Wednesday's Markets Update (April 3, 2024)

03 Apr 2024 by rate3

On Wednesday, stocks edged higher after mixed economic data. The services sector slowed, but job growth remained strong. Tech stocks rose except for Microsoft and Intel, which dropped due to the earthquake in Taiwan. Globally, Eurozone inflation is down to a 2-year low, while gold and oil continued to over-perform amid tense geopolitical disputes. The crypto market's slide paused, with BTC and ETH hovering above major resistance levels at 66K and 3.3K respectively. Meanwhile, some major coins continued to slump, with Bitcoin Cash and Litecoin down more than 8%.

Details

Service sector growth slowed (ISM PMI to 51.4). New orders, inventories, and employment weakened. Prices eased but remain a concern. (ISM)
Private businesses added 184K jobs in March, the most in 8 months. Service sectors like leisure/hospitality led gains. Goods production added jobs in construction and mining, but manufacturing saw little growth. (ADP)

World Markets

Eurozone inflation dipped to a 28-month low of 2.4% in March, missing expectations. Both headline and core inflation rates fell. Energy prices led the decline, while food and goods price growth slowed. Service inflation remained steady. Monthly inflation stayed positive at 0.8%. (Eurostat)
Eurozone unemployment held at a record low 6.5% in February, despite a slight rise in jobless numbers. Youth unemployment remained flat at 14.6%. Spain has the highest rate (11.5%), while Germany enjoys the lowest (3.2%). This is an improvement from 6.6% unemployment a year ago.
Turkey's inflation surged to a 16-month high of 68.5% in March, exceeding forecasts slightly. Transportation and housing costs rose the fastest, while food inflation eased. Core inflation climbed to 75.2%. Despite a slower monthly increase, high prices remain a major concern. (Tuik)

Currencies

The dollar weakened after a surprising slowdown in service sector growth (ISM PMI). This data clashed with other strong economic indicators this week like job growth and factory orders. Investors now await Fed Chair Powell's comments as hopes for a June rate cut hover around 59%.

Commodities

Oil prices hit a 5-month high above $86 per barrel after OPEC+ extended production cuts. Supply concerns due to attacks on Russian facilities, Middle East tensions, and a focus on output reduction by key members like Iraq pushed prices higher.
Gold surged to record highs above $2,280 per ounce. Rising tensions in the Middle East and Ukraine fueled demand for safe havens. Mixed signals on Fed policy exist, with some expecting 3 rate cuts this year. Investors await Friday's US jobs report and Fed comments for clues on interest rates.