1. U.S. stocks closed mixed overnight, with the Dow and S&P 500 falling after hitting new highs, while the Nasdaq edged higher. All three major U.S. stock indexes posted gains in September. Goldman Sachs' Chief U.S. Equity Strategist, David Kostin, stated that the path for U.S. stocks to continue higher is clear once the U.S. presidential election results are determined. They predict that the S&P 500 will trade near 6,000 points in a year. This forecast implies that the S&P 500 will rise by about 5% from Tuesday's closing level, having already gained about 20% this year. However, Kostin also noted that as the U.S. presidential election enters its final stage, investors may have to experience some market volatility in the coming weeks. He said that historically, this is a period of rising volatility and falling stock prices. Despite the Federal Reserve's significant rate cut last week boosting market sentiment, concerns about economic slowdown still persist. According to the FedWatch tool, the market's expectation for the Federal Reserve to cut rates by another 50 basis points at the November meeting rose from 53% a day earlier to over 60%.
DBS Bank's Deng Zhijian: The Federal Reserve's long-term interest rate anchor is set at 3%, clearly indicating that the economy has not entered a recession. Therefore, there is no need for medium to long-term investors to exit the market in the short term, as the stock market still has support. If the Federal Reserve cuts rates by another 50 basis points this year and 100 basis points next year, many investors believe this is a positive factor. However, I do not think so. The reason is that the Federal Reserve is still reducing its balance sheet, and future funds will inevitably remain tight, so the short-term surge in U.S. stocks may just be a false hope. Rationality suggests that not all stocks can rise in a "soft landing" scenario, and it might be better to invest in high-yield assets and defensive sectors.
2. Gold prices continue to soar, and the U.S. dollar recorded its largest increase since June 7th.
On Wednesday, spot gold once surged past $2,670 to a record high, then gave up the gains and closed nearly flat at $2,656.81 per ounce. COMEX gold futures rose by 0.16%, closing at $2,681.3 per ounce. The U.S. dollar index rose by 0.57%, reporting 100.925 points, with intraday trading ranging from 100.161 to 100.993. From a daily perspective, the U.S. dollar index has been fluctuating narrowly around 101 points since August 21st, and it once fell to 100.215 points on September 18th.
DBS Bank's Deng Zhijian: Gold has recently hit new highs repeatedly, and the U.S. dollar index has not shown a significant decline. Why hasn't the "seesaw" effect occurred? The U.S. dollar index did not plummet due to rate cuts mainly for two reasons. First, the long-term anchor interest rate is not low, which discourages investors from heavily betting against the U.S. dollar. Second, the main weight in the U.S. dollar index is the euro. The probability of a recession in the eurozone may be higher than in the United States, and it also needs to cut rates, making it difficult for the euro to rise against the U.S. dollar. Therefore, the U.S. dollar index did not decline significantly due to the euro's weakness. Of course, even if the U.S. dollar index does not fall, it does not mean that gold prices will not rise. The demand for gold remains moderately increasing, especially with the recent increase in investment demand, which contributes the most to the rise in gold prices.
1. Gold prices are expected to continue rising, and the domestic gold sector is worth paying attention to recently.
3. Meta releases major new products: cheaper mixed reality headsets, holographic AR glasses, AI assistants that can speak.
On Wednesday, Meta showcased its AI and VR capabilities at the Connect annual developer conference, launching the new, cheaper mixed reality headset device Quest 3S and the prototype of the first Orion holographic AR smart glasses. Meta also released the latest multimodal LLAMA 3.2 artificial intelligence model, which can understand both images and text simultaneously. CEO Zuckerberg said that Meta is committed to "bringing the future to everyone" through headsets, glasses, and artificial intelligence systems. Some analysts say that Meta is trying to demonstrate its AI strength and the next-generation computing platform that surpasses smartphones and computers. The above news pushed Meta's stock price to reach a daily high after noon, rising by 2.4% at one point, although the increase was halved by the time of closing, but the closing price of $568.31 still set a historical record. Meta emphasized the multitasking processing and application running capabilities of the Quest 3S mixed reality headset, positioning it as a "multitasking computer" rather than just a gaming and entertainment device. The Orion glasses are called "the first true augmented reality glasses" and "the most advanced AR glasses to date", using a wristband component to receive users' neural signals, allowing them to control Orion with their brains. This technology originates from the company's acquisition of CTRL-Labs in 2019. However, the product is not currently available for sale to consumers but provides access to internal employees and specific external audiences, striving to continuously learn, iterate, and build an AR glasses product line suitable for consumers at some point in the future. Meta also released a new Meta AI feature for smart glasses in collaboration with Ray-Ban. In addition to hardware devices, Meta also released the latest version of the large model Llama 3.2, the Meta AI chatbot "can speak", and also provides a voice library authorized by Hollywood stars.
DBS Bank's Deng Zhijian: AI visual devices are bound to be an important development trend, and the information reception and output between AI and humans require powerful AI visual technology. Because in the future, AI needs to output content in various forms, the current text and sound are being perfected, and the output of images is one of the current development directions for AR glasses. However, I believe this is just a transitional product. The current competitive technologies are mainly focused on AI efficiency and imaging effects. Meta has a technological advantage but still needs to strengthen cooperation with other technology companies. Because future AI devices will inevitably be able to use offline, requiring extremely high computational and storage capabilities for the devices. Therefore, if investors use information for short-term speculation, they should pay attention to risks. However, Meta's technological and customer base advantages can continue to bring more development to the business, and it is okay for investors to make medium to long-term layouts.Commentator Xu Ge: There are currently two major trends in the news and products of AR glasses: First, the evolution from bulky headsets to lightweight glasses. It is said that the new type of AR glasses that Meta is about to launch are similar to ordinary glasses. Second, there is a further integration with artificial intelligence. The AR-related patents that Meta is applying for also combine the functions of machine learning and AI Agents. However, judging from the AR headset launched by Apple last year, this road seems not to be smooth. More powerful functions and lighter devices are inherently contradictory. The outside world is paying attention to Meta's first pair of glasses, hoping to see breakthrough progress in this field, bringing investment opportunities in the upstream and downstream of this industry.
