Friday's Markets Update (May 31, 2024)

01 Jun 2024 by rate3

On Friday, stocks were uncertain, with the S&P gaining slightly. The Dow surged on a rebound in Salesforce. Investors focused on lower PCE inflation. For the week, most indexes were down slightly. On global markets, according to the latest GDP reports, India became the world’s fastest-growing major economy (+7.8%). BTC and ETH are barely changed, with the crypto market on pause among mixed news.

Details

After rising in March, PCE inflation rate slowed to 2.7% in April, as expected by analysts. This is still within the historical average of 3.3% for the PCE price index since 1960. 1Y trend: “Down” (BEA)
Chicago PMI plunged to 35.4 in May, the steepest decline since May 2020 lows. This suggests a stagflation as a reaction to the Fed’s unreasonably tight monetary policy. 1Y trend: “Down” (ISM)
Crypto

A KPMG report states that the prevailing sentiment among digital asset stakeholders is that different digital money forms will exist alongside each other, not replace each other. Users will choose the most efficient option, creating a diverse digital currency landscape in the coming decade. (source)
World Markets

Eurozone inflation rose to 2.6% in May, firs time in 5 months, exceeding forecasts. Energy prices rose and core inflation climbed. Inflation also accelerated in several major European economies. 1Y trend: “Down” (EC)
China’s manufacturing sector contracted in May for the first time since February. The official PMI fell below expectations to 49.5, with new orders and foreign sales shrinking. Despite some signs of stabilization in delivery times and employment, rising input costs and weaker business confidence point to ongoing challenges. 1Y trend: “Side” (CN)
India’s economy surged past expectations, growing at a robust 7.8% in the last quarter, solidifying its position as the world’s fastest growing major economy. This strong performance was driven by a significant jump in manufacturing, construction, and services sectors. Though inflated by taxes, the overall growth for the financial year reached an impressive 8.2%. 1Y trend: “Side” (Mospi)
Turkey’s economy grew at a faster pace in Q1 2024 (5.7%) compared to Q4 2023 (4%). Construction, manufacturing, and information & communication led the growth across sectors. Household spending also jumped, while exports rose and imports fell. The economy gained momentum on both yearly and quarterly bases. 1Y trend: “Side” (TR)
On Week 23, jobs data is key, while interest rates and inflation are in focus for Europe, India, and several emerging economies. Also investors will be watching manufacturing and services data for China, Europe, and others, alongside trade figures for major countries. Germany sees factory orders, production, and unemployment reports.