InvestMacro

By JustMarkets

As of Thursday’s stock market close, the Dow Jones Index (US30) was down 0.35%, the S&P 500 Index (US500) decreased by 0.29%, and the NASDAQ Technology Index (US100) closed negative 0.30%.

The US weekly initial jobless claims fell by 1,000 to 209,000, indicating a stronger labor market than expectations of a rise to 218,000. Thursday’s US retail sales report for February 0.6% m/m was weaker than market expectations of 0.8%, while the January figure was revised downward to 1.1% m/m from 0.8%. The February PPI reading of 1.6% y/y was stronger than market expectations of 1.2% and exceeded the revised January reading of 1.0% y/y (preliminary 0.9%). However, February core PPI fell to a 2-year low of 3.8% y/y. Either way, February’s core CPI and PPI remain above the Fed’s 2% inflation target.

After the release of macro statistics, UST yields started to rise, and stock indices were corrected. Investors fear that amid high inflation, the Fed may reduce the number of scheduled rate cuts this year from three to two. So far, this is unlikely, but any hints from Mr. Powell on this trend at the upcoming meeting may trigger the beginning of a correction in the indices.

Shares of Tesla (TSLA) closed 4.12% lower, adding 4.81% to Wednesday’s losses. UBS lowered its price target for Tesla on Thursday from $165 to $225 but maintained a neutral rating. The bearish sentiment on TSLA has persisted since Wednesday, when Wells Fargo downgraded Tesla to “underweight” from “equal-weight” due to its view that electric vehicle sales will remain flat in 2024 and decline in 2025.

Equity markets in Europe were mostly down yesterday. Germany’s DAX (DE40) was down 0.11%, France’s CAC 40 (FR40) added 0.29%, Spain’s IBEX 35 (ES35) lost 0.66%, and the UK’s FTSE 100 (UK100) closed negative 0.37%.

ECB Governing Council spokesman Stournaras said on Thursday that he favors two interest rate cuts before the ECB’s August break and two more before the end of the year. He also said a rate cut in June is more likely than one in April. Swaps estimate the odds of a 25 bps ECB rate cut at 10% at the next meeting on April 11 and 90% at the next meeting on June 6. In Europe today, investors will assess final inflation data in France and Italy.

Oil prices rose because of an IEA report released on Thursday that said oil markets will face a supply shortage by the end of this year due to OPEC+ production cuts. On Thursday, the International Energy Agency (IEA) predicted that global oil markets would be in deficit by the end of 2024 if OPEC+ maintained its current production cuts. However, the balance would become a surplus if OPEC+ started pumping more oil. OPEC+ will meet on June 1 to decide on production levels for the second half 2024.

Natural gas prices rose Thursday after the EIA’s weekly report showed US gas inventories fell by 9 billion cubic feet, which was higher than market expectations of 2 billion cubic feet. Natural gas prices are also under pressure after the Freeport LNG natural gas export terminal in Texas shut down one of three production units on March 1 due to damage caused by freezing weather in Texas. The unit is scheduled to resume operations this week.

Asian markets were predominantly up yesterday. Japan’s Nikkei 225 (JP225) rose by 0.29% on the day, China’s FTSE China A50 (CHA50) declined 0.23%, Hong Kong’s Hang Seng (HK50) gained 0.71% on Thursday, and Australia’s ASX 200 (AU200) was positive 0.20%.

Major Japanese companies have already agreed to meet union demands for wage increases. This raises the possibility that the central bank (BoJ) could exit its negative interest rate policy as early as next week due to rising wages, high inflation, and a stable economy.

Australia’s economy grew less than expected in the fourth quarter, supporting bets that the Reserve Bank of Australia (RBA) may start cutting rates this year. Markets currently estimate a 70% probability of the RBA starting to cut the money rate in August, with 40 basis points of easing this year.

The National Bureau of Statistics released Chinese house price data for February for a sample of 70 cities, which showed continued price declines in line with expectations. Average primary market prices fell 0.36% month-over-month, while average secondary market prices fell 0.62% month-over-month. Both figures were similar to the January decline.

S&P 500 (US500) 5,150.48 −14.83 (−0.29%)

Dow Jones (US30) 38,905.66 −137.66 (−0.35%)

DAX (DE40) 17,942.04 −19.34 (−0.11%)

FTSE 100 (UK100) 7,743.15 −29.02 (−0.37%)

USD Index 103.36 +0.57 (+0.55%)

• – US NY Empire State Manufacturing Index (m/m) at 14:30 (GMT+2);
• – US Industrial Production (m/m) at 15:15 (GMT+2);
• – US Michigan Consumer Sentiment (m/m) at 16:00 (GMT+2).

