of the past five months. The yield on the benchmark 10-year US Treasury bond returned to below 4.60%, falling more than 10 basis points from the high set on Tuesday, while the yield on the two-year US Treasury bond, which is sensitive to interest rates, did not continue to hover around the 5.0% level.

Although US bond yields fell on Wednesday, market expectations for a rate cut by the Federal Reserve this year have largely remained unchanged, still below 50 basis points.

In the foreign exchange market, the UK's CPI growth rate slowed to a two-and-a-half-year low in March, reinforcing expectations of a rate cut by the Bank of England. The British pound rebounded against the US dollar and rose to a one-month high against the euro, causing the US dollar to fall. The momentum of the US dollar index, which had been hitting five-month highs in recent days, paused, leading to its first weekly decline in a week, allowing the Japanese yen to temporarily move away from its lowest level since 1990 Some analysts are still bullish on the US dollar, with some saying that any escalation of the Middle East crisis will lead to a influx of safe-haven funds into the US dollar, benefiting from it. Bitcoin accelerated its decline after the US stock market turned lower, breaking below the low set after the weekend Iranian attack on Israel, falling below the $60,000 mark for the first time in over a month.

In the commodity market, gold, which hit historical highs for four consecutive days, retreated. International crude oil prices plummeted, with concerns about demand outweighing the impact of supply risks from the Middle East situation. The US Energy Information Administration (EIA) announced that US crude oil inventories increased for the fourth consecutive week, with an increase of over 2.7 million barrels, more than double analysts' expectations. After the data was released, crude oil fell by over 3%, erasing all gains for the month and marking the worst single-day performance since Saudi Arabia unexpectedly cut its official crude oil selling price three months ago. Some comments mentioned that EIA data showed disappointing gasoline demand once again, with the four-week average falling to a low not seen since 2022. Analysts pointed out that the attack by Iran on Israel is unlikely to quickly trigger US sanctions on Iranian oil exports, and the geopolitical conflict-induced crude oil premium is dissipating.

The chart above shows the reversal of the US oil price trend, indicating that while oil prices plummeted during US stock trading, the S&P 500's decline narrowed slightly.

S&P Nasdaq falls for the fourth consecutive day, with Google rising alone among the "Seven Sisters of Technology", Nvidia falling nearly 4% after earnings, Travelers plunging, and United Airlines soaring

The three major US stock indexes opened higher collectively, with the Nasdaq Composite Index, which rose nearly 0.6% in early trading, turning lower half an hour after the opening, and the decline expanding to over 1% at midday. The S&P 500 Index, which rose over 0.5% in early trading, and the Dow Jones Industrial Average, which rose nearly 240 points in early trading, both turned lower in the morning. At midday, the S&P fell nearly 0.7%, the Dow fell over 160 points, down more than 0.4%, before narrowing the decline, with the Dow briefly turning higher and the S&P briefly turning higher. In the end, the three major indexes collectively fell for the second day this week, with the S&P and Nasdaq falling for four consecutive days, marking the longest consecutive decline since January 5th.

The Nasdaq fell 1.15% to 15683.37 points, while the S&P fell 0.58% to 5022.21 points, both hitting their lowest closing levels since February 21st for the third consecutive day. The Dow, which ended a seven-day losing streak on Tuesday, fell 45.66 points, or 0.12%, to 37753.31 points, approaching the low closing level set on January 18th that was refreshed on Monday.

The small-cap Russell 2000 index, dominated by value stocks, fell 0.99%, marking a four-day decline to its lowest level since February 5th. The tech-heavy Nasdaq 100 index fell 1.24%, falling back to its lowest closing level since February 21st after rebounding on Tuesday. The Nasdaq Technology Market Cap Weighted Index (NDXTMC), which measures the performance of tech stocks in the Nasdaq 100 index, fell 1.75% to its lowest level since February 28th The major U.S. stock indexes turned lower in early trading on Wednesday and closed lower, with the Dow and S&P briefly turning higher.

Among the major sectors of the S&P 500, seven closed lower on Wednesday, with the IT sector, including chip stocks like Nvidia, leading the decline with a 1.7% drop. Other sectors fell by no more than 0.8%, with the communication services sector, including Google, falling by over 0.1%, the smallest decline. Among the four sectors that closed higher, utilities led with a gain of over 2%, followed by consumer staples with a nearly 0.5% increase, and financials and materials with a 0.2% rise.

