<ol>
<li>Before the U.S. stock market opened on May 23 (Thursday), the futures of the three major U.S. stock indexes all rose. As of the time of publication, the Dow Jones futures rose by 0.12%, the S&amp;P 500 index futures rose by 0.65%, and the Nasdaq futures rose by 1.06%.</li>
</ol>
<img src="https://pub.pbkrs.com/uploads/2024/6d27ee1406517df776d655281fffa456?x-oss-process=style/lg" alt="image.png" original-src="https://pub.pbkrs.com/uploads/2024/6d27ee1406517df776d655281fffa456"/>
<ol>
<li>As of the time of publication, the Germany DAX index rose by 0.24%, the UK FTSE 100 index rose by 0.00%, the France CAC40 index rose by 0.31%, and the Euro Stoxx 50 index rose by 0.51%.</li>
</ol>
<img src="https://pub.pbkrs.com/uploads/2024/9d1339bd5409ba3c272d24bfee1ec924?x-oss-process=style/lg" alt="image.png" original-src="https://pub.pbkrs.com/uploads/2024/9d1339bd5409ba3c272d24bfee1ec924"/>
<ol>
<li>As of the time of publication, WTI crude oil rose by 0.73% to $78.14 per barrel. Brent crude oil rose by 0.71% to $82.48 per barrel.</li>
</ol>
<h2>Market News</h2>
JP Morgan CEO: U.S. Economy May Face &#34;Hard Landing&#34;, Worst Outcome Would Be Stagflation. Jamie Dimon, Chairman and CEO of JP Morgan, stated that the U.S. economy may experience a &#34;hard landing&#34;. Dimon mentioned that the worst outcome for the U.S. economy would be &#34;stagflation&#34;, where inflation continues to rise but economic growth slows down with high unemployment rates. He said, &#34;I see a series of outcomes, and the worst outcome for all of us is stagflation, high interest rates, and a recession. That means corporate profits go down, we'll all get through it. I mean, the world has been through this before, but I think the likelihood is higher than people think.&#34; However, he noted that even in a recession, &#34;consumers are in good shape&#34;. He pointed out that the unemployment rate has been below 4% for about two years and added that wages, home prices, and stock prices have been rising.
Goldman Sachs Sounds Alarm: U.S. Debt Servicing Costs Ratio to Rise to Dangerous Levels. Goldman Sachs updated its long-term U.S. fiscal outlook on Wednesday, expecting a key indicator of debt sustainability to rise to historically extreme levels. Goldman economists Manuel Abecasis and David Mericle wrote in the report, &#34;Over the past five years, the outlook for U.S. fiscal sustainability has become more challenging.&#34; &#34;In particular, the expected rise in future interest rates has significantly worsened the trajectory of the debt-to-GDP ratio and the share of actual interest payments in GDP.&#34; U.S. Treasury Secretary Janet Yellen has repeatedly used the adjusted net interest expense-to-GDP ratio as a key measure of debt sustainability. Last year, she stated that a 1% ratio is &#34;absolutely fine, nothing to worry about.&#34;
Goldman Sachs' latest forecast shows that by 2034, this ratio will steadily rise to 2.3%.
Fed Meeting Minutes: Hawkish Tone, Slight Decline in U.S. Treasuries. The minutes of the May Federal Reserve meeting released on Wednesday showed that several policymakers questioned whether the policy was strict enough to bring inflation down to the target level. As a result, U.S. Treasuries fell, with short-term Treasuries leading the decline. Data shows that the yield on the two-year U.S. Treasury rose by about 5 basis points to 4.88%; the yield on the ten-year U.S. Treasury rose by 1 basis point to 4.43%. The minutes indicated that although participants assessed the policy as &#34;well-positioned,&#34; several policymakers mentioned that they would be willing to further tighten monetary policy if necessary. However, the discussions mentioned in the minutes took place before the release of the U.S. CPI data for April. This inflation data showed a cooling of price pressures for the first time in 6 months, which helps explain the relatively mild market reaction.
Hedge Funds Sound the Alarm: Should Not Be Blindly Optimistic Due to Fed Rate Cuts, U.S. Stocks Still Face &#34;Largest Bubble in History&#34; Risk. Mark Spitznagel, Chief Information Officer and founder of the $16 billion hedge fund Universa, referred to hopes based on rate cuts as a &#34;cautious situation&#34; in an interview with foreign media. The fund focuses on risk mitigation in the face of &#34;black swan&#34; events. Nassim Nicholas Taleb, who wrote &#34;The Black Swan&#34; before the 2008 financial crisis, serves as an advisor to Universa Fund. He described black swan events as &#34;extremely rare, to the point of being unknown in probability,&#34; and &#34;once they occur, they have catastrophic effects,&#34; making them seem predictable in hindsight.
