Market Overview

U.S. stocks rose, with the Dow Jones Industrial Average reaching a new high and the S&P 500 approaching a new peak, as investors withdrew from mega-cap stocks, and rotation helped small-cap stocks reach a near three-year high. Nvidia gained over 3%, nearing a new high. ASML, which reported disappointing earnings yesterday, fell further, with its U.S. shares dropping over 6%, hitting a low not seen in nearly a year. The bank stock index once surged over 2%, with Morgan Stanley's shares soaring 6.5% after its earnings report, reaching a new high. LVMH's European shares once fell 7.5%. Nuclear power stocks soared, with Oklo, a company invested in by OpenAI CEO Altman, rising nearly 42%.

The 10-year U.S. Treasury yield once fell below 4%, reaching a one-and-a-half-week low. The U.S. dollar hit its highest level in nearly 11 weeks.

The China concept index once rose over 2%, with JD.com once gaining 3.9%, and NIO falling nearly 2%. The offshore yuan rose to nearly 7.12 before erasing its gains.

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In the UK, the September CPI fell below the central bank's target for the first time in three and a half years. Expectations of a rate cut led the pound to its lowest level in two months, while UK stocks rose nearly 1% and UK bond yields plummeted by double digits.

U.S. oil once fell over 1%, breaking $70 again, but the closing loss was significantly reduced. Gold approached its historical high. Bitcoin rose above $68,000 for the first time since July during trading.

In the Asian session, the ChiNext index closed down over 2%, with the Chengdu-Chongqing板块掀起涨停潮, real estate leading the gains, chips correcting, and Treasury futures closing down collectively.

News Highlights

At 10 a.m. on Thursday, the Ministry of Housing and Urban-Rural Development, the Ministry of Finance, the Ministry of Natural Resources, the Central Bank, and the China Banking and Insurance Regulatory Commission will jointly hold a press conference to introduce the situation of promoting the stable and healthy development of the real estate market and answer questions from reporters.ASML's Heavyweight Earnings Call: The chip industry's demand recovery is slow, and customers are more cautious; AI continues to be seen as a key driver for industry recovery, with potential for upward movement. Wall Street attributes ASML's earnings bomb to Intel.

Behind Blackwell's Shipment Delay: Nvidia and TSMC are rumored to have "internal strife", with one party blaming packaging technology and the other accusing of being forced to rush work.

Morgan Stanley's Q3 net revenue exceeds expectations, with strong wealth management, trading, and banking business, and stock price reaches a new high.

Lee Ka Chiu: Hong Kong will build an international gold trading market, relax the upper limit of property mortgage loans, and significantly reduce the liquor tax starting today.

Media reports that Israel's plan to retaliate against Iran is "ready", and crude oil still falls for four consecutive days.

Market Closing Report

U.S. stocks: The Dow Jones Industrial Average rose by 0.79%, the S&P 500 Index rose by 0.47%, and the Nasdaq rose by 0.28%.

European stocks: The Euro STOXX 600 Index closed down by 0.19%. The German DAX 30 Index closed down by 0.27%. The French CAC 40 Index closed down by 0.40%. The UK FTSE 100 Index closed up by 0.97%.A-shares: The Shanghai Composite Index rose by 0.05%, the Shenzhen Component Index fell by 1.01%, and the ChiNext Index fell by 2.21%.

Bond market: The yield on the 10-year U.S. benchmark Treasury note fell by 1.36 basis points, reporting at 4.0180%. The yield on the two-year U.S. Treasury note fell by 0.79 basis points, reporting at 3.9376%.

Commodities: WTI November crude oil futures closed down by $0.19, a decrease of 0.27%, at $70.39 per barrel. Brent December crude oil futures closed down by $0.03, a decrease of 0.04%, at $74.22 per barrel. COMEX gold futures rose by 0.41%, reporting at $2689.90 per ounce. LME copper futures closed up by $28, reporting at $9558 per ton.

News in detail

Global highlights

The "third major" meeting is coming on Thursday, what signals will it release?

At 10 a.m. on Thursday, the Ministry of Housing and Urban-Rural Development, the Ministry of Finance, the Ministry of Natural Resources, the People's Bank of China, and the Banking and Insurance Regulatory Commission will jointly hold a press conference to introduce the situation of promoting the stable and healthy development of the real estate market and answer questions from journalists. Attention will be paid to whether there are new expressions between adhering to "housing for living, not for speculation" and "stopping the decline and stabilizing," as well as how to find a new balance between the arduous task of real estate inventory reduction and the construction of increased affordable housing. In addition, the market may ask how and when the real estate value-added tax exemption mentioned at the Ministry of Finance meeting will be implemented.

ASML's major earnings call: The demand recovery in the chip industry is slow, and customers are more cautious.

ASML CEO Christophe Fouquet said that although AI continues to be seen as a key driver of industry recovery and has potential upside, the recovery in other areas is slower than expected, leading to "customers being more cautious and some investment plans being postponed." Among them, the demand recovery in the automotive, mobile device, and personal computer markets is particularly slow. He also said that ASML will slow down short-term investment plans to adapt to market demand.Why did ASML "blow up"? Wall Street: It's all Intel's fault! Morgan Stanley's analysis suggests that ASML's key customer, Intel, may be the key to the slowdown in demand, and the delay in new nodes has also affected capacity expansion. Although spending on HBM and DDR5 continues, these are not as dependent on EUV as the demand for logic chips, so they cannot offset the weakness in the logic chip sector.

