On Monday, US stock market ended lower in thin year-end trading, with all three major indices closing in the red. The Dow Jones Industrial Average dropped over 400 points, while the S&P 500 and Nasdaq both fell by more than 1%. Tesla marked its third consecutive daily decline. During this period, some investors opted to “lock in profits,” while others stayed on the sidelines, awaiting better entry points.
Despite hopes for a post-Christmas “Santa Rally,” US stocks failed to gain momentum. Low market participation during the holidays led to reduced trading volume as many Wall Street professionals remained on holiday. Goldman Sachs traders noted that US pension funds are expected to sell an estimated $2.7 billion in equities for year-end rebalancing, a figure higher than 87% of historical levels for the same period. Liquidity has also significantly declined compared to two weeks ago.
Investors continued to monitor rising US Treasury yields. Quasar Elizundia, a research strategist at Pepperstone, commented, “The persistent rise in bond yields, driven by a reassessment of monetary policy expectations, has raised concerns. The Federal Reserve may maintain tighter monetary policy for longer than anticipated, potentially weakening corporate earnings growth projections for 2025, which could affect investment decisions.”
As 2024 draws to a close, all three major US indices remain near record highs. Year-to-date, the S&P 500 and Dow have gained approximately 24% and 13%, respectively, while the Nasdaq has surged nearly 30%, reflecting strong performance.
US Market Overview
Major Tech Stocks
Most major tech stocks declined.
- Losers: Tesla fell over 3%, while Apple, Microsoft, Amazon, and Meta all dropped more than 1%. Google and Netflix posted small losses.
- Gainers: NVIDIA rose slightly.
Housing Finance Stocks
Fannie Mae soared over 36%, and Freddie Mac jumped more than 33%. These gains were fueled by optimism that the two companies might exit federal conservatorship under a potential Trump administration, sparked by a social media post from Bill Ackman.
Faraday Future (FFIE)
Faraday Future rallied over 78% during regular trading and extended its gains by more than 23% after hours. On December 30, the company announced that prominent entrepreneur Luke Hans would take delivery of his FF 91 2.0 Futurist Alliance EV in mid-January 2025. The company plans a special delivery ceremony in Los Angeles, with FF executives in attendance.
Chinese ADRs
Chinese ADRs traded mostly lower, with the Nasdaq Golden Dragon China Index falling 1.9%.
- Losers: Kingsoft Cloud dropped over 8%, XPeng Motors fell more than 6%, and Li Auto declined over 4%. Zeekr and Pinduoduo lost more than 3%, while Baidu, NetEase, Bilibili, and NIO fell over 2%. JD.com, Yum China, and Alibaba declined more than 1%.
Technical Analysis
Market Recap
- Dow Jones: Fell 418.48 points (-0.97%) to 43,573.73.
- Nasdaq Composite: Dropped 235.25 points (-1.19%) to 19,486.78.
- S&P 500: Declined 63.90 points (-1.07%) to 5,906.94.
Hong Kong Market Overview
On the final half-day of 2024 trading, Hong Kong’s major indices closed mixed.
- Sector Highlights
- Tech stocks: JD.com gained nearly 1%, while Baidu fell more than 1%.
- Semiconductors: Semiconductor stocks retreated, with SMIC down more than 2%.
- Brokerage stocks: Brokerages declined, with China Merchants Securities falling over 2%.
- Energy stocks: Coal and oil stocks led gains, with China Shenhua Energy up more than 3% and Sinopec rising nearly 2%.
- Consumer stocks: Sectors like dairy, home appliances, and beer showed strong performance.
2024 Yearly Performance
- Hang Seng Index: +17.67%
- Hang Seng Tech Index: +18.7%
- Hang Seng China Enterprises Index: +26.37%
Standout performers included:
- Technology: Stocks like Kingsoft Cloud, GDS, and Xiaomi all rose over 100% this year.
- Semiconductors: SMIC gained nearly 60%.
- Energy: CNOOC climbed almost 60%.
- Finance: China Merchants Securities surged over 166%.
Meanwhile, real estate and healthcare sectors underperformed amid industry adjustments.
Technical Analysis
Market Recap
- Hang Seng Index: Rose 0.09% to 20,059.95.
- Hang Seng Tech Index: Fell 0.72% to 4,468.11.
- Hang Seng China Enterprises Index: Gained 0.13% to 7,289.89.
A50 & China A-Shares Overview
China’s A-share indices opened lower and extended losses by midday. Total turnover was 803.6 billion yuan, down 32.8 billion yuan from the previous session, with over 4,000 stocks declining.
Sector Highlights
- Gainers: Cultivated diamonds, natural gas, coal, and retail consumer sectors led gains.
- Decliners: Copper cable, brain-computer interface, semiconductors, and brokerage stocks were the biggest laggards.
Notable Performers
- Natural Gas: Stocks like Changchun Gas and Guizhou Gas hit their daily limit-up.
- Retail Consumer: Companies like Dongbai Group, Youhao Group, Zhongbai Group, Jinhe Commercial Management, Huangtai Wine, and Rhine Sports also hit their limit-up.
- Semiconductors: CPO and copper cable stocks slumped, with Xiangying Technology dropping over 10%, while Derun Electronics hit limit-down. Key names like Huafeng Technology, Taichen Light, and Zhongji Xuchuang lost over 5%.
- Brokerages: Lagging behind, with Huaxin Shares and Hualin Securities falling more than 4%, and Xinda Securities, Shanxi Securities, and Guoyuan Securities also declining.
Technical Analysis
Market Recap
- Shanghai Composite (SSE): Fell 0.59% to 3,387.15.
- Shenzhen Component (SZSE): Declined 1.26% to 10,536.60.
- ChiNext (Growth Enterprise Market Index): Dropped 1.56% to 2,171.88.
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Disclaimer
This information contained in this blog is for general reference only and is not intended as investment advice, a recommendation, an offer, or an invitation to buy or sell any financial instruments. It does not consider any specific recipient’s investment objectives or financial situation. Past performance references are not reliable indicators of future performance. Doo Prime and its affiliates make no representations or warranties about the accuracy or completeness of this information and accept no liability for any losses or damages resulting from its use or from any investments made based on it.
The above strategies reflect only the analysts’ opinions and are for reference only. They should not be used or considered as the basis for any trading decisions or as an invitation to engage in any transaction. Doo Prime does not guarantee the accuracy or completeness of this report and assumes no responsibility for any losses resulting from the use of this report. Do not rely on this report to replace your independent judgment. The market is risky, and investments should be made with caution.
