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Wednesday, October 9

Some of the largest macro moves in the market today include: Copper -1.5%. Some of the largest moves among US mega-cap stocks include: Exxon Mobil Corp (XOM) -0.7%. 

The Federal Reserve's minutes and discussions on potential rate cuts are drawing significant attention, with market participants closely monitoring the economic outlook amid geopolitical events such as Hurricane Milton. The uncertainty surrounding future Fed actions is contributing to fluctuations in financial markets.

In Europe, foreign exchange markets are awaiting US Consumer Price Index (CPI) data amidst ongoing speculations about interest rate adjustments by European Central Bank officials. Additionally, China's finance ministry plans fiscal stimulus announcements for October 12th which could impact global sentiment given recent volatility in Chinese equities due to concerns over insufficient policy measures.

US mortgage rates have risen for the first time in three months alongside Treasury yields reflecting investor expectations that the Federal Reserve may not lower interest rates swiftly. This has coincided with a decline of 5.1% in US mortgage applications from last week indicating reduced demand following strong labor market data influencing monetary policy anticipations.

Vanguard FTSE Emerging Markets ETF (VWO) [-1.3%]
The Vanguard FTSE Emerging Markets ETF (VWO) has seen a decline of 1.3% in pre-market trading on Wednesday. This movement coincides with significant declines in China's stock markets, where the Shanghai Composite and Shenzhen CSI 300 experienced their largest daily losses since 2020, driven by profit-taking and a lack of new stimulus measures. The Hang Seng index in Hong Kong also fell. Among the ETF's holdings, notable contributors to the negative performance include TCEHY, PDD, XIACY, JD, and TCOM, all of which reported declines. Additionally, the AUD/USD currency pair has moved down slightly, reflecting broader market sentiment that may also influence emerging markets.

iShares China Large-Cap ETF (FXI) [-2.9%]
The iShares China Large-Cap ETF (FXI) is reflecting a bearish sentiment, with its premarket performance showing a drop of 2.9%. This decline coincides with significant losses in major Chinese stock indexes, including the Shanghai Composite and Shenzhen CSI 300, which fell sharply, marking their largest daily losses since 2020. Investor disappointment over the lack of new economic stimulus measures from Chinese authorities has contributed to this downturn. Additionally, notable stocks within FXI, such as NetEase and Alibaba, have also faced substantial declines. Social media discussions highlight that FXI's current performance marks the end of a 10-day winning streak, as investors await upcoming fiscal policies from Beijing. Meanwhile, the Hang Seng Index has experienced a drop following previous losses, further emphasizing the prevailing negative sentiment surrounding China's economic recovery.

BABA | -3.2% | -65.4B
Alibaba Group Holding Ltd | Broadline Retail
Alibaba Group Holding Ltd (BABA) has seen a notable decline, reflecting a broader downturn in Chinese equities. Social media discussions highlight that this marks BABA's largest decline of the year, coinciding with the CSI 300 index plunging significantly. The iShares China Large-Cap ETF (FXI) has also declined, mirroring the overall sell-off in Chinese stocks, which are experiencing their largest daily losses since 2020. This downturn follows disappointment over the absence of new government stimulus measures. Furthermore, China's Finance Minister, Lan Fo'an, is scheduled to hold a briefing on fiscal policy adjustments and economic development on October 12, which may influence market sentiment towards BABA and other major Chinese stocks.

BA | -1.7% | -1.6B
Boeing Co| Aerospace & Defense
Boeing Co. has withdrawn its contract offer to the striking machinist union after three unsuccessful negotiation attempts, marking a significant escalation in the ongoing strike, which has now lasted four weeks and involved approximately 33,000 workers. The strike has severely disrupted operations, prompting S&P Global Ratings to place Boeing on negative watch, with expectations of cash outflows of around $10 billion in 2024 due to strike-related costs and production delays. The company faces over $1 billion in monthly costs associated with the strike, despite implementing cost-saving measures. Additionally, safety concerns have arisen, as the FAA issued alerts regarding potential rudder system jams on Boeing 737 airplanes. Boeing is exploring options to raise cash, including stock sales and hybrid securities, amid approximately $60 billion in debt and significant operating cash flow losses exceeding $7 billion in the first half of 2024.

BYDDY |-3.4%|-2.9B
BYD Co Ltd | Automobile Manufacturers
BYD Co Ltd is aiming for 100,000 electric vehicle sales in Mexico by 2025, with a target of 50,000 units for this year. This ambitious plan is accompanied by the intention to establish a factory, expected to be announced by year-end. However, the company faces potential challenges from former President Donald Trump's proposed 200% tariffs on Chinese-made cars if he wins the 2024 Presidential election. Earlier this year, BYD delayed significant investments in Mexico while awaiting U.S. election outcomes. Concurrently, the Xtrackers Harvest CSI 300 China A-Shares ETF has declined significantly, reflecting broader losses in Chinese markets, including notable drops in the Shanghai Composite and Shenzhen CSI 300. This downturn may provide context for BYD's own decline of 3.4%.

GOOG | -0.9% | -7.9B
Alphabet Inc | Interactive Media & Services
Alphabet Inc has experienced a decline of 0.9%, driven primarily by significant downward movement in the Interactive Media & Services sub-sector. This sector-wide trend aligns with a slight drop in the Nasdaq 100 Index, which has remained largely stable. Compounding this situation, the U.S. Department of Justice is contemplating substantial measures against Google, a subsidiary of Alphabet Inc, following a recent antitrust ruling. Proposed actions include potential structural changes and behavioral remedies aimed at curbing Google's dominance in the search market, where it holds a 90% share. The DOJ's recommendations have sparked considerable discussion on social media, with users drawing parallels to historical antitrust cases, such as the breakup of AT&T. This heightened scrutiny coincides with Alphabet's stock price movement, which has seen fluctuations amid these developments.

FUTU | -5.6%| -6.5B
Futu Holdings Ltd | Investment Banking & Brokerage
Futu Holdings Ltd (FUTU) has experienced a decline of 5.6%, coinciding with a significant drop in the Xtrackers Harvest CSI 300 China A-Shares ETF (ASHR), which fell notably. This downturn is linked to substantial losses in the Chinese markets, where the Shanghai Composite and Shenzhen CSI 300 recorded their largest daily declines since 2020. The declines stem from investor disappointment regarding the absence of new stimulus measures, particularly affecting property and tourism stocks. Conversations on social media highlighted FUTU's relative performance amidst this volatility, noting its range during recent market fluctuations. Users referenced specific trading systems such as "Ripster Clouds" and "Voice Guidance," indicating a focus on managing risk in light of the broader market conditions impacting Chinese equities.

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