Monday's Markets Update (April 10, 2023)

11 Apr 2023 by rate3

On Monday, the Census Bureau announced that February's total inventories of merchant wholesalers were USD 919.2B, up 0.4 percent from January (expectations were 0.2 with -0.6 previous). The increase was led by automotives, up 1.7 percent, and negatively affected by stocks of farm products, down 3.3 percent. This increase in inventories is a typical signal of a recession as businesses cut back on production to adjust to lower demand. Meanwhile, the NY Fed reported that inflation expectations had increased at the one- and three-year horizons to 4.7 percent (4.2 percent previously) and 2.8 percent, respectively, indicating growing consumer anxiety about the economy's future. No surprises there.

However, the lack of new information did not stop traders from continuing their technically-driven bear rally. This resulted in the NASDAQ increasing by 0.9 percent (opening at 11975 and closing at 12084) and BTC increasing by 3.1 percent (opening at 28277 and closing at 29173). BTC continued to rise by another 3.4 percent in after-hours trading, breaking through the 30K resistance level for the first time since June 2022. The decreasing volumes on all crypto exchanges since the third week of March (allegedly due to SVB collapsing on March 8) show the speculative nature of this run, driven by several big players trying to squeeze out retail short-sellers.