Market Insights: May 22nd, 2024

Commodity Market

• Crude Oil and Precious Metals Price Changes:

1. Crude oil prices continued to decline, dropping by 2% intraday, distancing from this month's high.
2. New York gold futures and LME copper prices retreated, with the former falling from a record high and the latter hitting a historical high for three consecutive days.
3. Bitcoin approached $72,000 intraday, marking a six-week high, but later fell nearly $3,000; Ethereum saw intraday gains of over 10%.

China Market

• Chinese Concept Stocks and RMB Exchange Rate:

1. During the US trading session, the Chinese concept stock index fell more than 2%, dropping for two consecutive days to the lowest point in over a week. XPeng Motors surged by 26% at one point, ultimately closing up 6%; Li Auto decreased by 3.5% the day after their earnings report was announced.
2. Offshore RMB briefly approached 7.25 intraday, hitting a nearly three-week low before closing flat.

• A-Share Market:

1. On Wednesday, the three major A-share indices showed mixed performance. The Shanghai Composite Index slightly declined by 0.02% to 3,157.19 points; the Shenzhen Component Index fell by 0.07% to 9,674.5 points; the ChiNext Index rose by 0.09% to 1,863.14 points; and the STAR 50 Index increased by 0.22% to 749.91 points. The total transaction value of the Shanghai and Shenzhen markets reached 57.25 billion yuan.
2. In terms of sectors, the medical beauty and assisted reproduction sectors saw significant gains, while the civil explosives, electrode foil/copper-clad laminate, and viscose staple fiber sectors experienced substantial declines.

• Hong Kong Stock Market:

1. The Hang Seng Index fell by 0.28%, and the Hang Seng Tech Index dropped by 0.4%.
2. China-Thailand International believes that the current valuation of Hong Kong stocks has significantly recovered, with the Hang Seng Index and MSCI China Index risk premiums being below the two-year rolling average by two standard deviations, indicating a technical overbought condition. Reduced expectations of policy catalysts may shift the market from a unilateral rise to high-level fluctuations.

International Market

• US Stocks and Tech Companies:

1. US stocks performed well, with both the S&P 500 and the Nasdaq achieving record closing highs. Google's parent company Alphabet reached a historical high, and Tesla surged more than 6% at the close.
2. A Federal Reserve official mentioned the need for more months of inflation data to confirm rate cuts. There were also reports that an Ethereum ETF might be listed, causing Ethereum to rise by over 20% at one point.

• Canadian Government Bonds and US Treasury Yields:

1. The latest data showed that Canada's CPI year-over-year increase had dropped to a three-year low, leading Canadian government bonds to outperform.
2. The benchmark 10-year US Treasury yield also fell by over 3 basis points, as Federal Reserve Governor Waller described the recently released US inflation report as "a reassuring sign".

• UK CPI Data:

The UK is set to release similarly crucial CPI data today.

Regulations and Policies

• EU AI Regulation Act:

1. The EU Council approved the world's first regulation for artificial intelligence (AI), with fines of up to 35 million euros or higher. The act uses "risk" as the regulatory standard, with higher-risk AI systems facing more stringent requirements and restrictions.
2. The rules mainly apply to commercial AI services and applications, with possible exemptions for military or research use depending on the circumstances. Companies penalized under the new act could face fines of 35 million euros or up to 7% of their annual global revenue, whichever is higher.

Corporate News

• Disney's Pixar Animation Studios Layoffs:

Disney's Pixar Animation Studios, known for classics like "Toy Story," began laying off about 14% of its staff on Tuesday, affecting approximately 175 employees.

Futures Market

• COMEX Futures Contracts:

1. As of the close on May 21, COMEX June gold futures contract was reported at $2,425.2/ounce, down 0.55%, with a trading volume of 225,980 contracts and an open interest of 207,262 contracts.
2. On the same day, the COMEX July silver futures contract was reported at $32.205/ounce, down 0.68%, with a trading volume of 107,064 contracts and an open interest of 151,374 contracts.