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

“Risk On” Theme Intact as Fed Seen Slowing Pace of Hikes

Beginner

Macroeconomic/ geopolitical developments

  • Wednesday saw the Minutes released from the Fed’s early November meeting, highlighting a “substantial majority of participants” look to slowing the pace of rate hikes, though the rates may end up higher than previously anticipated.
Federal Reserve
  • S&P Global’s flash composite new order index for the US fell to its lowest level in more than two years.
  • Chinese stocks were positive for the week despite new coronavirus restrictions, as authorities signaled more supportive measures to stimulate the economy.

Global financial market developments

  • Another solid, high-level consolidation for the week by the major US stock averages after the earlier November surge in the wake of the US CPI release.
  • European equity indices were solid last week, rising fir a sixth straight week, Asian averages were also higher.
  • US 10yr yields pushed lower towards recent, multi-week yield lows.
  • The 2yr-10yr curve segment of the US Treasury yield curve inverted even further (historically, a typical indicator of a recession) to its most inverted level in over 40 years
  • The US Dollar pushed lower close to multi-month lows, unable to recover since the November plunge, that saw DXY post its worst day since during the 2009 Great Financial Crisis.
  • Gold dipped and bounced staying solid after the earlier November surge from a multi-month low to a multi-week high.
  • Oil prices dropped further for a still more negative.
  • Copper staged a modest bounce after the prior weekly plunge reversed much of the previous weekly surge.

Key this week

  • Central Bank Watch: No significant Central Bank activity, though we do get Fed Chairman Powell speaking on Wednesday.
Fed Chairman Powell
  • Macroeconomic data: A busy data week, we get global PMI data from S&P Global and US ISM PMI, the US GDP, PCE and Employment reports, plus German and EU CPI.
DateKey Macroeconomic Events
28/11/22Australian Retail Sales
29/11/22German CPI; Canadian GDP
30/11/22Australian CPI; German Employment report; EU CPI; ADP Employment change; US GDP and PCE; Fed Chairman Powell speaks
01/12/22German Retail Sales; global PMI data from S&P Global and US ISM PMI; US PCE
02/12/22US and Canadian Employment reports

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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