By JustMarkets

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

By JustMarkets

At Wednesday’s close of the stock market, the Dow Jones Index (US30) was up 0.09%. The S&P 500 Index (US500) decreased by 0.19%. The NASDAQ Technology Index (US100) closed negative 0.54%. The Dow Jones Industrials Index received support from companies such as 3M (MMM) with a gain of 5.42%, as well as Chevron (CVX), Caterpillar (CAT), Home Depot (HD), NIKE (NKE), Goldman Sachs (GS) and Coca Cola (KO) with gains of more than 1%.

Fed Chairman Powell said last week that the Fed is “not far” from being confident enough to cut interest rates. However, markets rate the Fed’s probability of cutting interest rates at its meeting next week as near zero, as inflation is still too far above target. Markets estimate the odds of a 25 bps rate cut at next week’s March 20 FOMC meeting at 1%, the May 1 meeting at 13%, and the June 12 meeting at 73%.

Equity markets in Europe mostly went up yesterday. Germany’s DAX (DE40) was down 0.02%, France’s CAC 40 (FR40) added 0.62%, Spain’s IBEX 35 (ES35) index increased by 1.65%, and the UK’s FTSE 100 (UK100) closed positive 0.31%. The FTSE Index closed at 7,772 on Wednesday, the highest in ten months and marking the third consecutive session of gains. Market sentiment was driven by positive economic data that boosted hopes that the UK is recovering. UK Gross Domestic Product rose by 0.2% month-on-month in January, driven by strong retail and house-building performance.

ECB council spokesman Martins Kazaks said Wednesday that rate cuts could come within the next few meetings. His counterpart, Bank of France Governor Francois Villeroy de Galhau, said the ECB’s first rate cut is more likely in June than April.

WTI crude oil prices rose to $80 a barrel on Thursday, extending gains from the previous session, as an unexpected drop in US crude inventories signaled strong demand in the world’s top oil consumer. EIA data showed US crude inventories fell by 1.536 million barrels last week, contradicting expectations of a 1.338 million barrel increase. It was the first decline in seven weeks, confirming industry data reported Tuesday by API. In addition, the report noted a decline in inventories at the Cushing hub in Oklahoma and a decrease in gasoline inventories.

Silver prices (XAGUSD) rose to $24.7 an ounce, the highest since early December. They followed gains in other precious metals amid growing expectations that major central banks will soon start cutting interest rates. The Fed and ECB are expected to begin easing monetary policy in June, while the Bank of England will likely make its first rate cut in August.

Asian markets traded flat yesterday. Japan’s Nikkei 225 (JP225) was down 0.26% on the day, China’s FTSE China A50 (CHA50) was up 0.89%, Hong Kong’s Hang Seng (HK50) lost 0.07% on Wednesday, and Australia’s ASX 200 (AU200) was positive 0.22%. The Hang Seng Index (HK50) moved further away from the 3-month highs reached earlier in the week after Wall Street fell from recent highs overnight due to losses in chipmaker stocks, and market participants were wary of new key US economic data ahead of next week’s FOMC meeting.

The US House of Representatives passed a landmark bill that gives Chinese TikTok owner ByteDance six months to sell a controlling stake or the app will be blocked in the US.

Investors remain cautious amid growing speculation that the Bank of Japan (BoJ) could adjust its monetary policy as early as next week due to rising wages, inflation, and a strong economy. The country also concluded this year’s spring wage talks on Wednesday, with several major Japanese companies agreeing to solid wage increases.

S&P 500 (US500) 5,165.31 −9.96 (−0.19%)

Dow Jones (US30) 39,043.32 +37.83 (+0.097%)

DAX (DE40) 17,961.38 −3.73 (−0.021%)

FTSE 100 (UK100) 7,772.17 +24.36 (+0.31%)

USD Index 102.80 -0.16 (-0.16%)

• – Switzerland Producer Price Index (m/m) at 09:30 (GMT+2);
• – US Producer Price Index (m/m) at 14:30 (GMT+2);
• – US Retail Sales (m/m) at 14:30 (GMT+2);
• – US Initial Jobless Claims (w/w) at 14:30 (GMT+2);
• – US Natural Gas Storage (w/w) at 16:30 (GMT+2).

By JustMarkets

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

By ForexTime

Article by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

By JustMarkets

At Tuesday’s stock market close, the Dow Jones Index (US30) rose by 0.61%. The S&P 500 Index (US500) was up 0.61%. The NASDAQ Technology Index (US100) closed positive 1.54%. Despite a slight rise in inflation, stock indices refuse to fall. The bullish consensus in the market is so strong that it is almost unrealistic to turn this train around without a significant negative trigger. It is probably not worth waiting for any changes in the market until the quarterly expiration this Friday.

