Dow Jones Industrial Average hits a new high

On Monday, Eastern Time, U.S. stocks continued their strong rebound, with the Nasdaq up nearly 1%, the Dow hitting a new all-time high, and the S&P 500 index just one step away from its historical peak. As the dollar weakens, precious metals led by gold and silver surged across the board.

White House National Economic Council Director Brian Deese, in an interview with CNBC, issued a caution about upcoming employment data. He stated that employment growth over the next few months is expected to slow, but this does not mean a weakening growth momentum; rather, it reflects structural changes in the labor market.

Alphabet raised $20 billion through dollar bonds, exceeding the initial plan of $15 billion, and for the first time issued bonds in the Swiss and UK markets. According to sources, the demand for Alphabet’s bond issuance has already exceeded $100 billion.

Major U.S. stock indices close higher collectively

On Monday, U.S. stock indices all closed higher. Led by technology stocks, the Nasdaq rose nearly 1%, the Dow hit a new all-time high, and the S&P 500 increased by nearly 0.5%, approaching its all-time high. At the close, the Dow rose 0.04% to 50,135.87 points; the S&P 500 increased 0.47% to 6,964.82 points; and the Nasdaq gained 0.90% to 23,238.67 points.

Last week, the U.S. stock market experienced a “sell-off” triggered by the software sector. However, it rebounded sharply on Friday, with the Dow breaking the 50,000 mark for the first time in history. Into this week, stocks continued their rebound, with the tech giants performing strongly. The recent plunge has provided attractive entry points for some individual stocks.

Market analysts believe that recent volatility may continue, and whether the fundamentals of tech stocks can sustain their valuations remains to be seen.

Morgan Stanley strategist Michael Wilson’s team believes there is still room for further gains in U.S. tech stocks, supported by the AI boom which has bolstered strong sales prospects. Revenue growth expectations for large tech companies have reached “decades-high levels,” although valuations have declined after recent market fluctuations.

Chris Senyek of Wolfe Research noted that sectors like consumer staples, which performed well this year, are now seriously overbought, and non-software tech stocks remain “very crowded” among institutional investors and retail traders. Further systemic selling could continue in the short term.

Most large tech stocks rose: Nvidia up 2.50%, Apple down 1.17%, Microsoft up 3.11%, Google up 0.45%, Amazon down 0.76%, Meta up 2.38%, Tesla up 1.51%, Broadcom up 3.31%, Oracle up 9.64%, Netflix down 0.89%, AMD up 3.63%.

Popular Chinese concept stocks had mixed performances: Nasdaq Golden Dragon China Index up 0.12%, Alibaba up 0.30%, JD.com down 0.21%, Pinduoduo up 0.32%, NIO down 2.98%, XPeng down 1.02%, Li Auto down 3.27%, Bilibili down 2.41%, Baidu up 0.71%, NetEase up 0.50%, Tencent Music down 0.43%, Pony.ai up 3.49%.

The US dollar index weakened, falling 0.78% on Monday and breaking below the 97 level, supporting the commodities market. Precious metals surged across the board, with spot gold continuing its rebound and surpassing the $5,000 mark; spot silver rose over 7% intraday. COMEX gold futures gained over 2%, and COMEX silver futures soared 8%.

Deese issues a “caution” on employment data

On Monday, White House National Economic Council Director Brian Deese, in an interview with CNBC, issued a “caution” regarding upcoming employment data.

He said that employment growth over the next few months is expected to weaken, but this does not mean a slowdown in growth; rather, it reflects structural changes in the labor market, as companies achieve higher output through technological advances and efficiency improvements, reducing the demand for new labor.

Deese believes that, given slow population growth but “soaring” productivity growth, lower employment figures will still be consistent with high GDP growth.

He added that the so-called “balanced employment growth rate”—the monthly employment increase needed to keep unemployment stable—is “far below” the levels during President Biden’s administration. This explanation aims to rationalize the lower employment growth figures.

Deese’s comments on labor data pushed U.S. Treasury prices higher.

He also stated that GDP growth is “very strong,” with an expected annual growth rate of 4.0% by the end of the year, and an overall growth rate of 3.0% for the year, attributing last year’s negative first-quarter growth to the Biden administration.

Alphabet’s bond demand exceeds $100 billion

Alphabet’s global bond issuance set a record, planning to issue century bonds to support AI investments.

On Monday, Eastern Time, Alphabet raised $20 billion through dollar bonds, exceeding the initial plan of $15 billion, and for the first time issued bonds in the Swiss and UK markets.

Sources say that demand for Alphabet’s bonds has already exceeded $100 billion. This level of demand is among the most vigorous in corporate bond issuance history, indicating strong investor interest in debt assets related to the AI boom.

Alphabet’s UK pound bond issuance includes maturities ranging from 3 years to 100 years, with pricing possibly as early as Tuesday. The UK bond market has been a preferred choice for issuers seeking long-term financing, driven by strong demand from UK pension funds and insurers.

Last week, Alphabet announced capital expenditures of up to $185 billion this year, surpassing its total spending over the past three years. Morgan Stanley estimates that cloud computing giant will borrow $400 billion this year, pushing investment-grade bond issuance to a record $2.25 trillion.

Some credit strategists warn that such large-scale issuance could widen corporate bond spreads. Vishwas Patkar, head of U.S. credit strategy at Morgan Stanley, said this is similar to the situations in 1997-98 or 2005, “credit performance is poor, but it’s not the ‘end of the cycle’.”

Just last week, Oracle raised $25 billion through bond issuance, with a record demand of $129 billion.