Market analysis on June 20

This Friday will usher in a major event called the “Four Witch Days” by the market. That is, the four types of financial contracts related to stocks and options expire on the same day. The nominal value involved is expected to exceed 5 trillion US dollars, which is probably the largest in history. This situation usually results in increased market volatility as traders adjust or close their positions before the options expire.

Against this backdrop, US stocks showed volatility. Although the S&P 500 index and the Nasdaq Composite Index hit new intraday highs in early trading, they then turned down. The NASDAQ ended seven consecutive gains, while the Dow Jones Industrial Average continued to rise three times in a row, reaching a four-week high. Nvidia, in particular, despite a significant increase at the beginning of the session, hit a new intraday high, then fell sharply and fell 3.5% at the close.

Meanwhile, the Bank of England's latest decision has caused the price of British bonds to soar, driving short-term British bond yields to a new low of nearly three months, and the value of the pound against the US dollar has dropped sharply. Furthermore, the release of US unemployment data has led to a recovery in US bond yields.

In the commodity market, oil prices and metal prices have generally risen. Prices of Brent crude oil and US crude oil have reached new highs of more than seven weeks, and the prices of gold and silver have also risen markedly.

In the Chinese market, the overall performance of A-shares was relatively stable, successfully holding the 3,000 mark, despite the 1.6% drop in the Hang Seng Technology Index. China Securities declined overall, falling for four consecutive days, hitting a new low in February. Among them, NIO Auto fell by more than 2%, while Bilibili reversed the market and rose more than 5%. The offshore RMB exchange rate against the US dollar also declined, falling below 7.29 for the first time in seven months.

Overall, although the market is affected by major data and policy decisions, the volatility of global financial markets is still significant, and investors need to be alert and adjust their strategies in due course to deal with possible market fluctuations.

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