Thursday's Markets Update (July 11, 2024)

11 Jul 2024 by rate3

On Thursday, stocks were in deep red with Nasdaq and S&P crashing in a classic WS move of 'selling the news' on an unexpected drop in the core inflation rate, which factually supports mounting public voices, including senatorial ones, for the Fed's urgent rate cut. With that, the Dow surged as traders favored traditional stocks over tech, as concerns rose about tech earnings. In world markets, gold jumped, nearing an ATH as the dollar weakened, following increasingly dovish statements from Powell and growing disarray in the DEM's presidential campaign. BTC and ETH were stopped short in their post-Germany-dump recovery by the abrupt selloffs on the Street.

Details

Core inflation, excluding fluctuating items like food and energy, dipped to a 3-year low of 3.3% in June, below expectations. While housing costs remain high, price increases for other categories are slowing down. Monthly core inflation also hit a multi-year low, suggesting inflation might be cooling down. (BLS)

Crypto

Prediction market traders now estimate a 65% chance that Biden will drop out of the presidential race, up from 59% yesterday. This follows his first press conference in months and concerns about his age and cognitive health. His chances of becoming the Democratic nominee have also fallen to 38%, while his chances of winning the presidency have dropped to 10%. (source)

World Markets

Brazil's retail sales jumped 8.1% in May, exceeding forecasts and reversing a slowdown in April. 1Y trend: "Up" (Ibge)

Commodities

Gold prices surged past $2,410 per ounce, reaching a new high, as US economic data showed inflation slowing to a one-year low and labor market softening. This strengthened expectations for the Federal Reserve to cut interest rates, with 85% of investors betting on a June cut. The trend is consistent with other major central banks, making gold a more attractive asset. 1Y trend: "Up"