[TrueZhuo Finance] US unemployment rate hits four-year high; Vanke proposes new extension plan
U.S. non-farm payrolls in October recorded the largest decline in five years, while the unemployment rate rose to a four-year high. Vanke proposed to postpone the principal repayment of notes due on December 15 by 12 months.
Overnight Highlights
Nasdaq rebounded and closed higher on Tuesday, but S&P 500 and Dow closed lower, dragged by healthcare and energy stocks. U.S. Treasury yields fell after data showed an unexpected rise in unemployment last month, but distortions from the government shutdown may have made the data less reliable than usual. The dollar retreated against major currencies. Gold prices were flat. Crude oil futures closed at their lowest level since February 2021 as concerns about oversupply persisted and prospects for a peace deal between Russia and Ukraine appeared to strengthen.
International News
U.S. non-farm payrolls in October recorded the largest decline in five years, while November saw a recovery in growth but overall remained weak, with the unemployment rate rising to a four-year high. See: [Market Review] The Fed's Dilemma: Talking Up the Economy While Worrying About Jobs
U.S. retail sales in October were essentially flat, as weak auto and gas station sales offset strength in other categories.
PMI data showed U.S. business activity growth slowed to a six-month low in December, while input price indicators rose to their highest in over three years.
Trump plans to deliver a national address at 9 p.m. ET on Wednesday, with the White House saying he may preview some policies to be rolled out next year.
U.S. Treasury Secretary Besant said there will be one or two more interviews with Fed chair candidates this week, with results likely announced in early January. He also dismissed concerns that Hassett would lack independence as Fed chair.
The U.S. threatened retaliation against the EU's digital services tax, naming companies including Accenture (ACN.US) and Siemens (SIE.DE/SIEGY.US). Washington may also launch a Section 301 investigation, paving the way for tariffs and other actions.
Bank of America's monthly survey showed investor sentiment in December reached its most optimistic level in four and a half years, with total allocations to stocks and commodities rising to their highest since February 2022.
Citadel founder Griffin said Republican policies are exacerbating inflation, but deregulation will ultimately help curb price rises.
The EU relaxed its de facto ban on internal combustion engines, giving automakers more flexibility in transitioning to cleaner transport.
The OECD expects the AI investment boom to boost production, but trade uncertainties remain.
According to The Information, Apple (AAPL.US) will release at least seven new iPhone models in the next two years, with the first foldable phone expected in fall 2026.
Greater China News
Xinhua: Officials from the Central Financial Office said China's economic growth is expected to be around 5% in 2025, with this year's economic and social development targets on track to be achieved. Expanding domestic demand will be the top priority next year.
Vanke (000002.SZ/2202.HK) $CHINA VANKE(02202.HK) proposed to extend the principal repayment of RMB notes due on December 15 by 12 months, with the issuer providing corresponding credit enhancement measures. The company plans to pay the RMB 60 million interest due on December 15 before next Monday.
Luckin Coffee (LKNCY.US) is reportedly considering bidding for Nestlé's (NESN.SW/NSRGY.US) Blue Bottle Coffee chain.
Cryptocurrency exchange HashKey will list in Hong Kong on Wednesday at an issue price of HK$6.68 per share, with the public offering portion oversubscribed nearly 400 times.
China set final tariffs on pork imports from the EU, significantly lower than the preliminary rate of up to 62.4% announced in September.
A Canadian official in charge of fentanyl issues said they hope to work more closely with China to prevent chemicals used to make fentanyl from flowing into North America.
Commodities & Forex
After weak jobs data, the Bloomberg Dollar Index hit its lowest level since early October, with the pound and yen outperforming G-10 currencies.
WTI crude futures fell below $55 a barrel for the first time since 2021 amid oversupply and progress in Russia-Ukraine peace talks, while Brent crude fell below $60.
Spot gold halted a five-day rally as investors digested weak U.S. jobs data.
Earnings & Data Focus
U.S. EIA Crude Oil Inventories (week to Dec 12) (prev: -1812K, est: -2197K)
Eurozone Nov CPI Final YoY (prev: 2.10%, est: 2.2%)
Source: Golden Horse Capital Management (HK) Ltd.
Author: Terry Chow
Proofreader: Gloria Guo
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