Friday's Markets Update (October 4, 2024)

05 Oct 2024 by rate3

On Friday, equities closed higher following a surprisingly strong jobs report. This reinforces Powell's view that the economy is in 'solid condition,' suggesting that the Fed is not in a hurry to cut interest rates. Internationally, silver reached a 12-year high amid geopolitical concerns and China's stimulus. BTC (62K) and ETH (2.4K) started to correct slightly upward on technicals after a week's long crash.

Details

Economy added 254K jobs in September - the strongest job growth in 6 months, exceeding forecasts. Employment continued to trend up in food services, health care, government, social assistance, and construction. 1Y trend: "Down" (BLS)
The unemployment rate fell to 4.1% in September, the lowest in three months, from 4.2% in August. 1Y trend: "Down" (BLS)

Crypto

Binance report warns of inflated valuations and centralized token ownership risks in the cryptocurrency market. These issues could jeopardize the market's long-term stability. Decentralized control and transparency are crucial for trust and sustained growth. (source)

World Markets

The HCOB Eurozone Construction PMI rose to 42.1 in September, up from a six-month low of 41.4. The reading still indicated a significant slump in total construction activity across the euro area, as new orders continued to decline sharply. 1Y trend: "Down" (PMI)
The Supply Chain Pressure Index in World decreased to 0.13 points in September from 0.20 points in August of 2024 (average = 0.00 in 1997 - 2024; ATH 4.39 in Dec 2021; ATL -1.56 in May 2023). 1Y trend: "Side" (NYFed)

Currencies

The dollar index surged 0.5% on Friday, its highest since mid-August, following a stronger-than-expected jobs report that reduced the likelihood of a large interest-rate cut by the Federal Reserve next month. 1Y trend: "Side"

Commodities

Silver prices rose to $32.1 per ounce in October, the highest in 12 years. Concerns of more aggressive warfare in the Middle East supported safer assets. Additionally, silver also received support from the announcements of aggressive fiscal and monetary stimulus measures to support the world’s second-largest economy. The rise was in line with support for industrial metals, lifting the outlook of silver-intensive manufacturing processes. 1Y trend: "Up"
The FAO Food Price Index increased 3% to 124.4 in September, the highest level since July 2023. Sugar prices soared 10.4%, driven by concerns over tighter global availabilities. Vegetable oils jumped 4.6%, dairy cost went up 3.8%, cereals rose 3%, and meat cost edged up 0.4%. 1Y trend: "Side"

On Week 41, investors will focus on CPI, FOMC Minutes, and earnings season. Fed officials will give speeches, and data on producer prices, Michigan consumer sentiment, and foreign trade will be released.