Market Insights: Feb 27th, 2024

Stock Market Situation:

• Today's A-share market opened lower in the morning session but then oscillated and rose. The indices of both Shanghai and Shenzhen markets showed a slight upward trend overall. Specifically, the Shanghai Composite Index increased by 0.28%, to 2985.45 points; the Shenzhen Component Index went up by 0.09%, to 9073.80 points; while the ChiNext Index slightly fell by 0.12%, to 1749.68 points.
• Performance varied across industry sectors, with unified big-market, automotive industry chain, breeding, education, and other sectors leading the gains, while state-owned enterprise cloud, AI chips, Sora, CRO, and other sectors saw declines. In terms of individual stocks, more rose than fell, with nearly 3000 stocks advancing in the two markets and transaction volume reaching 235.2 billion yuan within the first half hour of opening.
• On Monday (the previous trading day), the U.S. stock market performed weakly, with all three major indices closing lower. The S&P 500 dropped by 0.38%, the Nasdaq by 0.13%, and the Dow by 0.16%. Technology stocks led the declines, especially Alphabet, Google's parent company, which had the largest drop in stock price, affecting the overall performance of the technology sector.

Financial Market:

• The U.S. bond market faced poor demand from investors, causing the yield on Treasuries to rise to a recent high. Meanwhile, the U.S. dollar index neared a two-week low during the session.
• The price of Bitcoin rose by more than $3000 during the day's trading, hitting a level of $55,000, reaching a new high of more than two years.
• Oil prices rebounded by more than 1%, with U.S. crude oil prices leaving behind a two-week low. However, gold prices fell from a high of two weeks prior. Simultaneously, prices for non-ferrous metals such as London copper, nickel, and tin also fell, with tin in particular setting a two-week new low.

Pharmaceutical Industry:

• Danish pharmaceutical company Zealand's phase II trial of a new drug was successful, causing its stock price to surge by 36%.

Real Estate Market:

• Although sales of new homes in the U.S. in January grew both year-on-year and month-on-month, house prices have been falling for five consecutive months. Specifically, new home sales reached 661,000 units, below the expected 684,000 units, up by 1.5% month-on-month. However, the supply of new houses in January climbed to 456,000 units, reaching the highest level in more than a year. The median sales price of new houses was $420,700.

Foreign Exchange Market:

• According to statistics from the State Administration of Foreign Exchange, in January 2024, China's foreign exchange market totaled transactions of 24.67 trillion yuan (about 3.47 trillion USD). This includes 3.76 trillion yuan in customer market transactions and 20.91 trillion yuan in interbank market transactions; with spot market transactions accounting for 8.33 trillion yuan and derivatives market transactions for 16.34 trillion yuan.

Ecological Environment:

• Tokyo Electric Power Company announced that it will start the fourth discharge of contaminated water from the Fukushima Daiichi Nuclear Power Station on the 28th.

Hong Kong Stock Market:

• Market rumors suggest that China International Airlines (0753.HK), the second largest shareholder of Cathay Pacific Airways (0293.HK), intends to increase its stake in Cathay Pacific, which led to a 3% rise in Cathay Pacific's stock price against the market trend.

Automotive Industry:

• BYD Company announced its sales target for 2024, initially planning for 4 million vehicles, marking a 32.45% increase from the 3.02 million vehicles sold in 2023. The total production capacity across all BYD bases can reach 4.2 million vehicles, with a similar forecast given to suppliers.