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

Global Stocks Gain and Yields Fall Through Key CPI as US Earnings Kicks Off


Macroeconomic/ geopolitical developments

  • The focus last week was on the US Consumer Price Index (CPI) data, which posted at 6.5% YoY for December, in line with market expectations, though the monthly reading was negative, falling by 0.1%. Average prices fell for US consumers in December compared to the prior month, which  has not occurred since May 2020 and was better than analyst’s expectations for a reading 0.0%. Core CPI data (excluding food and energy prices) posted in line with consensus estimates.
  • Earnings season for Q1 kicked off in the US in earnest with the financial sector, as Wells Fargo, JPMorgan Chase and Bank of America beat consensus expectations Friday, and despite cautious outlooks from these banks, they dipped and rallied Friday.
Earnings season
  • UK Gross Domestic Product (GDP) grew 0.1% in November, beating forecasts that were for a contraction of 0.2% contraction, raising expectations that a recession could be avoided.
  • In Japan, core CPI data in the Tokyo area rose 4.0% YoY in December, the fastest rate in 40 years!

Global financial market developments

  • The major US, European and Asian stock averages were positive last week, to continue the solid start 2023.
  • US and European bond yields fell further
  • The US Dollar Index plunged across the Forex board, to new multi-month lows.
  • Gold surged to another new multi-month high.
  • Oil prices posted a strong rebound, to reverse the plunge seen in early 2023 back close to the late 2022 low, easing bigger negative pressures.
  • Copper surged out of a broader range phase to a new multi-month high.

Key this week

  • Geopolitical Events: The US Martin Luther King Holiday is on Monday 16th January with US equity and bonds cash markets are closed. 
MLK day
  • Central Bank Watch: The Bank of Japan interest rate decision is on Wednesday and the PBoC interest rate decision is on Friday
  • Macroeconomic data: Focus this week will be on the UK Employment report, German, Canadian and UK CPI, US Retail Sales.
  • Earnings data: Q1 earnings season continues in the US with the focus on Morgan Stanley, Goldman Sachs, P&G and Netflix.
DateKey Macroeconomic Events
16/01/23US Martin Luther King Holiday, equity and bonds cash markets are closed
17/01/23China GDP, Industrial Production and Retail Sales, UK Employment report, German CPI, German ZEW Survey, Canada CPI
18/01/23UK inflation report (CPI); EU CPI; US PPI and Retail Sales
19/01/23Australian Employment report 
20/01/23PBoC interest rate decision; UK Retail Sales; Canada 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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