Market in Review 2/28/2024

MARKET REPORT

Review:
– BTC Surge to $64k record ETF volumes, then Flash-crash/Coinbase exchange users show 0$ Bal
– Mitch Mconnell will step down as Senate Rep leader in Nov
– PCE deflator, sales, PCE and core PCE revised up
– US Q4 GDP revised lower
– Soft Aussie CPI
– Dovish RBNZ hold
– AAPL CEO Cook says it will “break new ground” in generative AI this year
– Berkshire Hathaway increases cash reserves by $60B last 15mnths to $168B (suggesting recession?)
BA Nears 1 Trill Market Cap
– Dimon says AI is not ‘bubble/hype”
– Treasuries up, Dollar/Gold/Crude flat, Equities off small

DOLLAR DX: up small: 103.88      +0.11% (104.17 – 103.80) close off lows
– AUD Down: 64.94                         -0.75% (65.17 – 94.90) close on lows
– EUR UNCH: 92.25                         UNCH (92.59 – 92.18) close off lows
– GBP down small: 126.61             -0.2% (126.24 – 126.73) close off highs
– JPY up small: 150.70                    +0.15% (150.45 – 83) close mid to high

GOLD UNCH:                                   $2042 UNCH ($2033 – $2046) muted, mid to high
DOW/ES/ND:                                    3870 -0.35%, 5072 -0.35%, 17875 -0.8%
CRYPTO: BTC/ETH:                          +3600/+6.3% 60400, +60/+1.85% 3310
CRUDE down small:                        $78.34 -0.7% ($77.84 – $79.55) close off lows

Upcoming:

JAP Retail Sales, Industrial Production, Housing & Construction
AU Retail Sales, Building Exp
FR Inflation rate
DE Inflation rate
CAD GDP
US PCE, Jobless, Chi PMI, Pending Home Sales

Speakers:

Fed: Bositc, Goolsbee, Mester
BoJ: Hajime

Earnings: Beiersdorf, Covestro, Grifols, Merlin, Cellnex, ACS, Leonardo, Prysmian, Saint Gobain, Bath & Body Works, Best Buy, Hewlett Packard.

MAJORS:

DX: 
Dollar saw a slight bid on Wednesday with peaks seen in the morning on downbeat risk tone but DXY failed to hold above 104.00. The Q4 GDP saw a slight revision lower but the PCE metrics were revised up. January PCE on Thursday.
DOLLAR DX: up small: 103.88      +0.11% (104.17 – 103.80) close off lows

No call Pre PCE

1 –

AUD:
Antipodes were the laggards after the dovish RBNZ hold overnight and softer than expected Australian inflation data. Both currencies look to head into the APAC session around session lows despite a slight improvement in the risk tone from the EU morning. AUD fell from a peak of 0.6549 to a close near lows of 0.6490.
AUD Down: 64.94                           -0.75% (65.17 – 94.90) close on lows

No call pre PCE

6-

GBP:
GBP down small: 126.61               -0.2% (126.24 – 126.73) close off highs

No call Pre PCE

12-

EUR
EUR saw mild weakness vs. the Buck with plenty of ECB speak.
Data saw Consumer Confidence unchanged, as expected, and industrial sentiment was slightly worse than unexpected, alongside economic sentiment and services sentiment with the overall business climate unchanged.
ECB saw de Guindos state the inflation outlook has been very positive and if new data confirms their recent assessment, the ECB will modify policy. Kazimir said that he prefers a June rate cut and then a smooth and steady easing cycle. Nagel said it would be a mistake to cut too early only for inflation to reaccelerate.
EUR UNCH: 92.25                            UNCH (92.59 – 92.18) close off lows
No call Pre PCE

9-

YEN:
Yen saw mild weakness despite lower Treasury yields with USD/JPY remaining above 150. Plethora of JAP data out (see above) to determine direction.
JPY up small: 150.70                       +0.15% (150.45 – 83) close mid to high
No call Pre JAP Data

1

GOLD & SILVER:

Another muted session saw the open push from 2035 to 2045 with a very quiet afternoon session seeing the yellow metal close off highs. SI on the open went from $22.50 to $22.70 with a likewise quiet latter session settling at $22.67
GOLD UNCH:                                   $2039 UNCH ($2048 – $2039) close off lows

No call Pre PCE

EQUITIES:
US INDEXES:
– SPX -0.17% 5,069
– NDX -0.54% 17,874
– DJIA -0.06% 38,949
– RUT -0.77% 2,040

EUR INDEXES:
– DAX: +0.25% 17,601.22
– FTSE: -0.76% 7,624.98
– CAC: +0.08% 7,954.39
– ES50: -0.03% 4,884.45

SECTORS (S to W): Communication Services -0.92%, Technology -0.55%, Health -0.51%, Energy -0.18%, Consumer Staples +0.09%, Materials +0.22%, Financials +0.35%, Consumer Discretionary +0.32%, Utilities +0.3%, Industrials +0.3%, Real Estate +1.28%.