In the Dow components, insurance company Travelers (TRV), which reported lower-than-expected earnings and revenue for the first quarter, led the decline with a 7.4% drop. Intel and Amazon fell by over 1%, Boeing (BA) briefly fell by over 1% in midday trading before closing down 0.2%. On the other hand, UnitedHealth (UNH), which surged over 5% after its earnings report on Tuesday, initially rose by over 4% and closed up 2.1%, leading the gains for two consecutive days.

Among the tech giants known as the "Seven Sisters" including Microsoft, Apple, Nvidia, Google's parent company Alphabet, Amazon, Meta (Facebook's parent company), and Tesla, only Alphabet did not fall during the trading session. Tesla, which had the largest decline in the past two days, initially fell in early trading, dropping by 2.1%, but the decline narrowed to nearly 1.1% by the close, marking a four-day decline and hitting a new low since April 26, 2023.

Among the FAANMG six major tech stocks, Meta and Netflix turned lower in early trading, closing down by 1.1% and 0.6% respectively. Meta has been on a four-day decline since April 1, while Netflix has failed to move away from the low set on March 15 that was refreshed on Monday. Apple rose by over 0.7% in early trading but closed down by 0.8%, approaching the low set on October 26, 2023. Microsoft rose by 1% initially but turned lower in early trading, closing down by nearly 0.7%, hitting a new low since March 11. Amazon, which rose by nearly 0.7% in early trading, turned lower and closed down by 1.1%, marking a four-day decline and refreshing the low since April 4. Alphabet, which had been on a three-day decline since April 5, initially rose by 1.7% and closed up by nearly 0.6%.

After a rebound on Tuesday, chip stocks fell back on Wednesday, with the Philadelphia Semiconductor Index and the Semiconductor Industry ETF SOXX turning lower in early trading, closing down by nearly 3.3% and about 3%, respectively, hitting the lowest closing level since February 21. Among chip stocks, ASML, listed on the Nasdaq, fell by over 8% at midday, dropping by nearly 7.1% after briefly falling by 8.3%. Nvidia, which rose by nearly 1.6% in early trading, turned lower less than half an hour after the market opened, closing down by nearly 3.9%, hitting a low since March 1. At the close, AMD, which turned lower in early trading, fell by 5.8%, while Intel dropped by 1.6%. Taiwan Semiconductor's U.S. stock, which rose by nearly 2% in early trading, fell by nearly 0.6% by the close Nvidia-led Tech Stocks Lead the Decline in US Stocks

Overall, AI concept stocks followed the market downturn. At the close, SoundHound.ai (SOUN), BigBear.ai (BBAI), Palantir (PLTR) all fell by over 2%, while Super Micro Computer (SMCI), Oracle (ORCL), Astera Labs (ALAB) known as "Little Nvidia" for selling data center interconnect chips, fell by over 1%. Adobe (ADBE) fell by about 0.4%, while C3.ai (AI) rose by 0.5%.

Bank stocks rebounded across the board. The overall banking industry index KBW Bank Index (BKX) rose by 0.7% from the low closing level since March 1st on Tuesday; the regional banking index KBW Nasdaq Regional Banking Index (KRX) rose by nearly 0.2%, and the regional bank stock ETF SPDR S&P Regional Banking ETF (KRE) also rose by nearly 0.2%, rebounding after three consecutive days of decline, reaching new closing lows since November 28 and November 30, 2023, respectively.

Among the major banks, Morgan Stanley, which will issue bonds after releasing its financial report following JPMorgan Chase and Wells Fargo, rose by nearly 1.1%. After releasing its financial report on Tuesday, Bank of America, which fell by 3.5%, rose by 1.6%. Citigroup rose by over 2% in early trading, marking its first rise since announcing its financial report last Friday. By the close, Goldman Sachs rose by nearly 1.8%, Wells Fargo rose by nearly 1.4%, while JPMorgan Chase, which turned lower in early trading, fell by 0.4%.

Among the stocks that released financial reports, United Airlines (UAL), which reported lower-than-expected first-quarter EPS losses, higher-than-expected revenue, and higher-than-expected second-quarter profit guidance, rose by nearly 17.5%; while transportation and logistics company J.B. Hunt Transport Services (JBHT), which reported lower-than-expected first-quarter earnings and revenue, mentioned that domestic demand did not see growth as expected, fell by 8.1%. Additionally, software company Autodesk (ADSK), which announced a further delay in releasing its financial report due to an internal investigation into its directors, fell by over 8% in early trading and closed down by 5.8%.

