After U.S. Treasury Secretary Yellen called the slightly higher interest rate environment a “plus” over the weekend, investors continued to focus on how close the Fed might be to starting QE withdrawal with a rapid pickup in inflation, turning their attention to the CPI due out this Thursday. U.S. stocks were slightly volatile, with the energy sector becoming a major upside driver for the broader market thanks to a two-year high in crude oil. Small-cap stocks continue to outperform the broader market, with health insurance startup Clover Health becoming a new favorite among retail investors, rising more than 100% at one point during the session. U.S. bond prices rebounded and yields fell, with the 10-year bond yield falling to a one-month low during the session.
Biotech stocks, which were soaring on Monday, retreated, but the two leading tech stocks, Apple and Amazon, rose, helping to offset the drag on the broader market from biotech stocks as the Nasdaq hit again. Biogen (BIIB), which rose more than 60% in Monday’s session because its Alzheimer’s drug was approved by U.S. regulators, fell nearly 6% at one point on Tuesday. The Nasdaq Biotechnology Index (NBI), which rose more than 4% in Monday’s session, had fallen nearly 1.7% in Tuesday’s session. New energy vehicle concept stocks, in addition to the intraday turn down Tesla, all other continued to rise. The U.S. Department of Energy launched the Energy Earthshots program, which hopes to accelerate the development of more abundant, affordable and reliable clean energy solutions within this decade.
Among Chinese stocks, the three education stocks that plunged on Monday – GaoTao (Followers), New Oriental and Good Future – had mixed performances, with GaoTao closing higher and the latter two continuing to close lower, while 51Talk, which turned higher during Monday’s session, continued to close higher. And online education brand Palm Education (ZME) rose double-digit high on its first day of listing in the US.
Cryptocurrencies like bitcoin both plunged double-digits intraday after the U.S. Department of Justice announced the recovery of a portion of the ransom paid to the hacker group by Colonial Pipeline, the nation’s largest fuel pipeline. Some analysts believe that the DOJ’s action proves that cryptocurrencies are not assets beyond the government’s control. Commentary also suggested that IRS Commissioner Charles Rettig’s call for Congress to give the IRS greater authority to regulate cryptocurrencies and require users to disclose more information was a factor in the extended intraday cryptocurrency declines. However, MicroStrategy, a business intelligence software giant that aims to raise money to hold more bitcoin, raised the size of its debt offering, which eased market concerns about regulation. Some technical analysis points out that bitcoin could suffer a selloff once it falls further toward $30,000 and below that mark because of the lack of technical support between $20,000 and $30,000.
The dollar index, which fell off a three-week high on Monday, rebounded. Commentary said that after Yellen’s speech, concerns remain that the Fed may begin to set tapering QE bond purchases at next week’s meeting.
In commodities, gold and other precious metals fell along with the dollar’s recovery; crude oil rebounded, with U.S. oil rising above $70 for the first time in more than two and a half years, and the U.S. Energy Information Administration (EIA) raised this year’s WTI and Brent oil price estimates to $61.85 per barrel and $65.19 per barrel, respectively, up 5% and 4.7% from May’s estimated price, while traders expect that the U.S. last week’s release on Wednesday EIA crude oil inventories will fall for the third consecutive week; copper and other industrial metals rose. Commentary said that although copper rallied on optimism of economic recovery, but low volume and may further downside in the future.
In European markets, although the auto sector, which had been rising for days, retreated and the banking sector was lower due to the retreat in European debt yields, travel stocks and real estate stocks supported the pan-European stock index to continue to record highs. After the announcement of domestic factory orders in April unexpectedly fell instead of increasing from a year earlier, the German stock index continued to fall back, falling away from the record high.
Nasdaq hits three-day, one-month high, Dow in two-straight losses Energy sector leads S&P up New retailer favorite CLOV soars Biotechs retreat, most electric car stocks outside Tesla rise again
In commodities, gold and other precious metals fell along with the dollar’s rally; crude oil rallied, with U.S. oil rising above $70 for the first time in more than two and a half years, and the U.S. Energy Information Administration (EIA) raised this year’s WTI and Brent oil price estimates to $61.85 per barrel and $65.19 per barrel, respectively, up 5% and 4.7% from May estimates, while traders expect the U.S. last week’s release on Wednesday EIA crude oil inventories will fall for the third consecutive week; copper and other industrial metals rose. Commentary said that although copper rallied on optimism of economic recovery, low volume could lead to further downside in the future.
