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

【U.S. Stock Indices】

On February 13th, Friday, U.S. major stock indices closed mixed, with the S&P 500 up 0.05% at 6,836.17; the Dow Jones up 0.10% at 49,500.93; and the Nasdaq down 0.22% at 22,546.67.

【U.S. Treasury Bonds】

On February 13th, the benchmark 10-year U.S. Treasury yield was 4.04%, and the yield on the 2-year Treasury, 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 C declined 1.08%, Google A down 1.06%, Microsoft decreased 0.13%, Amazon fell 0.41%, TSMC declined 0.51%, Meta dropped 1.55%, Tesla rose 0.09%, Seagate Technology increased 0.67%, and Intel rose 0.67%.

【Global Indices】

【China Indices】

On February 13th, overnight Hang Seng Tech Index futures fell 1.04%, Nasdaq China Golden Dragon Index declined 0.10%, and 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 rose 1.41%, and NIO decreased 0.10%.

【Forex and Commodities】

【Global News】

SpaceX Rumored to Adopt Dual-Class Share Structure in IPO to Strengthen Musk’s Control

Sources say SpaceX is considering using a dual-class share structure in its planned IPO this year, similar to strategies proposed by 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 will raise interest rates at least once this year, which would significantly boost the euro against the dollar. This contradicts many investors and economists who expect the ECB to keep rates unchanged until 2027. Some even anticipate that if the Fed’s rate cuts under new Chair Powell lead to easing in Europe, the ECB might loosen policy. Currently, the market assigns less than a one-in-three chance of a 25 basis point rate cut. However, Capital Group’s investment director Edward Harrold expects European economic growth to accelerate, causing a divergence from Fed policy. He predicts the euro will rise to the upper 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 insiders reveal that the Fed plans to appoint Randall Guynn, a seasoned Wall Street lawyer with deep banking ties, as the new Director of Supervision. Guynn, formerly a 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 approval by the seven-member Fed Board. The timing of the vote is unclear. Once appointed, he will report to Barr. Choosing Guynn marks a significant shift in Fed personnel, as this role has traditionally been held by long-serving internal staff since at least 1977. (Sina Finance)

Goldman Sachs: Still Expecting 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. This depends on continued signs of labor market improvement, as the FOMC is highly sensitive to labor market weakness. Goldman still expects two rate cuts this year, with the next in June.

Institutions: Powell Faces “Delicate Balance” Between Employment and Inflation Toward 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, non-farm payrolls showed stronger-than-expected job gains and unemployment fell to 4.3%. While slowing inflation and steady employment are positive, Fed Chair Powell’s last months in office require balancing: curbing inflation without harming the labor market. Aggressive rate hikes in 2022 helped tame soaring prices, but with inflation easing 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 Fed Easing in June to 69%, Up from 63% Before CPI Data

U.S. interest rate futures now price in a 69% chance of the Fed easing in June, up from 63% prior to CPI release.

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

Traders assign a 50% probability that the Fed will cut rates a third time this year.

U.S. CPI Year-over-Year at Lowest Since May Last Year

January’s unadjusted U.S. CPI 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 think holding hearings is 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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