In terms of volatile stocks, after the Phase III trial showed that its popular weight loss drug Zepbound exceeded institutional expectations in improving symptoms of sleep apnea, one of the "weight loss drug giants" Eli Lilly (LLY) rose by over 3% in early trading and closed up by 0.5%, while Resmed (RMD), which produces devices to treat sleep-related breathing disorders, fell by nearly 6%; after Jefferies believed that the growth in foot traffic at its brand stores was slowing down and downgraded its rating from hold to underperform the industry, clothing retailer Urban Outfitters (URBN) fell by over 4% in early trading and closed down by 2.5% The performance of popular Chinese concept stocks varies, with some falling in the morning session while others see a narrowing decline. The Nasdaq Golden Dragon China Index (HXC) initially rose by over 0.7%, but turned downwards in the morning session to close with a 0.3% decline, marking a third consecutive drop and hitting a new low since February 13th. Among the new forces in the electric vehicle sector, XPeng Motors closed with a 3.8% increase, Nio rose by over 2%, Li Auto rose by over 1%, and Xiaomi fans' shares increased by approximately 0.5%. As for other individual stocks, Baidu fell by nearly 2%, Alibaba dropped by over 1%, NetEase fell by 0.5%, Tencent fans' shares dropped by 0.4%, Pinduoduo, which turned downwards in the morning, fell by less than 0.1%, while JD.com rose by nearly 0.4% in the morning and Bilibili rose by less than 1%.

In European stocks, the pan-European stock index, which experienced its largest decline in nine months on Tuesday, saw a slight rebound. The European Stoxx 600 index, which fell by over 1.5% on Tuesday, closed with an increase of less than 0.1%, moving away from the closing low since March 6th set on Tuesday. Major European country indices mostly closed higher, with the UK stock index, which had fallen for two consecutive days, and the German, French, Italian, and Spanish stock indices, which retreated on Tuesday, all rebounding. However, the Dutch domestic stock index where ASML is listed fell by nearly 1.1%.

In various sectors, the personal and household goods sector, where luxury goods giants are located, rose by approximately 1.8%. Following the announcement of first-quarter organic revenue growth meeting expectations and a 10% increase in demand for fashion and leather goods in the Chinese market, LVMH rose by 2.8%, leading to a 2.3% increase in Hermes and a nearly 3% rise in Richemont. On the other hand, the technology sector fell by 3.4%, with ASML, the highest market value technology stock listed in the Netherlands, falling by 6.7%. Among other stocks that reported earnings, Adidas rose by over 8.6% after reporting first-quarter revenue higher than expected and raising full-year guidance due to strong demand for sports shoes, supporting the rebound in German stocks. However, Continental, a supplier of tires and other transportation industry components, fell by 5.5% after reporting first-quarter revenue and profit margins below expectations, while online food delivery company Just Eat Takeaway fell by 4.5% after reporting first-quarter orders below expectations.

U.S. Treasury Prices Rebound, 10-Year Yield Retreats Over 10 Basis Points from Five-Month High

The U.S. 10-year benchmark Treasury yield rose above 4.68% in the early Asian session, hitting a daily high, but accelerated its decline from the pre-market of the U.S. stock market. By midday, the U.S. stock market fell below 4.60%, and after the completion of the 20-year U.S. bond auction, it briefly dropped below 4.58% to set a daily low. The yield dropped by over 9 basis points during the day, retreating approximately 12 basis points from the high since November 13, 2023, set over the past two days, and settled around 4.59% by the end of the bond market session, down nearly 8 basis points intraday, marking the second consecutive day of decline in the last six trading days After Wednesday's midday announcement of strong demand for the 20-year US Treasury bond auction, the overall decline in US Treasury yields expanded, hitting a new daily low.

The 2-year US Treasury yield, which is more sensitive to interest rate prospects, rose to nearly 5.0% in pre-European stock trading, hitting a daily high. During midday trading in the US stock market, it briefly fell below 4.92%, setting a new daily low. It dropped more than 7 basis points during the day, moving away from the high reached on November 14, 2023, when it rose above 5.0%. By the end of the bond market session, it was around 4.93%, dropping nearly 6 basis points during the day after rising for two consecutive days.

The 2-year US Treasury yield rose to around 5.0% in pre-European stock trading on Wednesday, but later fell by more than 7 basis points.

The US Dollar Index Retreats from Five-Month High, Yen Temporarily Moves Away from Lowest Level Since 1990, Bitcoin Drops Nearly $5000 During Trading

The ICE US Dollar Index (DXY), which tracks the exchange rate of the US dollar against a basket of six major currencies including the euro, rose above 106.40 in pre-European stock trading, approaching the level above 106.50 reached on Tuesday and setting a new high since November 1, 2023, for two consecutive days. It rose nearly 0.2% during the day, but turned lower after the release of UK CPI data. European stocks, US pre-market, and early trading briefly turned higher, but US stocks accelerated their decline during midday trading, falling below 105.90 at the daily low and dropping nearly 0.4% during the day.

