Friday's Markets Update (March 1, 2024)

02 Mar 2024 by rate3

On Friday, the main indices hit new record highs as tech stocks rallied. Factory activity contracted more than expected, and inflation data eased concerns. The S&P 500 and Nasdaq had positive weeks, while the Dow lagged. In the world markets, Euro stocks reached all-time highs due to low inflation, a slowing economy, and increased employment. Gold reached ATH, while oil rose again due to geopolitics and OPEC cuts. The crypto market is on the rise, with Cardano (+7%), Algorand (+6%), and Bitcoin Cash (+5%) leading the way. ETH edged above 3.4K, while BTC is slowly recovering from a profit-taking event, reaching 62.5K.

Details

The US ISM Manufacturing PMI fell to 47.8 in February, below expectations, indicating 16 consecutive months of declining manufacturing activity. New orders and production levels also contracted, while prices rose at a slower pace. Employment levels declined for the fifth straight month. (PMI)
In February, the Global Manufacturing PMI rose to 52.2, marking the fastest sector expansion since July 2022. Output and new orders surged, export orders grew for the first time in three months, and job creation hit a five-month peak. However, business confidence dipped from a 21-month high. (SP) Comment: such a mess in data :)
UBI News: Tacoma, Washington, launches GRIT 2.0, a guaranteed income project offering 175 families $500 monthly for a year. Eligible families must earn between 100% and 200% of the Federal Poverty Line.(source)
The University of Michigan Consumer sentiment was revised lower in February, with expectations and current conditions subindexes both dropping. Inflation expectations for the year ahead increased slightly, while the five-year outlook remained the same. (UM)

Crypto

Nigeria fined Binance $10B, accusing it of causing a 70% depreciation of the Naira through speculative exchange rate manipulations, reports BBC. (source)

World Markets

European equities ended the week positively, with the Stoxx 50 reaching a 23-year high and the Stoxx 600 hitting a record high. Disinflation in the Eurozone and lower Treasury yields supported the market, with gains seen in tech shares and banks. Daimler Truck exceeded earnings expectations.
In February, the HCOB Eurozone Manufacturing PMI was revised to 46.5, indicating a slight improvement but still showing a contraction in the sector. Germany's decline was notable, while Spain grew and Greece and Ireland saw significant expansions. Employment fell, and prices dropped, but business confidence remained stable. (SP)
In February, Euro Area inflation decreased to 2.6% YoY, slightly above expectations and above the ECB's 2% target. Energy prices fell less sharply, and while the pace of increase in other categories slowed, the core inflation rate also declined (to 3.1%) but remained above forecasts. Monthly, consumer prices rose by 0.6%. (EuroStat)
In January, the Euro Area unemployment rate dropped to a record low of 6.4%, with the number of unemployed decreasing to 11.009 million. Youth unemployment remained steady at 14.5%. Spain had the highest unemployment rate at 11.6%, while Germany boasted the lowest at 3.1%. (EuroStat)

Currencies

The dollar index fell below 104 as poor economic data and central bank officials' remarks weighed on sentiment. Fed officials had differing views on rate cuts and inflation concerns.

Commodities

Gold reached a record high of over $2,080 per ounce, driven by a weak dollar and lower Treasury yields, as US economic data showed a decline in manufacturing and weak consumer surveys. US inflation for January was the lowest in three years. New York Fed President expects an interest rate cut later this year.
WTI crude futures reached $80 per barrel, the highest in four months, due to speculation of extended supply cuts by OPEC+ and tensions in the Middle East. Uncertainty around ceasefire talks and increased US crude stocks influenced prices. Weekly oil prices are up over 5%.

On Week 10 investors will monitor the labor report, speeches by Fed officials, and key indicators like the ISM Services PMI. Internationally, the focus will be on central bank decisions, inflation rates, GDP growth rates, trade data, and services PMIs in various countries.

Comment: We Are Diverging.

The news today, in one corner, we have Nigerian bureaucrats pointing fingers at cryptocurrency for their blunders. Blaming the Binance for their own economic mess.

Meanwhile, a city in Texas is taking a bold step towards Universal Basic Income (UBI), something crypto enthusiasts have been advocating for years. This is a small step forward towards a decentralized governance system, just like many of us have been preaching.

This news perfectly highlights the divide in our world. It is an unending battle between generations. The older folks just can't seem to let go of the reins and are desperate to control us, even if it means crippling progress.

So, crypto brothers and sisters, hold onto your coins tight. In this uncertain world, they might just be your lifeline to freedom.