Daily Digest:
w/c 4 March 2024: US stock averages higher again to end the week, prodding at record levels; upcoming week's focus on the Fed's Powell testimony before Congress and the US Employment report

Erratic post US CPI as assets classes whipsaw

Intermediate

Macroeconomic/ geopolitical developments

  • US core consumer price index (CPI) inflation hit at four-decade high, at 6.6% year-over-year, higher than consensus.
US core inflation rate
  • Earnings season began, with US financials leading the way, overall posting above expectations.
earnings season
  • In the UK, the U-turns continue on the much-criticised mini budget, with the chancellor of the exchequer, Kwasi Kwarteng a political casualty, as PM Liz Truss appointed Jeremy Hunt to the position.

Global financial market developments

  • The major US stock averages dipped and surged Thursday, then setback again Friday.
  • The S&P 500 dropped 2.4% Thursday and then closed up 2.6%, the fifth largest intraday reversal from a low in the history of the S&P 500, and the fourth largest for the Nasdaq.
SPX
  • Friday losses, however, surrendered much of Thursday’s gains.
  • European equity indices were erratic too, closing little changed on the week
  • US 10yr yields were higher again!
10YR yield
  • US Dollar strengthened again, as DXY closed at a new multi-decade peak.
  • GBPUSD consolidated gains since rebound from a record low.
gbpusd
  • Gold plunged reversing the prior week’s rebound from a multi-month low at the end of September, sets up negative
gold
  • Oil has sold off after a surge before and then in the wake of the OPEC+ production cut decision, pointing back towards the multi-month low from the end of September.
Oil
  • Copper is in a consolidation pattern.

Key this week

  • Central Bank Watch: We get the Reserve Bank of Australia (RBA) Meeting Minutes on Tuesday and People’s Bank of China (PBoC) interest rate decision on Thursday.
  • Macroeconomic data: Data is light, main focus will be the release of UK and Canada CPI on Wednesday.
  • Earnings data: Earnings season has kicked in, we get Bank of America, J&J, Netflix, Tesla, and P&G this week.
DateKey Macroeconomic Events
17/10/22China trade data
18/10/22RBA Meeting Minutes; China GDP & Retail Sales; German ZEW
19/10/22UK CPI; Canada CPI
20/10/22Australia Employment report; PBoC interest rate decision
21/10/22Canada Retail Sales

Editor in chief

Steve Miley is the Market Chartist and has 32 years of financial market experience and as a seasoned expert now has many responsibilities. He is the founder, Director and Primary Analyst at The Mar... Continued

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