To The Moon

Tuesday (24 Sep) still see not a lot of buying conviction and there is also no real selling conviction either. But we do saw some buy-the-dip interest which happened on Nvidia (NVDA) which was up 4% and same interest was seen on the mega-cap stocks as well.

People's Bank of China Policy Measures

7-day reverse repurchase rate lowered by 20 basis points to 1.50%. Required reserve ratio cut by 50 basis points. Down payment requirement for second-home buyers reduced to 15% from 25%. CNY800 bln ($113 bln) liquidity support facility for stocks.

We saw China's Shanghai Composite surged 4.2% after the announcement, this has also helped Chinese ADRs to significant gains.

Li Auto (LI) was up +11.4% and Alibaba (BABA) also managed +7.9%, and the iShares China Large-Cap ETF was up +9.8%.

This wave of policy stimulus measures announced in China was widely welcomed by the market which help the S&P 500 Materials sector which closed +1.35% higher, Industrials sector aso saw +0.70% gain.

Current Labor Market Situation Continued To Soften

The consumers' views of the current labor market situation continued to soften, becoming more pessimistic about future labor market conditions. This sentiment could weigh on consumer spending activity.

This sentiment is after we saw July FHFA Housing Price Index came in at 0.1% where previous stands at 0.0%. July S&P Case-Shiller Home Price Index came in at 5.9% which consensus was 6.0% and previous was 6.5%.

The Conference Board's Consumer Confidence Index fell to 98.7 in September from 105.6 in August with consensus at 102.9.

Gold prices hit new milestones last week, reaching a fresh record high of $2,600 on Friday. Expectations of further interest rate cuts bolstered the appeal of bullion, but that is not the only reason. It continued to stay above $2,600 and was at $2,660.75 at time of this writing.

The rising deficit rate in the U.S. is one of the key forces driving gold prices. Historically, Gold prices and the US deficit rate have shown good synchronicity historically

Nvidia Help Information Sector Up

The Philadelphia Semiconductor Index was up +1.3% with the strength from Nvidia (NVDA) providing the biggest contribution. Nvidia (NVDA) also help the information technology sector to be up +0.79%.

Financial sector was brought down by the weakness in bank stocks, we saw financials losing -0.92% with the SPDR S&P Bank ETF (KBE) and SPDR S&P Regional Banking ETF (KRE) declined 1.3% and 1.4%, respectively.

NVIDIA found support after briefly trading below its 50-day moving average (115.93) this morning. Barron's reported that CEO Jensen Huang completed a preplanned stock sale several months ahead of schedule, which investors presumably viewed positively.

Note Yield Mixed After Weak Consumer Confidence Report

Treasury Note yield saw mixed reaction after a weaker-than-expected Consumer Confidence Report for September. The 2-year note yield settled at 3.524%, down twenty-four basis points from yesterday's settlement. The 10-year note yield have a twelve basis points to close at 3.745%.

The Treasury market also digested a $69 billion 2-yr note auction that saw the high yield match the when-issued yield of 3.52%.

Stocks To Watch

The U.S. Department of Justice has filed a civil antitrust lawsuit against Visa (V) on Tuesday, accusing the payments network giant of maintaining an illegal monopoly in the debit card market. The lawsuit claims Visa penalizes merchants and banks that choose alternative payment processing technologies, leading to higher fees for consumers and businesses. Shares of Visa fell 5.4% following the news.

$NVIDIA Corp(NVDA)$ shares rose 4% as the company prepares to begin shipping its highly anticipated Blackwell GPU in the fourth quarter. Nvidia's CEO Jensen Huang confirmed the ramp-up of Blackwell production during the Goldman Sachs Communacopia + Technology Conference, highlighting significant demand and a potential revenue opportunity exceeding $10 billion for 2024.

With Nvidia now trading Vwap and the multi-timeframe showing NVDA have trade above short-term and long-term MA, we are seeing a setup for higher upside from Nvidia especially with the Blackwell production worries cleared.

China's central bank announced a fresh round of economic stimulus measures, including cutting a key short-term interest rate and reducing the reserve requirement ratio for banks. This move led to gains in Chinese stocks, ETFs, oil, and commodities, and positively impacted U.S.-listed companies with China ties. Notable movers included $JD.com(JD)$ , $PDD Holdings Inc(PDD)$ , and Li Auto (LI), all surging over 10%.

Though we are seeing both JD.com and PDD Holdings risen more than 10% after the announcement of China economic stimulus measures, but we can see that JD.com have better potential for continual upside based on the MA and the MTF.

JD.com is trading above both the short-term and long-term MA and the MTD is showing signal of uptrend.

whereas if we looked at PDD, the long-term MA is above the short-term MA, which signal a bearish reversal and it is currently trading below both.

MTF is also showing signal of downtrend, and we might want to exercise caution when looking at PDD.

Microsoft (MSFT) plans to invest $1.3 billion in Mexico over the next three years to enhance AI and cloud infrastructure and promote digital skills. The investment aims to improve connectivity and AI technology for small- and medium-sized businesses and train up to 5 million residents.

Summary

I believe we could still be seeing little or unchanged conviction as investors are looking to continue the buy-the-dip, there might be more activities on the semiconductor with Nvidia rising from its slump and Blackwell production on track would be positive to investors.

I would be monitoring how the market would be trading while looking to buy-the-dip. I have managed to secure $ARM Holdings Ltd(ARM)$ last night.

Appreciate if you could share your thoughts in the comment section whether you think market will continue to exhibit low or unchanged conviction today (25 Sep).

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.