Retail investors are pessimistic about whether U.S. stocks can rebound after falling in April as inflation remains stubborn and economic growth stagnates.

After more than five months of strong optimism, the closely watched bull-bear spread in the American Association of Individual Investors' (AAII) weekly survey turned negative for the first time since early November, as stocks were rebounding from their October lows. A reading of -1.8 on the index means that only slightly more investors are pessimistic about stocks over the next six months than are optimistic. However, the pace of decline in bullish sentiment has accelerated in recent weeks.

On Friday, a few minutes after Bank of Japan Governor Kazuo Ueda finished his speech, the USD/JPY exchange rate fell nearly 200 points in the short term and fell below the 155 mark at one point, but then quickly rebounded and returned above the 156 level.

Earlier, the dollar rose to its highest level against the yen in three decades, making the market nervous about possible intervention, especially if the US PCE price index is higher than expected tonight, which would push up the dollar and increase downward pressure on the yen.

Analyst Adrian Kennedy pointed out that the sharp short-term fluctuations in the US dollar and the Japanese yen were rapid and sudden fluctuations that occurred a few minutes after Ueda Kazuo stopped speaking. This is a reminder that the market has been on edge about possible intervention by the Japanese authorities.

A look at next week's important futures data and events

1. At 24:00 on April 29, a new round of price adjustment will be opened for domestic refined oil products. Zhuochuang Information believes that although the "May Day" holiday is approaching, the demand for refined oil products, especially gasoline, will usher in a peak season again, but the industry lacks confidence in the future market and may purchase more according to demand. It is difficult for large orders to increase in the market, and there is still a lack of momentum for gasoline and diesel prices to rise before the holiday.

2. At 09:30 on April 30, China's official manufacturing PMI, non-manufacturing PMI, steel industry PMI, and comprehensive PMI for April. Previously, China's official manufacturing PMI for March was 50.8, returning to the expansion range, and the economic recovery momentum has further strengthened. Pay attention to whether the April PMI can maintain its expansionary momentum.

Perhaps a worse outcome for the U.S. economy than a recession is the possibility of a return to an era of stagflation, and this is exactly the scary picture presented by the latest U.S. gross domestic product (GDP) and inflation data.

According to the U.S. Bureau of Economic Analysis, U.S. economic growth in the first quarter was far below expectations, with an annualized growth rate of only 1.6%, which was not only far below the forecast of 2.5%, but also a significant slowdown from the 3.4% growth in the fourth quarter of last year.

“This report was terrible on two counts — lower-than-expected economic growth and higher-than-expected inflation,” wrote David Donabedian, chief investment officer of U.S. private wealth at CIBC.

According to the Wall Street Journal, allies of Republican presidential candidate Trump are quietly drafting proposals to try to weaken the independence of the Federal Reserve if Trump wins a second term. Nick Timiraos, a well-known financial reporter known as the "New Fed News Agency", also participated in the report.

What is Trump's team "plotting"?

In recent months, former Trump administration officials and other Trump supporters have discussed a range of proposals, from incremental policy changes to the unlikely proposition that the president himself should be involved in setting interest rates. A small group of Trump allies has drafted a roughly 10-page document outlining their vision for the Fed, according to people familiar with the matter. Their work was so secret that even some of Trump's former high-profile economic aides were kept in the dark.

The United States will release March PCE data at 20:30 Beijing time on Friday. Analysts expect the data to be mixed, which may further strengthen the Fed's determination to stay on hold.

According to FactSet, analysts expect the year-on-year PCE growth rate in the United States to rise slightly to 2.6% in March from 2.5% in February. However, they also predict that the month-on-month PCE growth rate will decline from 0.33% to 0.30% in March.

Economists predict that after excluding the volatile food and energy costs, the core PCE in the United States in March increased by 2.7% year-on-year, a slight decrease from the previous value of 2.8%. However, economists expect the core PCE data to increase from 0.26% to 0.30% month-on-month.

Kitco, a precious metals website, said that the gold market's recent record high above $2,400 an ounce may represent a peak. However, investors should not expect to see much downside from current levels, as the World Bank believes that gold will rise by 8% this year.

The World Bank said in its Commodity Markets Outlook 2024 that it sees gold prices averaging around $2,100 an ounce. Gold prices rose 4% in the first quarter of this year and have been rising sharply since then. The international financial institution also said that it does not rule out the possibility that gold prices will rise even higher this year.

