Friday's Markets Update (June 28, 2024)

28 Jun 2024 by rate3

On Friday, stocks closed down even though inflation data hinted at a rate cut, as tech (Amazon -2.3%) fell. Despite the daily drop, June was a strong month with the S&P up ~3% and the Nasdaq up ~4%. In global markets, the Brazilian real weakened due to disagreements between Lula and the country's Central Bank over a 10.5% interest rate. BTC plunged below $61K regardless of the pro-Bitcoin candidate crushing his opponent in the first presidential debate.

Details

PCE inflation rate dipped to 2.6% in May, matching expectations. This is down slightly from the previous two months and below the long-term average. (BEA)

Crypto

Bolivia lifted its crypto ban, potentially opening a $10 million monthly market. While exciting, it creates regulatory hurdles for businesses and users. However, this move could spark wider crypto adoption in Latin America, a region seeking financial alternatives due to economic woes. (source)

World Markets

Germany's unemployment rate hit a 3-year high of 6% in June, exceeding expectations and marking the 18th straight month of joblessness climbing. This rise reflects a sluggish German economy. 1Y trend: "Up" (Gstat)
Spain's inflation eased slightly to 3.4% in June, below forecasts. This dip is mainly due to falling fuel prices, with some moderation in food price increases. However, recreation costs rose more than last year. Core inflation remained steady at 3%. 1Y trend: "Up" (INE)

Currencies

Brazil's currency weakened (past 5.56 BRL/USD) due to political tension between President Lula and BCB’s President Campos Neto over a 10.5% interest rate. Despite a strong job market (unemployment at lowest since 2015), concerns about government spending and inflation are hurting the real. 1Y trend: "Up"

On Week 27, key events include jobs data, Fed minutes, and PMI readings globally. European elections in France and the UK will be watched closely. Inflation updates and industrial data from major economies like Germany are also on tap.