US equities closed higher on Tuesday, with tech stocks powering a rebound after a sluggish start to December. Market expectations for a Federal Reserve rate cut at the December meeting strengthened again.
Traders now expect the Fed to announce a rate cut at its policy meeting ending on December 10. According to the CME FedWatch tool, the probability of a cut stands at 87.6 percent, sharply higher than mid-November levels.
Historically, December tends to be a strong month for equities. According to the Stock Trader’s Almanac, since 1950 the S&P 500 has averaged a gain of more than 1 percent in December, making it the index’s third-best month of the year.
US Stocks
By market cap, Tuesday’s closing performance was as follows:
Nvidia +0.86%, Apple +1.09%, Alphabet-A +0.29%, Microsoft +0.67%, Amazon +0.23%, Broadcom –1.17%, Meta +0.97%, TSMC +1.53%, Tesla –0.21%, Berkshire Hathaway-A –0.14%, Eli Lilly –1.11%.
Chinese ADRs broadly moved lower, with the Nasdaq Golden Dragon China Index down 0.65 percent. Alibaba –1.91%, JD.com +0.54%, Baidu –0.6%, Pinduoduo +0.53%, Bilibili –2.71%, NIO –2.9%, NetEase –1.83%, Futu –0.65%, Li Auto +0.89%, XPeng –7.92%, Atour +5.59%, Aihuishou +6.33%.
Market Snapshot
Dow Jones: +185.13 points (+0.39%) to 47,474.46
Nasdaq: +137.75 points (+0.59%) to 23,413.67
S&P 500: +16.74 points (+0.25%) to 6,829.37
Hong Kong Stocks >>
Hong Kong equities opened higher but turned lower by midday. Tech stocks slid across the board: NetEase –3%, Bilibili –2%, Alibaba, Kuaishou, Lenovo, and Tencent all down more than 1 percent.
Non-ferrous metal stocks outperformed, with Chalco rising over 5 percent. Analysts noted that the sharp rally in silver and copper is driving expectations for a year-end sector rotation, with institutional capital increasing allocations to resource leaders benefiting from supply reforms and demand growth.
EV stocks weakened, with XPeng falling more than 3 percent. On December 1, XPeng reported November deliveries of 36,728 units, up 19 percent year-on-year but down 12 percent month-on-month, marking its first monthly decline in six months. The figure also fell short of CEO He Xiaopeng’s target of “stable 40,000+ deliveries starting September.”
Market Snapshot
Hang Seng Index: –0.97% to 25,842.77
Hang Seng Tech Index: –1.30% to 5,550.92
HSCEI: –1.26% to 9,067.40
A50 >>
Mainland China’s major indices fell in early trading.
At midday: Shanghai Composite –0.09%, Shenzhen Component –0.19%, ChiNext –0.50%, Beijing 50 +0.59%.
Total half-day turnover across Shanghai, Shenzhen, and Beijing reached 1.0756 trillion yuan, up 195 billion from the previous session. More than 3,500 stocks declined.
Sector-wise, lab-grown diamonds, coal mining, wind power equipment, airport operators, pharma distribution, industrial metals, and Hainan FTZ outperformed; Zhipu AI, cinemas, energy metals, and gaming declined.
Market Snapshot
Shanghai Composite: –0.09% to 3,894.22
Shenzhen Component: –0.19% to 13,031.26
ChiNext: –0.50% to 3,055.92
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