The analysis states that the most disappointing aspect of ASML's financial report this time is the company's order backlog, which has plummeted to €2.63 billion, returning to a three-year low. Against the backdrop of AI and memory upgrades, the company's order backlog not only fails to increase but is halved, undoubtedly pouring a bucket of cold water on the market. Such a "flash crash" in order data is mainly due to increased regulatory restrictions and some customers suddenly "cutting orders."

Behind the delayed shipment of Blackwell: NVIDIA and TSMC are exposed to "infighting," with one party blaming packaging technology and the other pointing to being forced to rush the work. The media reported that some NVIDIA engineers believe that part of the problem with the Blackwell chip stems from design flaws, while others believe it stems from TSMC's use of new technology to package different chips; TSMC employees believe that NVIDIA demanded a rush to complete the production process, leaving insufficient time to solve problems; when shareholders came knocking due to the delayed shipment of Blackwell, TSMC's investor relations department shifted the blame to NVIDIA. Although these are not enough to affect the nearly thirty-year cooperation between the two companies, they highlight the increasing pressure NVIDIA is putting on TSMC as the AI business becomes more lucrative.

Morgan Stanley's Q3 net revenue exceeded expectations, with strong wealth management, trading, and banking business, and the stock price hit a new high. The company's net revenue for the third quarter was $15.38 billion, higher than the expected $14.35 billion, with revenue from wealth management, trading, and investment banking all higher than expected. The Federal Reserve may start to lower interest rates this quarter, which could encourage Wall Street companies to engage in more financing and merger and acquisition activities.

Macro Overseas

Soros's comrade-in-arms: Clearing NVIDIA is a major mistake, and the Fed's large-scale rate cut in September was a misstep. Druckenmiller said that clearing NVIDIA was his "a major mistake." If NVIDIA's stock price falls, he will buy the stock again. The Fed's 50 basis point rate cut in September was a mistake, and he chose to short the bond market on the day of the rate cut. If inflation rises again, it could have a serious impact on market stability. Therefore, he hedges his positions through the bond market rather than the stock market.

Bank of America: Fund managers are fully "bullish" on China's economy and stocks, while the global stock market shows a sell signal. Bank of America's global survey in October showed that after the introduction of a package of stimulus measures in China, the net proportion of global fund managers who expect China's economy to strengthen in the next 12 months reached 48%, the highest since April 2023. However, it is necessary to be vigilant, as the global stock market has just triggered Bank of America's sell signal for the first time since February 2021. Investors show optimism, expecting a solid foundation for the global economy.

The UK's September CPI rose 1.7% year-on-year, falling below the central bank's target for the first time in three and a half years, and expectations for a rate cut in November have soared. Traders increased their bets on a rate cut by the Bank of England, expecting a 24 basis point rate cut in November and a cumulative rate cut of 42 basis points by the end of the year. The Bank of England's governor recently said that if inflation continues to improve, the pace of rate cuts may be "more aggressive." After the data was announced, the pound plummeted in the short term, breaking below 1.3 for the first time since August.

Overseas Companies

Tech giants are competing to invest in nuclear-powered data centers, nuclear power stocks soar, and Altman-backed company Oklo soars 40%. Amazon has become the latest tech giant to bet on nuclear power, including investing more than $500 million to develop small modular nuclear reactors (SMRs), and Google also signed a power purchase agreement with a US nuclear power company on Monday, optimistic about SMRs "quick and safe" power supply. Oklo, invested in by OpenAI CEO Altman, and NuScale Power, among other companies developing new nuclear power technologies, jumped about 40% on Wednesday.AI Godfather Yann LeCun Criticizes: Today's Large Models Are Dumber Than Cats, Merely Predicting Text Without Reasoning! LeCun believes that artificial intelligence has not actually reached the brink of intelligence. Large language models merely prove that "one can manipulate language without being smart," and they will never bring about true artificial general intelligence (AGI). The problem with today's AI systems lies in their design, not their scale.

OpenAI's Latest 53-Page Paper: ChatGPT Treats People Differently Based on Their Names, Being Friendlier to "Xiao Mei" Than "Xiao Shuai". The latest paper reveals that ChatGPT indeed treats people differently based on their names, automatically inferring gender, race, and other identity characteristics from the user's name, and repeating social biases from the training data. According to the research, in the "story writing" task, when the username implies gender, the AI tends to create protagonists that match the implied gender; responses to female names are, on average, more friendly and simple in language.

Cryptocurrencies Fluctuate Wildly, Over 93,000 People Face Liquidation! Is Musk Going to Sell Too? In the past 24 hours, the amount of liquidated cryptocurrency in the market has exceeded $300 million. Elon Musk, the world's richest man, has transferred Bitcoin worth about $765 million from Tesla to an unknown wallet, increasing the possibility of the automaker selling its Bitcoin.