Tonight, the U.S. retail sales for December are 0% month-on-month, significantly below the expected 0.4%. Previously, Powell and Wall Street's 'golden-haired girl' narrative is facing the risk of being exposed.
December is the Christmas season in the U.S., a traditional peak retail period. A 0% month-on-month figure reflects the slowdown in consumption for most groups under the K-shaped economy, with domestic demand increasingly driven by the affluent.
Of course, the U.S. economy has two other 'stories' to tell besides domestic demand: one is the AI narrative, with increasing evidence of productivity improvements; the AI investment guideline of 650 billion for 26 years was announced this quarter; the second is the growth in net exports, both of which will boost GDP.
However, these two factors will not significantly improve employment or residents' income. In other words, there will be a stark contrast between the perceived benefits to American residents and GDP growth.
Affected by retail sales, the Nasdaq opened lower and fluctuated tonight, with Bitcoin, gold, and silver following suit. Major asset classes are now being quantitatively influenced by CTAs, and their synchronized rises and falls are becoming increasingly apparent.
There's a good chance the non-farm payrolls report tomorrow will be disappointing. Hassett must have seen the data beforehand before issuing the warning. The market generally expects the downward revision of the 2025 forecast to result in zero employment growth for the entire year. If this is the case, the current optimism in the US stock market will be dampened, and the current volatile market will continue.
The domestic AI market has entered its pre-holiday phase and is rather lackluster. Highlights include ByteDance's Seendance AI video generation, innovative drugs, and film and television – all traditionally expected sectors during the Spring Festival holiday. Hopefully, more good news will emerge during the holiday.
Tonight's Q4 monetary policy report from the People's Bank of China (PBOC) expressed satisfaction with the current level of coordination between monetary and fiscal policies, highlighted the importance of bank net interest margins, affirmed the stability of the bond market, and commended the entry of insurance funds into the market and the transfer of household deposits. These factors provide the underlying support for the current slow bull market in A-shares, indicating a high degree of certainty in the market's direction.
The central bank also specifically mentioned the "online retail industry" and the "pharmaceutical industry," which is a sign of support for the Hang Seng Bank. Good for them; they should mention these more often in the future.
Overall market performance was relatively stable. Let's wait and see what tomorrow brings regarding the non-farm payrolls data. It might be a minor negative factor, but if the market falls, it could present an opportunity to watch.
Bitcoin and gold/silver have both been consolidating after sharp declines recently, using time to create space; patience is key.