ICE raw sugar shows a relatively obvious bearish trend

Economies.com's analysts' latest view today: ICE raw sugar prices have resumed their negative trading, moving away from the 19.82 level. This strengthens expectations for the continuation of the bearish trend on an intraday and short-term basis. It awaits a test of 18.50, which represents the first target, with the possibility of a further decline to 17.35. The expected trading range is between the support level of 19.60 and the resistance level of 19.40. Trend forecast: Bearish.

Continuation of the CBOT soybean uptrend requires prices to remain above the 1170.00 and 1155.00 levels

Economies.com's analysts' latest view today: CBOT soybean prices have recovered after the previous decline, maintaining a consolidation trend above EMA50. It is waiting for more intraday gains, with the main target at 1193.10. The current bearishness of the stochastic indicator may hinder the upward mission of the price, resulting in some temporary sideways fluctuations. The continuation of the bullish wave requires staying above the 1170.00 and 1155.00 levels. The expected trading range is between the support level of 1165.00 and the resistance level of 1193.00. Trend prediction: bullish.

U.S. demand showed resilience, even though the GDP data released on Thursday did not reflect this directly. Goldman Sachs stressed that the U.S. GDP data was not as weak as it appeared.

The U.S. GDP slowed significantly in the first quarter, but this masked the originally solid household demand and business investment activities, and it was these factors that together contributed to the accelerated upward trend in U.S. inflation.

The annualized growth rate of US GDP in the first quarter was 1.6%, lower than the consensus forecast of economists, with the main drag being the reduction of inventory accumulation and the widening of the trade deficit. However, after deducting inventory, trade and government spending, final sales to the domestic private sector grew by 3.1% after adjusting for inflation. This key indicator of core demand has been above 3% for three consecutive quarters.

Microsoft Corp (MSFT.O) on Thursday reported third-quarter revenue and profit that beat Wall Street expectations, driven by gains from its use of artificial intelligence in its cloud services.

Specifically, in the quarter ending in March, Microsoft's revenue grew 17% to $61.9 billion, exceeding the general expectation of $60.8 billion; earnings per share were $2.94, exceeding Wall Street's expectation of $2.82. The Intelligent Cloud Division, which owns the Azure cloud computing platform, saw revenue rise to $26.7 billion, with a forecast of $28.4-28.7 billion in the fourth quarter; Azure revenue grew 31%, with a forecast of 30%-31% growth in the fourth fiscal quarter; and personal computing division revenue grew 17% to $15.6 billion.

The World Bank pointed out that although global commodity prices have declined, they are still stable at a relatively high level, which may hinder the pace of interest rate cuts by central banks.

According to a report released by the World Bank on Thursday, commodity prices have remained basically stable after a nearly 40% plunge from mid-2022 to mid-2023. The report predicts that unless the intensification of the conflict in the Middle East leads to further increases in costs, global commodity prices are expected to fall by 3% in 2024 and continue to decline by 4% in 2025. Despite this, commodity prices are still too high, and the report predicts that inflation will remain above the targets of most central banks and will be about 38% higher than the average of the five years before the COVID-19 pandemic.

Alphabet released its latest earnings report after the U.S. stock market closed on Thursday. Previously, the company faced concerns about the growth of its core Google advertising business and its ability to profit from its huge investments in artificial intelligence. Fortunately, the impressive performance of the earnings report dispelled Wall Street's concerns.

Alphabet beat analysts' earnings expectations, with revenue growing 15% in the quarter, the fastest pace of expansion since the beginning of 2022. YouTube ad sales grew 20%, also beating expectations. The first-quarter results also showed that the core advertising business is reaccelerating growth after a difficult 2022 and 2023, when brands cut spending in response to rising interest rates and inflation concerns.

Mini Program: Daily Cryptocurrency Dynamics Summary

1. Bitcoin mining difficulty increased by 1.99% to 88.1 T last night, a record high

According to BTC.com data, the difficulty of Bitcoin mining has been adjusted at block height 840,672 (2024-04-24 22:51:52), with the mining difficulty increased by 1.99% to 88.1 T, a record high. The current average computing power of the entire network is 642.78 EH/s.

