Global News | U.S. stocks fluctuate, Federal Reserve rate cut expectations rise to 69%

【U.S. Stock Indices】

On February 13th, Friday, the three major U.S. stock indices moved mixed. The S&P 500 rose 0.05% to 6,836.17; the Dow Jones increased 0.10% to 49,500.93; the Nasdaq declined 0.22% to 22,546.67.

【U.S. Bonds】

On February 13th, the benchmark 10-year U.S. Treasury yield was 4.04%, and the 2-year Treasury yield, most sensitive to Federal Reserve policy rates, was 3.40%.

【Popular U.S. Stocks】

Among popular stocks, Nvidia fell 2.23%, Apple dropped 2.27%, Google Class C declined 1.08%, Google Class A fell 1.06%, Microsoft decreased 0.13%, Amazon declined 0.41%, TSMC dropped 0.51%, Meta fell 1.55%, Tesla rose 0.09%, Seagate Technology increased 0.67%, Intel rose 0.67%.

【Global Indices】

【Chinese Indices】

On February 13th, overnight Hang Seng Tech Index futures fell 1.04%, Nasdaq China Golden Dragon Index declined 0.10%, FTSE China A50 Index dropped 1.27%.

【Chinese Concept Stocks】

In popular Chinese concept stocks, Tencent Holdings (HK) fell 0.65%, Alibaba dropped 1.95%, Pinduoduo rose 0.06%, NetEase increased 2.07%, Baidu declined 0.99%, Ctrip fell 0.06%, Li Auto dropped 1.81%, Xpeng Motors rose 1.41%, NIO declined 0.10%.

【Forex and Commodities】

【Global News】

SpaceX Reportedly Plans Dual-Class Share Structure in IPO to Strengthen Musk’s Control

Sources say SpaceX is considering adopting a dual-class share structure in its planned IPO this year, similar to strategies proposed by its billionaire founder Elon Musk for Tesla. This structure would give certain shareholders extra voting rights, allowing them to dominate decision-making. It would enable Musk and insiders to retain control even with minority ownership. Insiders also say the company is adding board members to facilitate the IPO and support Musk’s space ambitions beyond core rocket and satellite businesses. (Cailian Press)

Asset Management Giant Capital Group Bets on ECB Rate Hikes in 2026, Contradicting Mainstream Views

Capital Group, managing $3.3 trillion, states that the European Central Bank (ECB) will raise interest rates at least once this year, significantly boosting the euro against the dollar. This contradicts many investors and economists who expect the ECB to keep rates unchanged until 2027. Some even predict that if the Fed’s new chair cuts rates, the ECB might loosen policy. Currently, the market assigns less than a one-in-three chance of a 25 basis point cut. However, Capital Group’s investment director Edward Harrold expects European economic growth to accelerate, causing a divergence in policy paths between the ECB and Fed. He predicts the euro could rise to the high end of the 1.20 range by year-end. The euro closed around 1.1860 against the dollar on Friday. (Sina Finance)

Federal Reserve Expected to Appoint Wall Street Lawyer Quinn as Head of Supervision

Two sources say the Fed plans to appoint Randall Guynn, a seasoned Wall Street lawyer with deep banking ties, as the new Director of Supervision. Guynn, a former partner at Davis Polk & Wardwell, has represented major U.S. banks. He will succeed Michael Gibson, who retired last July after over 30 years at the Fed. Since May 2025, Guynn has served as an advisor to Fed Board Vice Chair for Supervision Michael Barr. His appointment still requires a vote by the seven-member Fed Board. The timing of the closed-door vote is unclear. Once appointed, he will report to Barr. Choosing Guynn marks a significant shift in Fed personnel, as this position has traditionally been held by long-serving internal staff since at least 1977. (Sina Finance)

Goldman Sachs: Still Expect Two Rate Cuts by the Fed This Year, Next in June

Lindsay Rosner, head of multi-sector fixed income at Goldman Sachs Asset Management, says that with January’s CPI data not as strong as feared, the Fed’s rate normalization path appears clearer. It depends on whether the labor market continues to improve, as the FOMC is highly sensitive to labor market weakness. They still expect two rate cuts this year, with the next in June.

Institutions: Powell Faces “Delicate Balance” Between Employment and Inflation at End of Term

An analysis of the January CPI report shows YoY inflation at 2.4%, below previous and market expectations; core CPI, excluding volatile food and energy, rose 2.5%, in line with forecasts. Earlier this week, the non-farm payroll report showed stronger-than-expected job gains and unemployment at 4.3%. Despite easing inflation and solid employment, Powell faces a delicate balance in his final months as Fed Chair: curb inflation without harming the labor market. Aggressive rate hikes helped tame 2022 price surges, but with inflation receding and employment cooling, the Fed has cut rates nearly 2 percentage points since summer 2024 and paused in January. As signs of easing price pressures grow, economists broadly expect inflation to decline further by 2026.

U.S. Interest Rate Futures Slightly Increase Probability of Rate Cuts in June to 69%, Up from 63% Before CPI Data

U.S. interest rate futures have slightly increased the probability of a rate cut in June to 69%, up from 63% before the CPI release.

Traders See 50% Chance of Third Rate Cut by the Fed This Year

Traders estimate a 50% chance that the Fed will cut rates a third time this year.

U.S. CPI Yearly Rate Falls to Lowest Since May Last Year

The January CPI, unadjusted, rose 2.4% YoY, down from 2.7%, the lowest since May 2025, with a median market expectation of 2.5%.

U.S. Treasury Secretary: Senate Finance Committee Agrees to Hold Hearing on Wosh’s Fed Nomination

Treasury Secretary Yellen said Friday that, despite reservations from a key senator, the Senate Finance Committee has agreed to move forward with hearings on President Trump’s nominee, Wosh, for Fed Chair. She emphasized, “I believe hearings are crucial. Chair Powell’s term ends mid-May, and anyone concerned about the Fed’s integrity and independence wants to see Kevin Wosh ensure continuity.”

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