Market in Review 4/2/2024

MARKET REPORT

Review:

– POWELL:
– Reiterates likely appropriate to begin lowering IR ‘at some point this year”
– inflation figures though higher than expected didn’t ‘materially change’ the overall picture
– policy makers will wait for signs of lower inflation before cutting

– ISM Services PMI hits 3-month Low Act 51.4 vs Exp 52.7

– Bostic expects rate cuts to start Q4, Holzman open to June cut

– US Private Employment beats Expectations Act 184k vs Exp 148K
– US Services Activity Slows Act 51.7 vs Prev 52.3
– US Private Sector Activity Act 52.1 vs Exp 52.2

– ECB CPI Act 2.4% vs Exp 2.6%

– Swiss Franc weakens to 5-month Low

– Oil climbs to 5-month High

– 10yr Treasury Yield hits 4-month High

– US Dollar retreats from 4-month High

– Copper hits 12-month High

– SI +3.5% Outperforms GC, although GC above the $2300 handle

– Taiwan eathquake

– Gold up, Dollar down, Equities mixed, Crypto flat, Crude flat.

DOLLAR DX Down: 104.02            -0.5% (104.58 – 103.97) Off Lows
– AUD UP: 65.62                               +068% (65.04 – 65.70) Off Highs
– EUR DOWN: 92.27                        -0.57% (92.88 – 92.27) Lows
– GBP UP: 126.50                             +0.58% (125.68 – 126.55) Highs
– JPY up: 151.69                               +0.1% (151.54 – 151.95) Mid

GOLD UP: $2318                              +1.62% (2287 – 2319) HIGHS
DOW/ES/ND flat to up small:       39506 UNCH, 5270 +0.2%, 18391 +0.3%
CRYPTO UNCH: BTC/ETH:              -271/-0.4% 65654, +18/+0.5% 3298
CRUDE UP: $85.61                          +0.55%/+$0.47 ($84.86 – 86.14) Mid

Upcoming:

AU Building Permits, Retail Sales Final

EUR: PPI, Monetary Policy meeting accounts (minutes)

BoE Decision Making Panel

US: Weekly jobless, Bal of Trade

Speakers:

RBA Jones

US Mester, Barker, Goolsbee, Musalem, Kaskari

Earnings:

MAJORS:

DX:  
Majority of the weakness in wake of the ISM Services PMI which missed expectations and fell from the prior – prices eased from February but still remaining in expansionary territory. DXY fell from peaks in the European morning at 104.84 to lows of 104.23 heading into APAC trade. Fed Chair Powell also spoke where he repeated his recent commentary noting risks are becoming more balanced.

DOLLAR DX Down: 104.02            -0.5% (104.58 – 103.97) Off Lows

No call

AUD:
Nothing to report, see above.

AUD UP: 65.62                                 +068% (65.04 – 65.70) Off Highs

No call

GBP
Global inflationary pressures appeared to be easing, leading to speculation of potential interest rate cuts by central banks. Recent data showed a decrease in the Euro Area’s annual inflation rate to 2.4% in March from 2.6% the previous month, contrary to forecasts of stability. The US services ISM PMI also reported a marked decline to a four-year low in business input prices, signaling a positive outlook for inflation.

GBP UP: 126.50                +0.58% (125.68 – 126.55) Highs

No call

EUR
Markets digested a batch of fresh economic data for hints on the extent of ECB rate cuts this year. March’s CPI print showed that the Eurozone’s inflation dropped to 2.4%, below the market consensus of 2.6%, while the core rate eased more than expected to 2.9%, marking its lowest level since February 2022. The disinflation trend aligned with ECB policymaker Robert Holzmann’s recent remarks, stating that lower price growth could make a June rate cut appropriate.

EUR DOWN: 92.27                          -0.57% (92.88 – 92.27) Lows

No call

YEN:
Nothing specific to report.

