Tuesday's Markets Update (March 26, 2024)

26 Mar 2024 by rate3

On Tuesday, stocks were in the red as investors awaited inflation data and Fed clues. Durable goods orders surprised on the upside, but consumer confidence missed, and regional manufacturing activity continued to slow down. The financial and consumer discretionary sectors led, while utilities and energy lagged. Tesla and Reddit rose on news. In the world's markets, the yen weakened despite Japanese government support, the Brazilian real is cheaper due to export concerns, and the Swiss franc fell against the USD due to its central bank's rate easing move. BTC and ETH stumbled, meeting resistance at 70K and 3.6K, respectively, increasing the chances of forming medium-term side-channels on their price charts.

Details

Home prices rose faster than expected in January (6.6% YoY), with San Diego and Los Angeles leading the gains. However, prices dipped slightly month-over-month due to rising mortgage rates. Only Southern California and Washington D.C. saw price increases in January. (SP)
Factory orders for durable goods rose 1.4% in February, exceeding expectations. This follows a January decline. Orders for transportation equipment (cars, machinery) bounced back significantly. Business spending plans also showed a modest increase. (Census)
Richmond manufacturing index fell to -11 in March, signaling a slowdown. New orders and backlogs dropped sharply. Despite this, employment remained stable and wage growth continued. Businesses are still somewhat optimistic, but less so than last month.(RichFed)
A Texas service sector business survey showed a decline in March(index -5.5). Companies' outlooks remained flat, but uncertainty rose. Revenue growth slowed, and employment was steady. Price pressures eased, but future activity expectations stayed positive. (DallasFed)

Crypto

The London Stock Exchange will start trading Bitcoin and Ethereum ETNs in late May, pending regulatory approval. This move aims to bring cryptocurrencies to the traditional stock market. (source)

World Markets

German consumer confidence rose insignificantly to -27.4 in April, the highest level of 2024. Income and economic outlook improved modestly. However, willingness to buy remains very low, and saving is still high. Experts say a sustained economic recovery hinges on lower inflation and clearer government plans. (GFK)
Spain's economic growth slowed in 2023. The final quarter came in at 2.0%, following a similar increase in the previous quarter. This brings the full year growth to 2.5%, down significantly from 2022's 5.8% expansion. (INE)

Currencies

The weak yen prompted warnings from Japanese officials. Finance Minister Suzuki didn't rule out intervention, and currency diplomat Kanda called the decline "speculative." This follows the Bank of Japan's recent rate hike, which had little impact on the currency.
The Swiss Franc weakened to a 5-month low. The Swiss central bank cut rates rate by 25bps to 1.5% and lowered inflation forecasts (also to 1.5%), while the US Fed held rates due to high inflation. This policy contrast caused the Franc to depreciate.
The Brazilian real weakened (to 4.98) due to lower inflation and a weak export outlook. Lower inflation data increased expectations of a dovish stance by the central bank, potentially slowing future rate cuts. Concerns about slowing demand for iron ore and soybeans in China, key Brazilian exports, also weighed on the real.