Bessent urges Fed rate cuts; US sectors in recession; October car deliveries reported.

US Economic Concerns and Market Updates

Economic Recession Signals

US Treasury Secretary Besant stated that certain sectors of the US economy have already entered a recession. He warned that if the Federal Reserve does not lower interest rates further, other sectors may follow suit. However, he did not specify which sectors are affected. Besant highlighted that the Fed's policies have created significant distribution issues, particularly in the housing market and for low-income consumers. He believes that lowering interest rates could address the "housing recession" and assist consumers with more liabilities than assets.

Government Shutdown and Food Aid Crisis

As of October 31, the US government shutdown is nearing its 32nd day, just three days shy of the record 35 days set in 2018-2019. The impending expiration of funding for the Supplemental Nutrition Assistance Program (SNAP) on November 1 threatens to escalate a severe livelihood crisis for 42 million Americans. The Senate plans to vote on November 3, but bipartisan disagreements persist on key issues.

Federal Reserve Divergence and Market Reactions

The Federal Reserve is experiencing rare internal disagreements, with notable figures like "bond king" Gross shorting US Treasuries. Fed Governor Waller suggested ignoring tariff-driven inflation, indicating that core inflation rates are around 2.5%. Predictions suggest a rate cut in December, although the probability has dropped from 91.7% to 71.3% recently. Gross's pessimism about US Treasuries stems from expanding deficits and a weakening dollar.

Stock Market Performance

On October 31, US stock indices collectively rose, with the Dow Jones up 0.09% to 47,562.87 points, the S&P 500 up 0.26% to 6,840.20 points, and the Nasdaq up 0.61% to 23,724.96 points. Amazon's stock surged nearly 10%, reaching a new all-time high after reporting a 20% revenue increase in its cloud computing division.

Berkshire Hathaway's Strong Q3 Results

Berkshire Hathaway reported a 34% increase in operating profit for Q3, reaching $13.485 billion, with cash reserves hitting a record $381.7 billion. Despite this, the company has not repurchased shares for nine months, indicating a cautious investment approach from Warren Buffett.

Hong Kong Market Movements

On October 31, southbound funds net bought HK stocks worth HKD 8.719 billion, with Xiaomi receiving over HKD 640 million in net purchases. However, Tencent saw a net sell-off of over HKD 1.219 billion.

Automotive Deliveries in October

In October, Zeekr delivered 61,636 vehicles, marking a 9.8% year-on-year increase. Xpeng and Xiaomi also reported strong deliveries, with Xpeng achieving a record high of 42,013 vehicles.

Upcoming Economic Data

On Monday, key economic data will be released, including the US ISM Manufacturing PMI for October. The People's Bank of China will also have a significant reverse repurchase agreement maturing today.