<h2>Individual Stock News</h2>
AI Craze Continues! NVIDIA (NVDA.US) Q1 Profit Increases 6-Fold! Announces &#34;1-for-10&#34; Stock Split. NVIDIA's Q1 revenue reached $26 billion, a 262% year-on-year increase, exceeding market expectations of $24.7 billion; net profit was $14.88 billion, a 628% year-on-year increase; earnings per share excluding certain items were $6.12, exceeding market expectations of $5.65. The data center segment is currently NVIDIA's largest revenue source, generating $22.6 billion in revenue, a 427% year-on-year increase, exceeding market expectations of $21 billion; the gaming segment revenue was $2.6 billion, an 18% year-on-year increase, in line with market expectations of $2.6 billion. NVIDIA expects second-quarter revenue to reach around $28 billion, surpassing market expectations of $26.8 billion. NVIDIA announced a &#34;1-for-10&#34; stock split and increased its quarterly dividend by 150% to $0.10 per share.
Bilibili (BILI.US) Achieves Total Net Revenue of RMB 5.665 Billion in the First Quarter, a 12% Year-on-Year Increase, with Monthly Active Users Reaching a New High. Bilibili's total net revenue in the first quarter reached RMB 5.665 billion ($785 million), a 12% year-on-year increase
Net profit was RMB 1.605 billion (USD 222 million), a year-on-year increase of 45%. The gross profit margin reached 28.3%, an increase from 21.8% in the same period last year. Adjusted net loss was RMB 456 million (USD 63.10 million), a year-on-year decrease of 56%. Operating cash flow in the first quarter of 2024 was RMB 638 million (USD 88.30 million), compared to an outflow of operating cash flow of RMB 630 million in the same period last year.
Beike (BEKE.US) achieved an adjusted net profit of RMB 1.392 billion in the first quarter. Beike's total transaction volume in the first quarter was RMB 629.9 billion (USD 87.2 billion), a year-on-year decrease of 35.2%. The total transaction volume of existing home transactions was RMB 453.2 billion (USD 62.8 billion), a year-on-year decrease of 31.8%. The total transaction volume of new home transactions was RMB 151.8 billion (USD 21.0 billion), a year-on-year decrease of 45.4%. The total transaction volume of home decoration and furnishings was RMB 3.4 billion (USD 0.5 billion), an increase of 26.1% year-on-year. The total transaction volume of emerging businesses and others was RMB 21.5 billion (USD 3.0 billion), a year-on-year decrease of 19.3%.
Synopsys (SNPS.US) missed Q2 revenue expectations and raised full-year guidance. Synopsys' second-quarter revenue was USD 1.455 billion, a 15% year-on-year increase, falling short of analysts' consensus expectations. Non-GAAP diluted earnings per share were USD 3.00, a year-on-year increase of approximately 26%, also missing analysts' consensus expectations. By region, the company's revenue share in the North American market was the largest, reaching USD 6.382 billion, accounting for 44% of total revenue. Looking ahead, Synopsys CFO Shelagh Glaser stated that Synopsys will raise its full-year revenue and Non-GAAP earnings per share targets. The company expects third-quarter revenue in 2024 to be between USD 1.505 billion and USD 1.535 billion, full-year revenue in 2024 to be between USD 6.09 billion and USD 6.15 billion, and third-quarter Non-GAAP earnings per share to be between USD 3.25 and USD 3.30, with full-year 2024 earnings per share between USD 12.90 and USD 12.98.
Accelerating AI strategy pays off! Snowflake (SNOW.US) sees 33% year-on-year revenue growth in Q1, Q2 product revenue guidance exceeds expectations. Snowflake's first-quarter product revenue increased by 34% to USD 789.6 million, surpassing analysts' expectations of USD 749 million. Total revenue for the first quarter was USD 829 million, a 32.9% year-on-year increase, compared to analysts' expectation of USD 786 million. Non-GAAP earnings per share were 14 cents, while analysts expected 19 cents. The company stated in a statement on Wednesday that as of July, product revenue, the main source of total revenue, is expected to reach USD 805 million to USD 810 million, with analysts' average expectation at USD 787.5 million
The company also raised its product sales forecast for the current fiscal year from $3.25 billion to $3.3 billion.
Hesai Technology (HSAI.US) Q1 Financial Report Released: ADAS Business Shows Steady Growth, Secures New International Designations. In the first quarter, Hesai Technology achieved a revenue of 360 million RMB; the total delivery of LiDAR reached 59,101 units, a year-on-year increase of 69.7%; among them, the delivery of ADAS products was 52,462 units, a year-on-year increase of 86.1%. The combined gross profit margin of Robotaxi business and ADAS business was 38.8%, demonstrating excellent operational efficiency and commercial capabilities. According to the relevant person in charge of Hesai, &#34;The company expects to be profitable in Q4.&#34; This quarter, Hesai reached mass production cooperation agreements for LiDAR with two global top ten international automakers, including a globally mass-produced model from a top international automotive brand. Among them, many international customers who had previously cooperated with other industry peers have turned to choose Hesai.
