59 Comments 2024-06-30

Global Stocks Plunge; Chinese Shares, Oil Prices Defy Trend

Recently, it's been quite a bustling scene! The stock markets in Europe and America have plummeted like autumn leaves, falling so heavily it's heart-wrenching. Meanwhile, Chinese concept stocks have surprisingly risen against the trend, astonishing enough to make one's jaw drop. Not only that, but international oil prices have also been soaring, as if they were about to take flight. What's behind all of this? Today, let me share with you the stories behind these scenes and provide an in-depth analysis of how the financial market "jianghu" operates!

We must talk about the "roller coaster" market of European and American stocks in this round. The tickets you just bought have fallen in value like stones within a few days. This market condition has left many people anxious and unsure of how to respond. In fact, there are quite a few reasons behind this.

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People are closely watching the Federal Reserve's policies, like ants on a hot pan. The Fed continues to raise interest rates, on one hand, trying to curb inflation, and on the other hand, it has to consider economic growth, truly a difficult balancing act. Looking at the Consumer Price Index (CPI) from September, the increase has reached 24%, exceeding the worst expectations of many. It seems that inflation is still entangled with the economy. Here's a reminder: inflation is like waking up in the morning to find that the price of vegetables has risen again, which doesn't feel good at all.

Once the inflation data is out, the stock market is naturally affected. Think about it, everyone has money in hand, and no one wants to throw their money into the ocean under uncertain circumstances. Therefore, market sentiment becomes particularly fragile, and stock market fluctuations become a natural phenomenon.

Let's talk about the heartbreaking number of unemployment benefit applications, which has reached the highest point in over a year. Frankly, seeing this news always makes me a bit nervous. Although on the surface, there are still many companies recruiting, this unemployment benefit data is like a signal, warning us: "Be careful! There might be a thunderbolt coming from the sky!" People are becoming more and more pessimistic about the economic outlook, and naturally, they are unwilling to put their money into the stock market. This is a chain reaction; everyone fears risk, and the stock market, of course, has to fall.

So, what changes have occurred on the side of Chinese concept stocks? This is truly exciting. Do you remember what the situation was like with Chinese concept stocks in the past? They were under so much pressure that they could hardly breathe, and now there are signs of recovery. Why is that?

The Chinese government has recently introduced strong support policies, which can be seen as extending an olive branch to Chinese concept stocks, striving to attract more investors. It's imaginable that the strength of these policies is not small, such as lowering the listing threshold and increasing financing convenience, which is a "timely rain" for Chinese concept stocks.

Let's talk about the expectations for economic recovery. With the gradual recovery of China, especially the manufacturing industry, investors are becoming more optimistic about future profit expectations. For example, big players like Alibaba and Tencent have started to see a strong market rebound, which has also made the overall atmosphere of Chinese concept stocks more active, just like a player who has been injected with chicken blood, naturally full of fighting spirit.

Speaking of this, we have to mention the market's risk-aversion sentiment. It's really strange. When the European and American stock markets are unstable, people start to think: "Hey, should I move my money to a safer place?" As part of the emerging market, Chinese concept stocks have naturally become a "safe haven" in the eyes of many investors.

Now, the surge in oil prices is simply astonishing. Oil prices have recently boarded a "spaceship," continuously rising. Under these circumstances, global energy demand is gradually increasing, and OPEC+ has announced a reduction in production, which is like a strong stimulant for oil prices. The supply and demand relationship is like a double-edged sword; if not balanced well, it will cause drastic price fluctuations. The tense situation formed between potential demand and production reduction measures has indeed given oil prices the space to rise like a tiger out of the cage.Geopolitical risks are also influencing the price of crude oil. This situation is akin to being in the sweet phase of a romantic relationship while simultaneously being on edge, fearing the unexpected. The Middle East, often referred to as a "powder keg," is experiencing tense situations that further destabilize global market sentiment. When oil prices rise, many people immediately become anxious and eagerly anticipate the next developments. This uncertainty not only causes fear but also significantly benefits funds invested in crude oil.

Subsequently, the weakness of the US dollar is absolutely one of the significant factors driving up oil prices. The US dollar is always sought after by investors for its "safety." Recently, the weakening of the US dollar index has made crude oil priced in dollars more competitive, as if everyone now feels it's "cheap," leading them to rush in and buy, thus driving up oil prices. This is indeed a rare "good thing."

Where will the market head next? Our tea has not yet cooled, and market changes are always unpredictable. Analysts on Wall Street are also racking their brains. The Federal Reserve's monetary policy can be considered the market's "weathervane." How will their next moves affect investors' psychology? It's conceivable that the Federal Reserve's next decision will be an