Recession and interest rate cuts are good to be far away...

Recession and interest rate cuts are good to be far away... U.S. stock market, interest rate surge on employment report but rise on related interpretation and reversion

The U.S. stock market started strong on the back of strong employment reports, despite a sharp rise in government bond rates and the dollar's expansion. This is estimated to be due to the influx of rebound buying following the fall in late trading due to geopolitical risks the previous day. On top of that, as the dollar's strength declined, reflecting the slowdown in wage growth from 4.3% to 4.1% year-on-year after the interpretation of the employment report results, and the progress of ceasefire negotiations over Gaza over the weekend, the stock market expanded with the focus on technology stocks. However, when the 10-year index surged to 4.4% (Dau +0.80%, Nasdaq +1.24%, S&P 500 +1.11%, Russell 2000 +0.47% and Philadelphia Semiconductor Index +1.33%)

* Variables: Interpretation of employment reports and Fed members' comments

In the U.S. March employment report, the number of non-agricultural employees rose to 30.3 million, significantly exceeding the expected 200,000 cases announced last month, and the unemployment rate improved from 3.9 to 3.8 percent. Hourly wages rose from 0.2 percent to 0.3 percent month-on-month, but slowed from 4.3 percent to 4.1 percent year-on-year. In detail, healthcare increased from 8.2 million to 80,000 month-on-month, leisure and hospitality industries increased from 4.3 million to 4.9 million, and the government also drove the job market by 7.1 million cases from 63,000 cases. On the other hand, the manufacturing industry increased by 1.8 million cases in transportation equipment and automobiles, which fell last month, but most of them, including IT, declined, showing no change

The hourly wage was $34.69, 0.35% month-on-month, up from 0.17% announced last month. While construction and manufacturing industries increased, private education, leisure and hospitality, and other services slowed month-on-month. As a result, the dollar strengthened against other exchange rates, government bond rates soared, and the stock market was sluggish. In particular, CME FEDWatch lowered the probability of a rate cut in June from 65.9% to 53.3%, and the probability of three or more cuts by December decreased from 66.3% to 56.2%.

However, some markets reacted to the slowdown in wage growth from 4.3% to 4.1% year-on-year, and some members, including Fed Chairman Powell, have noted that increased immigration will cause wage growth to fall. On top of that, the Gaza ceasefire negotiations, highlighting a possible delay in Iran's response to Friday's Quds Day, are believed to have led to the dollar's contraction during the session. Of course, government bond rates have surged, reflecting the decline in response to employment indicators and geopolitical risks the previous day

Meanwhile, Dallas Fed Governor Lori Logan argued that we don't have to wait until prices reach 2%. Richmond Fed Governor Thomas Barkin noted that immigration has affected employment data while strong employment data, but argued that higher interest rates could eventually slow the U.S. economy. Strongly hawkish Fed Director Michelle Bowman said she could raise interest rates if inflation stagnates, but ruled out anything in December. She also argued that inflation would slow down if rates were kept high. At the same time, it shows that she is paying attention to the economy, saying that if the economy worsens, her views could change

* Features: Semiconductors, big tech stocks strengthen Vs. Tesla slump

Tesla (-3.63 percent) plunged more than 6 percent after Reuters reported during the day that it would cancel the development of Model 2 of a low-cost vehicle due to intensifying competition with Chinese electric vehicles after the downward revision of its target stock price with Daiwa. However, when CEO Musk mentioned that the report directly related to the report was false, the fall was reduced, but the fall expanded again as the option market and lawsuits were highlighted. On the other hand, Chinese companies such as Nio (-2.44%), Xpeng (-0.40 percent), and Li Auto (+0.67 percent) rose and then narrowed their gains or shifted downward after Musk's remarks.