Agora (API.US) Q1 Revenue $33.021 million, EPS -$0.05. Agora's Q1 2024 financial report achieved revenue of $33.021 million, down from $36.443 million, with an expected value of $42 million; EPS was -$0.05, down from -$0.09, with an expected value of -$0.09.
NetEase (NTES.US) Q1 Net Revenue of 26.9 billion RMB, Leading the Industry with R&amp;D Intensity Exceeding 15% for 7 Consecutive Quarters. NetEase's Q1 revenue was 26.9 billion RMB, with a net profit attributable to company shareholders of 8.5 billion RMB (Non-GAAP), leading the industry with R&amp;D investment intensity exceeding 15% for 7 consecutive quarters, starting the first quarter steadily. NetEase Cloud Music strengthened original content support, self-produced music, and copyright acquisitions, continuously enhancing its content influence. NetEase Youdao focused on the development of three high-potential AI-driven businesses, with revenue of 1.4 billion RMB and significantly improved profits. The innovation segment generated revenue of 2 billion RMB, with NetEase Media accelerating AI service integrated media and UGC creation, and the proportion of UGC content on the NetEase News app increased by 30.5% year-on-year. NetEase has maintained a high level of R&amp;D investment for a long time, promoting cross-industry empowerment through technology.
Youdao (DAO.US) Q1 2024 Multiple Financial Indicators Exceed Market Expectations, Accelerating the Commercialization Process of Generative AI. Benefiting from the dual drive of &#34;AI&#34; and &#34;Education,&#34; Youdao's performance exceeded market expectations, with a significant improvement in business health. The financial report shows that NetEase Youdao's net revenue in the first quarter reached 1.39 billion RMB, a year-on-year increase of 19.7%. Operating profit reached 30 million RMB, achieving profitability for two consecutive quarters for the first time. Under non-GAAP, the net profit attributable to NetEase Youdao in this quarter was 20 million RMB, turning losses into profits year-on-year. Operating cash flow improved by 10.5% compared to the same period last year
Weibo (WB.US) reported a net profit attributable to shareholders of $49.438 million in the first quarter, a year-on-year decrease of 50.8%. Weibo announced its financial performance for the first quarter of 2024, with a net revenue of $395.5 million, a 4% year-on-year decrease or flat when calculated at fixed exchange rates. The net profit attributable to Weibo shareholders was $49.438 million, a 50.8% year-on-year decrease, and a 40.6% decrease from the previous quarter. Basic earnings per share were $0.21. As of March 2024, the monthly active users of Weibo were 588 million, with daily active users at 255 million. As of March 31, 2024, Weibo's total cash, cash equivalents, and short-term investments amounted to $3.3 billion.
1 Drugstore (YI.US) achieved a revenue of 3.53 billion yuan in the first quarter, achieving comprehensive profitability at the operating level for the first time. Drugstore recorded a revenue of 3.53 billion yuan in the quarter; Non-GAAP operating profit was 8.9 million yuan, while achieving positive GAAP operating profit for the first time, with GAAP operating profit reaching 3.72 million yuan, and positive operating cash flow, marking an important milestone for 1 Drugstore to achieve profitability.
<h2>Important Economic Data and Event Preview</h2>
20:00 Beijing Time: US Building Permits MoM (%).
20:30 Beijing Time: US Initial Jobless Claims for the week ending May 18 (in thousands).
21:45 Beijing Time: US May SPGI Manufacturing PMI Flash.
22:00 Beijing Time: Eurozone May Consumer Confidence Flash, US April Seasonally Adjusted New Home Sales Annualized (in thousands).
23:00 Beijing Time: US May Kansas Fed Manufacturing Index.
01:00 Beijing Time the next day: US May 23 10-Year TIPS Auction - Total Amount (in billion USD).
03:00 Beijing Time the next day: 2024 FOMC Voter, Atlanta Fed President Bostic participates in a student Q&amp;A session.
<h2>Earnings Forecast</h2>
Friday Morning: Ross Stores (ROST.US), LexinFintech Holdings (LX.US), Huize Holding Limited (HUIZ.US)

.IXIC

.DJI

Goldman Sachs warns that the US debt cost ratio may rise to dangerous levels

US Stock Market Outlook | Three major stock index futures rise together, Morgan Stanley CEO warns of a possible hard landing for the US economy