The market focus will shift to the Fed meeting next week on March 20. If the market does not hear any negative signals from Mr. Powell, the best strategy for the coming months will be to follow the bullish trend and buy risky assets. Currently, markets are pricing the odds of a 25 bps rate cut at 1% for next week’s FOMC meeting on March 20, 15% for the next meeting on May 1, and 78% for the subsequent meeting on June 12.

Shares of Oracle (ORCL) jumped by 11.88% on Tuesday after its earnings report beat market expectations on Monday, thanks to a surge in orders for cloud services. The company said that demand for Gen2 AI infrastructure is significantly outstripping supply. Boeing (BA) fell another 4.17% following news that officials in Chile have launched an investigation into a flight traveling from Auckland to Sydney where a violent air shake was reported, resulting in the hospitalization of 10 people and injuries to 50 people. In addition, the CEO of United Airlines told Boeing that it no longer wants to deliver Boeing 737 Max 10 airplanes because of delays in certification.

Equity markets in Europe mostly went up yesterday. Germany’s DAX (DE40) rose by 1.23%, France’s CAC 40 (FR40) gained 0.84%, Spain’s IBEX 35 (ES35) added 0.61%, and the UK’s FTSE 100 (UK100) closed positive 1.02%.

There is broad agreement at the European Central Bank to start cutting interest rates in the spring as the fight against inflation is won, according to Governing Council spokesman Francois Villeroy de Galhau. The risk of waiting too long before easing monetary policy and unnecessarily hurting the economy is now equal to the risk of acting too soon and letting inflation recover. Policymakers can act independently of their counterparts at the Federal Reserve and will have ample room to adjust the pace of easing as needed once the process begins, the policymaker said.

WTI crude prices rose to around $78 a barrel on Wednesday, pulling back from two-week lows amid a favorable outlook for global demand. In its monthly report, OPEC said global oil demand is expected to grow by 2.25 million bpd in 2024 and 1.85 million bpd in 2025, unchanged from previous estimates. The group also raised its economic growth forecast for the current year, indicating room for improvement. In addition, industry data showed that US crude inventories unexpectedly fell by 5.521 million barrels last week, indicating healthy demand in the world’s largest oil consumer.

Asian markets traded flat yesterday. Japan’s Nikkei 225 (JP225) decreased by 0.06% on the day, China’s FTSE China A50 (CHA50) was up 0.89%, Hong Kong’s Hang Seng (HK50) added 3.05% on Tuesday, and Australia’s ASX 200 (AU200) was positive 0.11%.

Bank of Japan Governor Kazuo Ueda gave a slightly gloomier assessment of the economy ahead of the central bank’s policy meeting next week. Ueda told parliament that Japan’s economy is recovering at a moderate pace, although there is weakness in some data. He added that there are various ways to raise the cost of short-term borrowing if the central bank decides to end negative interest rates, but offered few clues. There has been increasing speculation recently that the Bank of Japan could start raising interest rates this month because of rising wages, high inflation, and a robust economy.

S&P 500 (US500) 5,175.27 +57.33 (+1.12%)

Dow Jones (US30) 39,005.49 +235.83 (+0.61%)

DAX (DE40) 17,965.11 +218.84 (+1.23%)

FTSE 100 (UK100) 7,747.81 +78.58 (+1.02%)

USD Index 102.93 +0.06 (+0.06%)

• – UK GDP (q/q) at 09:00 (GMT+2);
• – UK Industrial Production (m/m) at 09:00 (GMT+2);
• – UK Manufacturing Production (m/m) at 09:00 (GMT+2);
• – UK Trade Balance (m/m) at 09:00 (GMT+2);
• – Eurozone Industrial Production (m/m) at 12:00 (GMT+2);
• – US Crude Oil Reserves (w/w) at 16:30 (GMT+2).

By JustMarkets

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

By JustMarkets

The Dow Jones Index (US30) was up 0.12% at Monday’s stock market close. The S&P 500 Index (US500) was down 0.11%. The NASDAQ Technology Index (US100) closed negative 0.41%. Stocks traded slightly lower on Monday amid rising 10-year T-note yields and caution ahead of Tuesday’s US Consumer Price Index report. On an annualized basis, overall inflation is expected to fall to 3.1% from 3.2%. Core inflation (excluding food and energy prices) will fall from 3.9% to 3.8% y/y. In monthly terms, inflationary pressures are expected to rise by 0.3%. If the data comes out in line with consensus, it would indicate that underlying inflationary trends are not intensifying. However, a stronger-than-expected CPI report would dampen hopes of a near-term Fed rate cut, which could put additional pressure on the indices.