STOCKS:
Ebay +8%: Profit, revenue, op. margin and GMV all beat. Authorized an additional 2bln share repurchase program and raised quarterly cash dividend +8% to 0.27/shr.
Beyond Meat +30.5%: Revenue beat, and while adj. EBITDA loss was greater than expected, said it was driven by one-time items.
Novavax -27%: Posted a larger-than-expected loss, missed revenue estimates, and expects 2024 sales to be flat or lower. Believes, given significance of uncertainties, substantial doubt exists about ability to continue as a going concern through 1-year from today.
Boeing +3%: US FAA tells BA it has 90 days to deliver a comprehensive action plan to fix quality control issues. In response, BA stated it will develop a comprehensive action plan that demonstrates “profound improvements” and it has a “clear picture of what needs to be done”.
Apple -0.5%: Apple representatives engaged in a final meeting with the DoJ to dissuade an impending antitrust lawsuit. In other news, CEO Cook said it will “break new ground” in generative AI this year and will share updates on generative AI plans later this year
Amazon -0.5%: Amazon’s lobbyists face a European Parliament ban due to disputes over transparency and labor conditions, FT reports.

OIL
:

WTI (J4) SETTLED USD 0.33 LOWER AT 78.54/BBL; BRENT (K3) SETTLED USD 0.51 LOWER AT 82.15/BBL

The crude complex was choppy on Wednesday, albeit eventually lower amid a resilient Dollar and the continued backdrop of geopolitical tensions. On the day, WTI and Brent reversed initial losses in the EZ morning but as US players entered for the day the complex sold off from highs at the cash open of USD 79.62/bbl and 83.13/bbl, respectively. As such, and after a larger EIA crude build than expected, WTI and Brent gradually fell to US session lows of 78.05/bbl and 81.70/bbl before paring some thereafter into settlement. On geopols, according to Sky News Arabia, the Israeli delegation returned from Doha after two days of negotiations on the detainee deal without progress. Meanwhile, via Al Arabiya, Russia said protecting the population of Transnistria in Moldova is a priority for us after the Russian controlled area requested protection. On Supply, Russia Deputy PM Novak noted the current Russian oil production is around 9.5mln BPD and the proportional decrease of Russian oil and oil products exports in OPEC+ deal is not so important, main thing is the reduction of 500k BPD. Elsewhere, Trans Mountain Corp said it is working to a Q2 service in date for the pipeline expansion. Looking ahead, all attention will be on US Core PCE (Thurs), while globally, European state-level flash CPIs on Thursday and Eurozone flash CPI and Chinese PMIs on Friday. Oil report courtesy of newsquark

BOND YIELDS:
US 1-MO 5.396 -0.006 US 6-MO 5.326 -0.016 US 1-YR 5.012 -0.028 US 5-YR 4.264 -0.058 US 10-YR 4.266 -0.049 US 30-YR 4.406 -0.034
2YR/10YR -0.38

CRYPTO:
“Expect the surge to continue and we see 60k+ handle shortly.
Buy dip, go with move upward.”
Yest Mkt Report.

Huge day for BTC as it surged to 64k (+12.6%!!) to crash to 59K barely an hour later. Huge leveraged short positions were liquidated in the surge up with $175.5 million exited in the last 24hrs for BTC. $363 million across crytpo in all. And in the puke down $85.9 million and $336.4 million respectively.

The surge up is credited to the new ETF’s demand for coins outpacing creation. $6 Billion in demand since Jan 11.

BTC is having its biggest monthly gain since Dec 2020.

Theres an upcoming reduction in BTC’s supply growth, the halving which is fueling the surge, but its mainly FOMO as people are desperate to jump on board, Crypto is driven largely by sentiment.

Coinbase’s App had its customers reporting $0 Balances which added to the mayhem. CEO Brian Armstrong said useage was up 10x which caused customers to be unable to trade.

Etherium followed suite being +7.4% at one stage. Dogecoin also joined the price action.

Last I looked BTC was hovering around the $60.6k, ETH 3335.

No idea short term.

Best of luck out there. Let the market come to you

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