2. The application of AI is accelerating, and the direction of AI computing power can be continuously focused on.
④ChatGPT Advanced Voice Mode officially launched, supporting more than 50 languages
OpenAI officially announced yesterday that the advanced voice mode of ChatGPT will be officially launched for ChatGPT Plus individual users and small business team (Teams) users this week. This function will first be launched in the U.S. market and will be open to OpenAI enterprise and education users next week. However, it is worth noting that the new voice function is suitable for OpenAI's GPT-4o model and is not suitable for the recently released preview model o1. This means that from this week, ChatGPT Plus individual users and small business team users can interact with the chatbot through "voice" instead of traditional text input. The two highlights of the advanced voice mode are particularly eye-catching: one is that users can set "custom commands" for voice assistants to achieve personalized operations; the other is the "memory" function, which can remember the user's preferred interaction method. To meet the preferences of different users, the advanced voice mode has added five distinctive voices: Arbor, Maple, Sol, Spruce, and Vale, along with the original four voices Breeze, Juniper, Cove, and Ember, forming a total of nine voice options. ChatGPT's advanced voice mode now supports more than 50 languages, expanding the communication range of users.
Commentator Xu Ge: The significance of the new version of ChatGPT lies in the fact that it can interact with the chatbot through "voice" instead of text, which is of great significance at two levels. First, it reduces the time and effort of input and becomes more universally communicative; second, the applicable population is more extensive, which is of great significance for some people who cannot type, laying the foundation for future universal intelligent robots. At the same time, it also brings challenges to ChatGPT, that is, the accuracy of understanding human natural language is a difficulty. The launch of this product indicates that key issues have been resolved at this level. In terms of investment, companies upstream and downstream of intelligent robots can be focused on.
Guojin Securities Wealth Center Strategy Analyst Huang Cendong: 3.
⑤Buffett wants to clear out Bank of America? Another $860 million in cash, the holding ratio is close to the regulatory threshold
Since mid-July, Buffett has been selling Bank of America's shares on a large scale, seemingly clearing out. In the latest sale, Berkshire Hathaway, under Buffett, further sold $863 million of Bank of America's shares, bringing the company's holding ratio close to the regulatory threshold of 10%. According to Tuesday's closing price, Berkshire Hathaway's remaining shares in Bank of America are still worth $32.1 billion, firmly holding the position of the largest shareholder. In the consecutive sales, Buffett has cashed out more than $7.5 billion, making Berkshire Hathaway's cash reserves more abundant.
DBS Bank Deng Zhijian: Buffett is unlikely to clear out Bank of America. Although Bank of America, like the other three major banks, has seen a double shrinkage in revenue and profits in the past two years, the dividend payout ratio is second at 38%, and the dividend yield is second at 2.5%. Buffett is unlikely to have a higher dividend yield on Apple. If Buffett maintains his style, the possibility of clearing out Bank of America is not great. However, business instability, interest rate cuts may reduce interest income, and even the possibility of increasing non-performing loan ratios, short-term reduction is normal behavior.
4. Domestic banks still face pressure on net interest margins in the future, but stock performance is not weak. The high dividend style is likely to continue.Caterpillar, the construction machinery giant, saw its stock price reach a new high on Tuesday, with a year-to-date increase of over 29.5%. Although the stock closed nearly 2% lower overnight, it rose by nearly 4% on Tuesday, setting a historical record. The stock has accumulated a gain of more than 29.5% this year. It is worth mentioning that the market often regards Caterpillar as a barometer of the global economy because the equipment it produces is used in resource extraction and construction activities, which are the driving forces of economic growth, especially in emerging markets.
Deng Zhijian from DBS Bank: Caterpillar is considered an economic barometer mainly because it is a direct supplier of infrastructure and mining equipment and solutions. The performance of the economy directly affects the performance of its business. The company is developing energy-saving and emission-reducing equipment, including new types of mining trucks. Last year, its revenue exceeded $60.7 billion, a year-on-year increase of 13%; profits exceeded $10 billion, a year-on-year increase of 54%. However, profits and revenue declined in the last quarter, and it is expected that profits may continue to decline in the new quarter. Moreover, the US economy is basically in a "soft landing," requiring interest rate cuts to stimulate the economy. Historically, when the US economy is in a downturn or even a recession, it takes an average of 6 quarters to recover. Half of Caterpillar's business comes from the US, and the recent stock price increase cannot be related to a good economy. However, the stock price has continued to rise for three months, mainly driven by the company's announcement in June of a $20 billion repurchase.
Huang Cendong, a strategy analyst at Guojin Securities Wealth Center: It is worth paying attention to domestic leading main machine factories with smooth global promotion and diversified product layout.
Fangzheng Securities Machinery Equipment Industry Event Review Report: The inflection point of domestic excavators is clear, and foreign sales continue to grow at a high speed. Currently, the growth rate of domestic small, large, and medium excavators has successively turned positive, and the inflection point of excavators is clear. The stable and healthy development of real estate will also drive the growth rate of concrete machinery, cranes, and other post-cycle products to gradually turn positive. In terms of foreign sales, there is strong demand in Southeast Asia, Africa, Latin America, and Oceania. Europe and the United States are expected to usher in a restocking cycle and marginal improvement in demand as the interest rate cut cycle begins. At present, the export of main products such as excavators, cranes, and forklifts still maintains a high-speed growth.