Monday's Markets Update (April 22, 2024)

22 Apr 2024 by rate3

On Monday, stocks started strong as short-term traders stepped in to buy amid technical overselling, bolstered by a perceived geopolitical relief. However, most investors are still on the sidelines, watching key economic data and earnings reports from major companies this week. Globally, gold and the dollar dropped on hints of easing tensions in the Middle East. BTC and ETH followed stocks into the green zone, reaching above 66K and 3.2K, respectively. The rest of the crypto market also performed well, with Avalanche, Monero, and Uniswap increasing by more than 5%.

Details

The Chicago Fed's economic activity index rose to a 5-month high in March (+0.15), exceeding expectations (+0.09). Employment and production indicators increased, while housing and consumption showed slight declines. (ChFed)

Crypto

Hong Kong's securities association is proposing a self-regulatory model for the city's crypto firms. They believe this will improve industry oversight and maintain Hong Kong's competitiveness as a financial center. The proposal involves crypto firms monitoring each other and suggests delegating some licensing power from the regulator to the industry itself. (source)
NYSE is considering a shift to 24/7 trading hours, similar to cryptocurrency markets. This follows a surge in retail investor activity and the popularity of round-the-clock trading platforms.(source)

World Markets

Eurozone consumer confidence held steady at -14.7 in April below expectations of -14.0 but near a two-year high, on hopes of lower interest rates in the future.
China's central bank kept key lending rates steady despite stronger GDP growth and a weakening yuan. This suggests ongoing support for the economy facing headwinds from property and trade, even though recent loan data fell short of expectations. (PBC)
Macau tourist arrivals jumped 39% in March to 2.72 million, nearing to 80% of March 2019 level. Mainland Chinese visitors surged 94%, while Hong Kong and Taiwan also saw increases. International arrivals are still recovering (584Th, 68% of 2019 level). (MO)
Lebanon's inflation rate dropped significantly to 70.4% in March, the lowest in nearly 4 years. This follows a broad slowdown in most categories, including food and housing. Prices are still rising slightly month-to-month, but at a much slower pace.

Currencies

The dollar weakened slightly but remained near a six-month high. Strong economic data and hawkish Fed comments are leading investors to believe the Fed will delay or even avoid interest rate cuts this year. Key economic reports this week will be watched for further clues
The euro held on 1.06, near a five-month low against the dollar. Investors are waiting for economic data to see if the ECB and Fed will cut interest rates as planned. Recent signs of inflation and a strong US economy are making rate cuts less likely.
The British pound fell to a five-month low (1.23) versus the dollar as dovish comments from Bank of England officials dampened expectations of an imminent rate cut.

Commodities

Gold prices plunged over 2% to around $2,330 per ounce on Monday. This drop comes after tensions in the Middle East eased and investors shifted to riskier assets. Additionally, comments from a Fed official dampened hopes of imminent interest rate cuts, reducing the appeal of gold. Investors are now looking ahead to US economic data for clues on future rate decisions.
Oil prices hovered near four-week lows around $82 a barrel on Monday. Investors weighed the uncertain situation in the Middle East against plentiful oil supplies. While Iran downplayed recent attacks, the US imposed new sanctions targeting Iranian oil exports. Additionally, rising inflation concerns and higher US crude stockpiles dampened hopes of an interest rate cut, leading investors to hold off on oil purchases.