Wednesday's Markets Update (May 15, 2024)

15 May 2024 by rate3

On Wednesday, stocks went up on a low core inflation surprise, supported by the sharp drop in retail sales. The S&P and Nasdaq hit new ATH, tech stocks led the gains. Globally, silver reached 10-years high on weaker dollar. BTC reacted jowly on stocks rise jumping up 6% while other coins followed with Solana, Polkadot and Avalanche adding more than 7%.

Details

Core inflation, excluding food and energy, fell to a 3-year low of 3.6% in April, down from 3.8% previously. Housing costs remain high but are rising slightly slower. Overall inflation is moderating, matching forecasts. CPI rose to a new high of 3.4% in April (313.55, averaged 123.74 points 1950 - 2024, ATH 313.55 in Apr 2024, ATL 23.50 in Feb 1950), below expectations. This follows a slightly higher increase in March. (BLS)
Retail sales unexpectedly stalled in April after a weak March. This indicates a slowdown in consumer spending, with some categories like clothing showing growth but others like furniture dropping. Core retail sales, rose slightly. (Census)
Manufacturing in New York contracted further in May (Empire State Index -15.6). New orders and employment continued to fall, but businesses are cautiously optimistic about a future rebound. (NYFed)

Crypto

El Salvador mined nearly 474 Bitcoin worth $29 million using geothermal energy from the Tecapa volcano since 2021, boosting its national crypto holdings to over $354 million. (source)

World Markets

The Eurozone bounced back in Q1 2024, growing 0.3% after a period of stagnation. This is the strongest quarter since late 2022, with key economies like Germany and France showing improvement. The outlook is positive with inflation easing and growth expected near 0.8% for the year, fueled by consumer spending and trade. However, investment growth might slow down. (EU)
India's trade gap widened to $19.1B in April, exceeding expectations and reversing March's improvement. Imports surged 10.3% year-over-year despite a weaker rupee, driven by expensive gold, oil, and electronics. Exports grew at a slower pace (1.1%), with some gains in electronics and chemicals. (IN)
Peru's economic growth came to a halt in March, dropping 0.28% compared to last year. This follows two months of gains. Construction and several service sectors led the decline, while agriculture and hospitality continued to grow. Mining slowed but remained positive.
Inflation in Nigeria keeps rising, hitting a 28-year high of 33.69% in April. This is due to a weaker naira and subsidy removals. Food prices surged the most, but housing, utilities, and transportation also climbed. Even core inflation (excluding volatile items) hit a record high. While the monthly price increase slowed slightly, inflation remains a major challenge. (Nig)

Currencies

The dollar index fell to a five-week low on renewed Fed cuts hopes, again :)
The Euro strengthened to a five-week high on expectations of central banks in both the US and Europe cutting rates.

Commodities

Silver prices surged to 10-years-highs above $29 due to weaker-than-expected inflation data. Slower price increases and stalling consumer spending raise hopes for a Fed rate cut in September.