Breakfast | S&P and Nasdaq fell for the fourth consecutive day, Microsoft plans to stockpile 1.8 million AI chips

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Overnight Morning Market

Nasdaq fell more than 1%, ASML plummeted 7% after earnings, Bitcoin briefly fell below $60,000

Tech stocks dragged down all three major indexes for the second day this week, with the S&P and Nasdaq falling for the fourth consecutive day. The Nasdaq fell by 1.15%, the S&P fell by 0.58%, the Dow fell by 0.12%, the Russell 2000 fell by 0.99%, marking a four-day decline.

Tesla fell by nearly 1.1%, also marking a four-day decline. Meta fell for the fourth day, Apple dropped by 0.8%, Microsoft by nearly 0.7%, Amazon fell for the fourth day, ASML's US stocks dropped by nearly 7.1%; Nvidia fell by nearly 3.9%, AMD by 5.8%, Intel by 1.6%.

Chinese concept stocks had mixed performances, with XPeng up by 3.8%, Nio up by over 2%, Li Auto up by over 1%, and Xiaomi slightly up by about 0.5%. Baidu fell by nearly 2%, Alibaba by over 1%, NetEase by 0.5%, Tencent slightly down by 0.4%, and Pinduoduo by less than 0.1%.

Trump Media (DJT) surged by over 15%. Astera Labs (ALAB) fell by over 1%.

Blue Chips and Hot Stocks

Tesla's Buffalo factory will lay off 285 employees, expected to take effect from July 15. Sources: Musk may announce an investment of $2-3 billion in India during his trip to New Delhi.

Tesla's 2024 annual shareholder meeting will be held on June 3. Tesla's Shanghai Megapack factory will start construction next month and achieve mass production in the first quarter of next year.

Apple CEO Cook: Apple will explore the possibility of establishing manufacturing facilities in Indonesia.

Apple's European testing launched the "Website Distribution" option: iPhone users can directly download apps from the website.

Software company Zuora is reportedly exploring various options including a sale. Zuora's stock price rose by nearly 12%.

Alphabet CEO Pichai sold $3.54 million in stocks.

Google is expanding layoffs and transferring some positions to other countries.

Some Google employees held a demonstration in front of the company's office building in Sunnyvale, California, protesting Google's AI projects serving the Israeli Ministry of Defense. Protesters called for an immediate ceasefire in the Gaza Strip. Nimbus is a collaborative project between Google and Amazon that provides cloud computing, machine learning, and AI capabilities to the Israeli Ministry of Defense.

US electric vehicle manufacturer Rivian, after layoffs in February, is cutting about 1% of its workforce.

UBS plans to lay off more than 100 people in its investment banking division.

Market news: Samsung must pay $142 million for infringing on smartphone patents.

Chips and Artificial Intelligence

Microsoft will avoid a formal investigation by the EU into its $13 billion investment in OpenAI.

Sources say Microsoft plans to accumulate 1.8 million AI chips by December 2024.

Micron Technology is building factories in New York and Idaho, and is expected to receive over $6 billion in chip action funding next week South Korea considers extending tax incentives for chip investments

ASML reported a net sales of 5.3 billion euros in the first quarter, a year-on-year decrease of 21%; net profit reached 1.2 billion euros, down 38%. The company's total gross margin for products and services was 51%, with new orders in the first quarter totaling 3.6 billion euros, including 656 million euros for EUV lithography machines. ASML expects net sales in the second quarter of 2024 to be between 5.7 billion and 6.2 billion euros, with a gross margin between 50% and 51%, and anticipates that net sales in 2024 will be roughly flat compared to 2023.

Toshiba has started adjustments by cutting 5,000 domestic employees in Japan, accounting for less than 10% of the total in Japan. Toshiba will review its cost structure and lay the foundation for further growth centered around infrastructure and digital technology.

Cryptocurrency

Some say that any escalation of the Middle East crisis will lead to a flow of safe-haven funds into the US dollar. Bitcoin accelerated its decline after the US stock market turned lower, breaking below the low set after the weekend's Iranian attack on Israel, falling below the $60,000 mark for the first time in over a month.

Macro: A Look at the World

Fed's Mester: Will cut interest rates at some point, but no need to rush.

Fed's Beige Book: Slight expansion in the US economy, significant increase in difficulty for businesses to pass on costs; wage pressures easing, people holding a cautiously optimistic view of the economy.

New York Fed: Fed's balance sheet reduction may end in 2025.

Citi: Fed doesn't seem so "hawkish," could still cut rates five times this year.

The US-China Financial Working Group held its fourth meeting; the US-China Economic Working Group held its fourth meeting.

China's Ministry of Commerce: USTR announced a Section 301 investigation into China's maritime, logistics, and shipbuilding industries. China strongly opposes this and is firmly against it.

US and Europe claim China has an "overcapacity" problem, China's Foreign Ministry responds: Taking trade protection measures under the pretext of "overcapacity" will not make oneself better.

14 Chinese departments have clarified the plan for the "scrappage for new" program, planning to scrap nearly 10 million vehicles by 2024, and the official "scrappage for new mini-program" may go online.

Goldman Sachs: Expects a significant supply shortage of refined copper in 2024, with copper prices rising to $12,000 in Q1 next year