JPY up: 151.69                                 +0.1% (151.54 – 151.95) Mid

No call

GOLD & SILVER:
Gold keeps on setting new records with Silver the frontrunner up over 3% today.
I had a pause at 2375, got that wrong. Getting bubble-ish but who knows when itll pop. Not I it appears.

GOLD UP: $2318                              +1.62% (2287 – 2319) HIGHS

No call.

EQUITIES:
US INDEXES:
–  SPX +0.11% 5,211
– NDX +0.21% 18,160
– DJIA -0.11% 39,127
– RUT +0.54% 2,076

EUR INDEXES:
–  DAX: +0.50% 18,374
– FTSE 100: +0.03% 7,937
– CAC 40: +0.29% 8,153
– Euro Stoxx 50: +0.29% 5,068

SECTORS (S to W): Communication Services +0.71%, Energy +0.66%, Materials +0.63%, Industrials +0.51%, Consumer Discretionary +0.22%, Technology +0.11%, Real Estate +0.06%, Financials -0.08%, Health -0.1%, Utilities -0.42%, Consumer Staples -1.1%.

STOCKS
– Intel -8%: Foundry losses have widened, and the unit may not reach a break-even point for several years. Said its foundry business had USD 7bln in operating losses for 2023 vs. USD 5.2bln the year before.
– Paramount Global +17%: Co. and Skydance are in advanced discussions for a potential deal, NYT reports. WSJ reported the board has agreed to enter exclusive discussions, and they favour it over a recent USD 26bln all-cash offer from a PE firm.
– Retailers (FIVE, COST, DLTR, LOW) are lower after Gordon Haskett downgraded the four names after the recent rally.
– Disney -3%: CEO Iger wins proxy vote over Peltz with board’s election; all 12 nominees re-elected to board.

OIL:
WTI (K4) SETTLED USD 0.28 HIGHER AT 85.43/BBL; BRENT (M4) SETTLED USD 0.43 HIGHER AT 89.35/BBL

The crude complex was firmer on Wednesday, albeit settling off best levels, after continued geopolitics, alongside OPEC JMMC and the weekly EIA data. The OPEC JMMC was a non-event with no policy recommendations made and with compliance reaffirmed, as expected. Geopolitics continue to underpin the complex with US and Israel at odds over the Rafah operations whilst Ukraine targets Russian energy infrastructure. On the weekly EIA data, crude stocks saw a surprise build, against the larger-than-expected draw in the private inventory data on Tuesday night. Gasoline and Distillates both saw larger than forecasted draws, in fitting with the APIs, while production was unchanged at 13.1mln. In terms of levels, WTI and Brent hit highs of USD 86.20/bbl and 89.99/bbl, respectively, against the troughs in the European morning of USD 84.85/bbl and 88.67/bbl. Looking ahead, for crude specifically, any Middle East updates remain of importance, while on the macro footing the Fed speaker deluge continues ahead of NFP on Friday.

CRUDE UP: $85.61                          +0.55%/+$0.47 ($84.86 – 86.14) Mid

BOND YIELDS:
US 1-MO D/UNA
US 6-MO D/UNA
US 1-YR D/UNA
US 5-YR D/UNA
US 10-YR D/UNA 046
US 30-YR D/UNA

2YR/10YR D/UNA

CRYPTO
– ARK CEO Cathie Wood says currency devaluations are behind BTC rise
– Nigeria (-60%), Egypt(-40%) & Argentina
– Has target Price of $1.5m
– Crypto Exchange Bitget’s Wallet team joins Meme Coin hype, Issues token that rises 14,000%
– Motley fool survey has 43% of respondents planning on buying crypto this year
– Quant Momentum Trade is hot again in Crypto

CRYPTO UNCH: BTC/ETH:             -271/-0.4% 65654, +18/+0.5% 3298

KEEP DOING WHATS WORKING
STOP WHAT ISNT.

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

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