The three major U.S. stock indexes opened higher and lower in early trading, the Nasdaq Composite Index was the best relative performer, hitting two consecutive intraday highs since May 3 at the beginning of the session, up more than 0.7% during the day, only turning down briefly at the end of the morning session. The S&P 500 and the Dow Jones Industrial Average turned down less than half an hour after the opening bell and at the beginning of the session, respectively, and both set new daily lows at the end of the morning session. S&P early in the day to refresh the second highest intraday in history, second only to the intraday high set on May 7, up more than 0.2% during the day, down more than 0.4% when refreshing the daily low, and turned up at lunchtime. The Dow had risen nearly 30 points at the beginning of the session, down nearly 180 points when the new daily low, and had turned up in the afternoon session.
Finally, the three major indices closed mixed, the Dow fell for two days in a row, the Nasdaq rose for three days, the S&P rebounded. The Dow closed down 30.42 points, or 0.09%, at 34,599.82 points, falling further away from the closing high set on Friday since May 10. The S&P closed up 0.02% at 4227.26 points, approaching the second-highest close ever set last Friday. The Nasdaq closed up 0.31% at 13,924.91, a new closing high since April 30, and a new high since May 3 for the second consecutive session as of Monday.
Small-cap stocks outperformed the three major stock indexes for two consecutive days, with the value stock-dominated small-cap index Russell 2000 closing up 1.06%, closing up more than 1% for the second consecutive day. The technology-heavy Nasdaq 100 index closed up 0.06%.
Of the 11 major sectors of the S&P 500, five closed lower and six closed higher on Tuesday. Up in the sector, up nearly 1% of non-essential consumer goods and up nearly 0.9% of the energy leader, the bottom of the rise was a slight gain in information technology, real estate, health care and materials rose 0.1% to 0.5% or so. Among the declining sectors, utilities, down more than 0.9%, and consumer staples, down more than 0.8%, led the decline, with the smallest decline being in financials, down 0.2%.
Among retail holdout stocks, health insurance startup Clover Health (CLOV), which was hotly debated on Reddit’s retailer forum WallStreetBets (WSB), rose 109% at one point during Tuesday’s session, closing up nearly 86% to close at a record high. Media said more than 10 million users have discussed the stock on WSB. GameStop (GME) rose more than 7% and Koss Electronics (KOSS) rose more than 2%.
Leading technology stocks were mixed, Tesla had risen nearly 3% at the beginning of the session, turned down in early trading and closed down 0.25%. FAANMG six major technology stocks, Amazon rose more than 2% to lead the gains, Apple rose nearly 0.7%, the beginning of the session that turned down Facebook closed down nearly 0.9%, Microsoft and Nifty turned down in the middle of the session closed down nearly 0.5%, the end of the session turned down Google parent company Alphabet closed down nearly Google parent company Alphabet closed down nearly 0.2%.
Unlike Tesla, most other new energy vehicle concepts continued to close higher. canoo rose more than 20%, Workhorse rose nearly 11.8%, Tucson future rose 17%, ideal car rose more than 6%, Nikola rose more than 5%, Xiaopeng car rose more than 3%, while Lordstown fell 16%, Azera car fell 0.3%.
Biotechnology stocks, Biogen (BIIB), which closed up more than 38% on Monday, closed down 0.12%, Biogen’s Japanese partner Eisai, which closed up more than 56% on Monday, closed down nearly 10%, and the Nasdaq Biotechnology Index (NBI) closed slightly lower by 0.09%. Most chip stocks fell, with Micron Technology down 4% and the semiconductor sector ETF down nearly 0.6%.
Among Chinese stocks, Cheetah Mobile, Dada, Douyu and Tiger rose more than 10%. Among education stocks, Palm Education (ZME) opened up more than 50% on its first day of trading and closed up nearly 44%. 51Talk, which closed up more than 9% on Monday, closed up nearly 15% on Tuesday, Gao Tu (with who learns), which fell more than 10% during Monday’s session and closed down 0.4%, closed up more than 6%, New Oriental, which fell more than 12% during Monday’s session and closed down 3.8%, fell nearly 16% during Monday’s session and closed down more than 6%, and Good Future, which closed down more than 0.1%.
In Europe, the pan-European stock index rose for three consecutive days, the European Stoxx 600 index for three consecutive trading days to a record closing high. Various sectors, up more than 1.8% of the travel and leisure sector led the rise, followed by a rise of more than 1.1% of the real estate, even up six days of automotive and parts fell more than 1%, and fell nearly 1% of the bank led the market. Major European stock indexes on Tuesday varied, German stocks fell for two days, falling further away from the closing record highs set on Friday, Italian stocks ended a five-day winning streak, Western stocks retracted part of the week’s gains, while British and French stocks rose for three days.