Meta Platforms (+3.21 percent) rose as expectations for its recent earnings increased. Netflix (+3.09 percent) gained ground after Pivotal raised its target price, citing an increase in subscribers. Amazon (+2.82 percent) rose as Mizuho remained its top pick, saying it was optimistic about cloud services. Apple (+0.45 percent) rose despite news that some 600 employees estimated to be involved in the Apple car project will be fired. Bernstein's announcement that the iPhone 16 will become stronger periodically, which is affected by the announcement that the company will maintain its growth story

Semiconductor-related stocks such as Nvidia (+2.43 percent), Broadcom (+1.66 percent), and AMD (+2.77 percent), as well as software stocks such as ServiceNow (+3.43 percent), Salesforce (+2.64%) and Intuit (+2.33%) are strong despite rising government bond rates due to backlash from previous day's decline. MarvellTech (+2.50 percent) rose as BOA commented at its conference on Wednesday that it would announce a new AI-tailored product. Western Digital (+3.64 percent) gained ground as investment firm Rosenbrat raised its investment opinion and target price, citing rising NAND prices. Intel (-2.57 percent), on the other hand, has been on a steady decline since the announcement that it lost $7 billion in its foundry business last year. Amid this development, investment firm Bernstein's announcement that there was no real reason to own it by 2030 led to a sharp decline. Philadelphia Semiconductor index rose 1.33 percent.

Eli Lilly (+2.10 percent) rose as JPMorgan maintained its above-market earnings rating saying its earnings will be positive on Thursday. J&J (-0.07 percent) fell on the news that it had agreed to acquire Shockwave Medical (+1.98 percent), a medical device company, but Shockwave rose. Inphase Energy (-7.05 percent) fell after Citi lowered its investment opinion and target price, saying the trend in the U.S. along with Plug Power (-0.32 percent) was weakening. Snowflake (+1.67 percent) gained ground after investment firm Rosenbet raised its investment opinion to buy reflecting consumer interest.

* South Korean stock market-related figures

The MSCI South Korean index ETF lost 0.02%, but the MSCI Emerging Index ETF gained 0.22%. The Russell 2000 index of smaller companies rose 0.47%, the Dow Transportation Index rose 0.76%, and the Philadelphia Semiconductor index rose 1.31%. Night futures rose 0.71%. NDF dollar/won exchange rate hit 1,349.50 won for the one-month trade, which affects the dollar/won exchange rate, which closed at 1,347.10 won last Friday

* FICC: Treasury yields surge in fallout from reversals and employment report

International oil prices have risen on the back of strong employment skills and confidence in the economy. Furthermore, the possibility of increased risks in the Middle East has been highlighted by strong criticism of Israel by Islamic countries on the previous day. However, Iran's response may be delayed on the occasion of Quds Day, and the news that ceasefire negotiations over Gaza will take place over the weekend have curtailed its gains. U.S. natural gas prices have also fluctuated

The dollar also strengthened its strength against other exchange rates after the release of a strong employment report. In particular, weak retail sales in the Eurozone were affected. However, rising expectations that risks in the Middle East, including the Gaza negotiations, strengthened the preference for risky assets and reduced the dollar's strength. The euro has been strong, leaving behind weakness, but turned to weakness, reflecting economic concerns caused by sluggish retail sales. The yen strengthened preference for risky assets and weakened against the dollar

Government bond rates have soared, reflecting strong U.S. employment, with the number of non-agricultural employees exceeding 300,000. On top of that, Federal Reserve Bank of Dallas Governor Lori Logan insisted that he would not rush to cut rates, and Fed Director Michelle Bowman said that she could raise rates if inflation stagnates. Also, the stock market continues to be strong and the preference for risky assets is increasing as the U.S. economic indicators continue to improve.

Gold rose, reflecting the dollar's strength. In addition, one of the reasons for the increase was that the greenback returned from its late-day gains. Copper and nonferrous metals fell on the possibility of a delay in U.S. interest rate cuts after copper was at a 14-month high. Other items were mostly lower, with nickel only strengthening. Wheat rose more than 2% after restricting the departure of ships carrying Russian grain, highlighting a possible reduction in wheat exports due to sanctions against Russia this year. Soybean and other strengthened