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

US inflation still running hot, BUT hints at stock averages basing


Macroeconomic/ geopolitical developments

  • US CPI headline data year over year rose 8.3%, falling from March’s pace but not as much as expected, with consensus around 8.1%.
US April 2022 CPI
  • Jerome Powell again stated that a hike of 0.75% was not something being actively considered, but was still a possibility.
  • Possible easing of pandemic lockdowns in Shanghai, China brought some cheers to Chinese and Asian stocks, slightly easing global supply chain and inflation worries.

Global financial market developments

  • Six consecutive down weeks for the S&P 500 Index and the Nasdaq Composite and seven for the Dow Jones Industrial Average, its longest losing stretch since 2001!
  • But rebound efforts from the latter part of the week have hinted at basing patterns.
  • Global stock averages were also initially lower last week, although European and UK indices did rebound and are still outperforming their US counterparts.
  • US 10yr yields broke back below the psychosocial 3% barrier as US and global bonds move to lower yields.
  • US Dollar strength has extended as the greenback stays strong across the board.
  • Gold sold off further with USD gains, staying more bearish.
  • Oil moved higher again, reinforcing a positive range environment.
  • Copper pushed still lower for a still more negative tone, but a bounce does hint at a base.

Key this week

  • Geopolitical focus: Still closely monitoring the war in Ukraine
  • Central Bank Watch: A light week for Central Banks, we get the Reserve Bank of Australia (RBA) Meeting Minutes on Tuesday and Jerome Powell also speaks Tuesday, then the People’s Bank of China (PBoC) interest rate decision on Friday.  
  • Macroeconomic data: A light week for data, with the US Retail Sales data and UK Employment reports the standouts on Tuesday.
DateKey Macroeconomic Events
16/05/22China Retail Sales  
17/05/22RBA Meeting Minutes; UK Employment report; EU GDP; US Retail Sales; Jerome Powell speaks
18/05/22UK CPI; Canada CPI
19/05/22Australian Employment report
20/05/22PBoC interest rate decision

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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