The U.S. dollar index rebounded and cryptocurrencies collectively fell more than 10% during the day. Bitcoin approached $31,000 intraday to hit a near three-week low
The ICE US Dollar Index (DXY), which tracks the exchange rate of a basket of six major currencies, rebounded on Tuesday, rising above 90.10 in the European stock market once approaching 90.18 to set a new daily high, up 0.25% during the day, and rose above 90.60 on Friday to approach 90.63 intraday highs set since May 13 are still far away, with the European and American trading sessions generally above 90.00.
By Tuesday’s U.S. equity close, the dollar index was near 90.12 to 90.117, up 0.19%; the Bloomberg Dollar Spot Index was up 0.1%.
Bitcoin (BTC) fell below $32,000 in the early U.S. stock market, the lowest intraday approaching the $31,000 mark, hitting a new intraday low since May 19, down more than $3,000 from the intraday high in the early Asian market, with some platforms such as Cryptocurrency falling more than $4,000 from the intraday high, down more than 10 percent in 24 hours, with the largest intraday percentage drop of more than 13 percent, the U.S. stock market regained $32,000 at midday The decline narrowed, with U.S. stocks closing below $32,900, down nearly 8% in the last 24 hours.
Ether (ETH), the second-largest cryptocurrency after Bitcoin in terms of market capitalization, had approached the $2,300 mark in early U.S. trading, hitting a new intraday low since late May and falling more than 10% from the intra-day high, before the decline also narrowed, with U.S. stocks closing slightly below $2,500, down more than 8% in 24 hours.
CoinMarketCap data shows that the mainstream cryptocurrencies all fell more than 10% during Tuesday’s session, and the declines were narrowed by the end of the day. Cardano (ADA) and the 12th largest cryptocurrency Bitcoin Cash (BCH) are down more than 7%, and the seventh largest cryptocurrency Ripple (XRP) is down nearly 7%.
European and U.S. Treasuries rebound 10-year U.S. bond yields fall below 1.52% intraday to hit a one-month low
European Treasuries rebounded in price on Tuesday as yields retreated. The yield on the benchmark 10-year U.K. Treasury note fell 3.6 basis points to 0.770% during the day; the yield on the German bund fell 2.6 basis points to -0.224% during the same period. Countries in the Italian bond yields fell the most, down 5.3 basis points during the day, the country’s syndicate debt demand is strong, 10 billion euros bond tender sale to get more than 65 billion euros subscription.
U.S. bond yields also fell back. U.S. 10-year benchmark Treasury yields had accelerated downward after European stocks fell below 1.56% during the day, once below 1.52%, a new intraday low since May 7, down more than 5 basis points during the day, U.S. stocks regained 1.53% in early trading, to about 1.53% at the close of U.S. stocks, down 4 basis points during the day.
Crude oil hits at least a two-year high for the second time in three days U.S. oil rises above $70 for the first time in two and a half years
After a brief pullback on Monday, international crude oil futures resumed their momentum to set new highs of at least two years.
U.S. WTI July crude oil futures closed up 1.18% at $70.05 per barrel, a new closing high for the main contract since Oct. 16, 2018, and the first time since October 2018 that it closed above the $70 mark. Brent August crude oil futures closed up 1.02% at $72.22/barrel, a new closing high for the main contract since May 16, 2019.
U.S. oil closed at a new high since October 2018 last Tuesday, Wednesday and Friday, and Brent oil closed at a new high since May 2019.
Gold ended a two-session positive streak and turned lower after regaining $1,900 intraday in the short term Copper rallied but failed to regain $10,000 in four days Tin broke $31,000 for the first time in a decade
New York gold, silver and platinum futures ended a two-day winning streak. comex August gold futures had risen above $1,900 in early Asian trading to approach $1,907 to set a new daily high, but European shares turned lower during the session and finally closed down 0.2% at $1,894.40 per ounce, although not close to the May 14 low set last Thursday when it fell below $1,880, but has closed for four consecutive days at below $1,900.
New York silver futures, which had just regained $28 on Monday, fell $28 to close down 1%. Platinum futures closed down nearly 1.1 percent. Palladium fell for the second day in a row, closing down 1.1 percent.
London base metals futures, which were mostly down on Monday, rebounded on Tuesday, led by a nearly $700, or more than 2 percent, gain in LON tin. LON tin closed at $31,223 per ton, rising above $31,000 for the first time in a decade and hitting a 10-year high for the second time in the last three trading days. Copper erased Monday’s losses to close at $9,964 per tonne, still unable to recover the $10,000 mark, closing below $10,000 for the fourth consecutive session. Aluminum and zinc erased most of Monday’s losses. Lunar nickel is in danger of falling to a more than one-week low. Lunar aluminum rose for the second day in a row.