Shares of Nvidia (NVDA) are down 1.98% on Monday, adding to last Friday’s 5.47% selloff. Nvidia shares suffered profit-taking last Friday after initially hitting a record high and rising more than 17% over the previous six sessions. Boeing (BA) is down 3.0% after news that the US Department of Justice has opened a criminal investigation into the recent airborne door explosion on an Alaskan Airlines flight. Moderna (MRNA) was Monday’s best-performing stock of the NASDAQ benchmark (US100), adding 8.69%. The biotech company rose following news that it is partnering with Merck to begin a mid-stage study to test its experimental cancer vaccine on patients with skin cancer.

Bitcoin (BTCUSD) gained more than 4% on Monday and set a new record high, adding to last week’s 9.3% rally. Cryptocurrencies continue to rise because of the US Securities and Exchange Commission’s recent decision to allow spot bitcoin ETFs. However, shares of Coinbase (COIN) are down 0.93% on Monday, giving up an early rally of more than 4%.

Equity markets in Europe traded flat yesterday. Germany’s DAX (DE40) fell by 0.38%, France’s CAC 40 (FR40) lost 0.11%, Spain’s IBEX 35 (ES35) rose by 0.19%, and the UK’s FTSE 100 (UK100) closed positive 0.12%.

Shares of Austria’s Raiffeisen Bank closed 7.4% lower amid concerns over possible US sanctions over its relationship with Russia.

WTI crude oil prices climbed above $78 a barrel on Tuesday, recovering some of the losses of recent sessions. This week, markets await monthly reports from OPEC, the IEA, and the US EIA to assess the outlook for global demand. Investors continue to weigh conflicting supply and demand factors, as OPEC+ production cuts and tensions in the Middle East are offset by rising non-OPEC supply and signs of weak demand from major oil importer China. Data released last week showed that China’s oil imports fell about 5.7% to 10.8 million bpd in the first two months of the year, down from 11.44 million bpd in December.

The US natural gas price fell below $1.77 per Mmbbl to a two-week low, driven by reduced gas supplies to LNG export facilities and expectations of weaker demand due to milder weather in the next two weeks. Freeport LNG saw a nearly 50 percent drop in raw gas receipts last week due to the shutdown of one of its three processing lines. On the other hand, energy companies such as EQT and Chesapeake Energy cut gas production last month due to lower gas prices in February. Meanwhile, according to the latest EIA data, gas inventories as of March 1 are about 30.9% above normal levels.

Asian markets traded flat yesterday. Japan’s Nikkei 225 (JP225) was down 2.19% on the day, China’s FTSE China A50 (CHA50) was up 1.78%, Hong Kong’s Hang Seng (HK50) added 1.43% on Monday, and Australia’s ASX 200 (AU200) was negative 1.82%.

Hong Kong stocks climbed 1.2% in Tuesday morning trading to a two-week peak 16.735, maintaining bullish momentum for the third consecutive session amid gains in most sectors, especially healthcare, real estate, and consumer discretionary. Investors were scrambling to look for more catalysts after the close of China’s annual plenary meeting on Monday. During the event, Beijing set its 2024 GDP growth target at around 5.0% and planned to issue special bonds for large projects. At the same time, China’s central bank pledged to keep prices stable and said it may cut the refinancing rate further this year.

Japan’s business activity index for large manufacturing companies fell sharply to 6.7% in the first quarter of 2024 from 5.7% in the previous quarter, posting its lowest reading in a year and defying expectations for an improvement to 6.2%. The survey came amid official data that Japan’s economy fell into a technical recession in the fourth quarter of last year but was later revised to show a return to growth.

NAB Australia’s business confidence index fell to 0 in February 2024 from 1 in January. The reading was below the long-term average, with the retail sector among the top risk factors amid high borrowing costs and rising inflation.

S&P 500 (US500) 5,117.94 −5.75 (−0.11%)

Dow Jones (US30) 38,769.66 +46.97 (+0.12%)

DAX (DE40) 17,746.27 −68.24 (−0.38%)

FTSE 100 (UK100) 7,669.23 +9.49 (+0.12%)

USD Index 102.85 +0.14 (+0.13%)

• – Japan Producer Price Index (m/m) at 01:50 (GMT+2);
• – UK Average Earnings Index (m/m) at 09:00 (GMT+2);
• – UK Claimant Count Change (m/m) at 09:00 (GMT+2);
• – UK Unemployment Rate (m/m) at 09:00 (GMT+2);
• – German Consumer Price Index (m/m) at 09:00 (GMT+2);
• – US Consumer Price Index (m/m) at 14:30 (GMT+2).

By JustMarkets

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.