By the end of Wednesday's US stock market session, the US Dollar Index was slightly below 106.00, down 0.3% during the day. The Bloomberg Dollar Spot Index, which tracks the US dollar against ten other major currencies, fell by over 0.3% during the day, moving away from the high reached in the same period since November 2023 after four consecutive days of increase, following the trend of the US Dollar Index which also retreated after five consecutive days of gains.

Among non-US currencies, the yen temporarily moved away from its lowest level since 1990, with the US dollar falling below 154.20 against the yen during midday trading in the US stock market, dropping nearly 0.4% during the day. This was a retreat from the high near 154.80 reached for four consecutive days since 1990. The British pound rose above 1.2480 against the US dollar in early European stock trading, setting a new daily high. It rose nearly 0.5% during the day, moving away from the low reached on November 17, 2023, after Powell's speech.

The offshore Chinese yuan (CNH) against the US dollar hit a daily low of 7.2685 in early Asian trading, then rebounded after shaking. After the US stock market closed, it rose to 7.2425, hitting a high since April 10, far from the low reached on November 13, 2023, when it fell below 7.28. At 4:59 AM Beijing time on April 18, the offshore Chinese yuan against the US dollar was reported at 7.2440 yuan, up 204 points from the New York closing on Tuesday, rebounding after Tuesday's decline Bitcoin (BTC) was above $64,000 in pre-market trading in Europe, refreshing the daily high, with some platforms trading above $64,500. However, it continued to decline after that, accelerating its drop after the US stock market opened. At one point during midday, it fell below $59,800, breaking below $60,000 for the first time since March 5th, dropping more than $4,700 from the daily high, a decrease of over 7%. It later rose back above $61,000, narrowing the decline, and even briefly exceeded $61,400. By the time the US stock market closed, it was above $61,000, with a drop of over 2% in the last 24 hours.

Crude Oil Falls Over 3%, Marking the Largest Decline in Three Months and Three Consecutive Drops to a Three-Week Low

International crude oil futures have been mostly on a downward trend, briefly turning higher during the early Asian session, but accelerating the decline after the US stock market opened. At one point during midday, US WTI crude oil fell below $82.60, dropping by 3.3% intraday, while Brent crude oil fell below $87.20, a decrease of 3.2%.

Ultimately, crude oil fell for three consecutive days, marking the largest daily decline since Saudi Arabia unexpectedly lowered its official crude oil selling prices to Asia on January 8th. WTI May crude oil futures closed down $2.67, a decrease of nearly 3.13%, at $82.69 per barrel, hitting the lowest closing price since March 27th. Brent June crude oil futures closed down $2.73, a decrease of about 3.03%, at $87.29 per barrel, also hitting a three-week low.

US WTI crude oil fell by over 3% during the US stock market session, dropping to the lowest level since the end of March.

London Tin Rebounds to Near Two-Year High, Gold Falls from Four Consecutive Days of Record High Closes

London base metal futures rose across the board on Wednesday. Tin led the gains with a 3% increase, erasing losses from the previous two days and hitting a new high since June 2022. Nickel, which had fallen for two consecutive days, rose by nearly 3% to a one-week high. Zinc, which had dropped for two days, rose by over 2%, surpassing the high set since April 2021. Copper, which had fallen for two days, rose by over 1%, surpassing the high set since June 2022. Aluminum rose by about 1%, marking a four-day increase and hitting new highs since February 2021 for three consecutive days. Lead rebounded slightly, not moving away from the high set since November 2021 on Monday.

New York gold futures were mostly on a downward trend on Wednesday, briefly turning higher during the pre-European and early trading sessions, as well as the early US stock market session. However, during the midday US stock market session, it hit a daily low of $2376.5, dropping by 1.3% intraday, failing to approach the intraday historical high near $2450 set last Friday.

Spot gold rose above $2395 during the early US stock market session to refresh the daily high, but then continued to decline, dropping below $2362 during the US stock market session, hitting the lowest level since Monday, April 15th. It fell by over 0.9% intraday, dropping over 1.4% from the daily high, moving away from the intraday historical high above $2430 set last Friday At the close, COMEX June gold futures, which had risen for four consecutive trading days, fell by 0.81% to $2388.4 per ounce, dropping from the record high of $2407.8 set on Tuesday for the fourth consecutive day. At the close of the U.S. stock market, spot gold was slightly higher than $2370, down about 0.4% intraday, marking the first time since last Thursday that it did not refresh the highest record during the same period.

Gold fell in sync with the sharp drop in U.S. oil