2. The first rare satoshi minted from Bitcoin’s fourth halving block sold at auction for $2.13 million

As Cointelegraph reported, the first rare satoshi “epic sat” minted from Bitcoin’s fourth halving block was sold for $2.13 million (33.3 BTC) at an auction hosted by CoinEx global.

That’s the question everyone is asking: When will the Bank of Japan finally intervene and stem the yen’s collapse… or, if the Bank of Japan refuses to intervene, whether Tokyo really wants to provoke hyperinflation in a desperate attempt to inflate away the country’s massive debt burden at the cost of social unrest and a sharp drop in population.

One thing is certain: while the Japanese Ministry of Finance may pretend that nothing is happening, sooner or later they will react, especially if the current pace of the yen's collapse continues.

In a few hours, the market will usher in the Bank of Japan meeting, which is widely expected to not change policy. The main focus will be on the quarterly outlook report and the communication of Governor Kazuo Ueda on future purchases of Japanese government bonds and interest rate hikes.

The Bank of Japan may still raise interest rates three more times this year after a historic hike last month, which could be more than market expectations, Pacific Investment Management Co. (Pimco) said.

“From our perspective, this is really the beginning stages of a monetary policy adjustment in Japan,” said Sachin Gupta, a portfolio manager at Pimco who oversees more than $40 billion in assets. He noted that while some market participants expect another 50 basis points of rate hikes this year, Gupta believes “it could be a bit bigger, perhaps as much as 75 basis points.”

U.S. Treasury Secretary Janet Yellen, asked about her reaction to any potential moves by Japan to counter the yen's depreciation, said intervention in foreign exchange markets should be rare.

Yellen said in an interview live on Reuters on Thursday that "market exchange rate adjustments are part of the different policies that countries can pursue" as reflected in the thinking of the Group of Seven (G7). She said that for "large countries with market-determined exchange rates", intervention should only be done in rare cases.

"We would hope that this would happen rarely, and we would expect this intervention to occur only rarely and only in cases of excessive volatility, and they would be consulted in advance," Yellen said.

Nick Timiraos, a well-known financial journalist known as the "New Fed News Agency", wrote that US inflation has been stronger than expected for the third time, and the dream of interest rate cuts is fading away. The following is the content of the article.

Thursday's economic activity report was the latest wake-up call for investors and Federal Reserve policymakers, who have been holding their breath in hopes that falling inflation would allow rate cuts to begin in earnest this summer. However, data from the U.S. Commerce Department showed that inflation was more stubborn than expected for the third month in a row after cooling perfectly in the second half of last year. So far this year, individual economic growth and price data have not been enough on their own to significantly change the Fed's outlook, but the cumulative impact of these consecutive disappointing data is significant.

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Macro News

1. The spokesperson of the Ministry of Commerce said that recently, some Western countries have repeatedly accused China of overcapacity. This kind of speculation is groundless and China firmly opposes it. The capacity issue should be discussed in the context of economic globalization, taking into full consideration the realities of the global division of labor and the international market, and should be handled with an objective, fair and scientific stance.

2. After research and decision by Zhengzhou Commodity Exchange, from the settlement on April 29, 2024, the trading margin standard for sugar, cotton, rapeseed meal, rapeseed oil, cotton yarn, peanuts, PTA, methanol, urea, staple fiber, paraxylene and caustic soda futures contracts will be 9%, and the price limit will be 8%.

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Today's Picks

U.S. GDP annualized rate in the first quarter was significantly lower than expected

Goolsbee: Fed must 'recalibrate' policy

Japanese media: Bank of Japan will consider taking measures to reduce its government bond purchases

Israeli PM approves ground operation in Rafah

Houthis seek to expand operations in Indian Ocean

US Secretary of State Blinken arrives in Beijing

SHFE: Guarding against systemic risks caused by large price fluctuations

Russia will consider downgrading its diplomatic relations with the United States if Western governments continue to propose seizing Russia's frozen assets, Deputy Foreign Minister Sergei Ryabkov said on Thursday, RIA Novosti reported.

The G7 is seeking to use nearly $300 billion worth of Russian financial assets frozen by sanctions since 2022 to help support Ukraine as the conflict enters its third year.

Earlier, US President Biden signed a foreign aid bill, which included more than $60 billion in aid to Ukraine and about $26 billion in aid to Israel.