Friday's Markets Update (October 11, 2024)

11 Oct 2024 by rate3

On Friday, equities rallied, driven by strong bank earnings and a positive economic outlook. Meanwhile, producers' (PPI) inflation remained unchanged as consumer price index (CPI) rose, creating uncertainty about Fed rate cuts. The dollar reached a 2-month high as Indian industrial production declined for the first time since 2022. Crypto traders followed stocks, with BTC jumping to 64K but ETH remaining around 2.4K.

Details

The University of Michigan consumer sentiment dropped to 68.9 in October, lower than expectations, with current conditions and expectations both weakening. Inflation expectations rose slightly for the year ahead but eased for the five-year outlook. 1Y trend: "Up" (SCA)
Factory gate prices (PPI) held steady in September, below expectations, while service prices rose. Annual producer price inflation eased to 1.8%, with core inflation increasing to 2.8%, exceeding forecasts. 1Y trend: "Down" (BLS)

Crypto

Liberland, a micronation seeking recognition between Croatia and Serbia, operates under a unique on-chain governance system. Newly appointed Prime Minister Justin Sun aims to establish it as the "freest nation," boosting interest and causing the Liberland Dollar to surge over 200%. (source)

World Markets

India's industrial production fell by 0.1% YoY in August 2024, marking its first decline since October 2022, primarily due to a 4.3% drop in mining and a 3.7% reduction in electricity output. 1Y trend: "Side" (MOSPI)
The Bank of Korea cut its base rate to 3.25%, the first time in nearly two years, due to easing inflation and weakening economic output. Inflation is projected below 2% this year, with GDP growth expected at 2.4% in 2024. 1Y trend: "Side" (BoK)

Currencies

The Euro weakened to 2-month low (around $1.09), influenced by dollar strength and expectations of slow Fed rate cuts. The ECB is anticipated to lower rates further, while Eurozone inflation fell to 1.8%, the lowest since April 2021. 1Y trend: "Up"
The dollar index approached 103, its highest in nearly two months, amid economic data suggesting persistent inflation. Producer prices stagnated, but core inflation exceeded expectations, prompting Atlanta Fed President Bostic to consider maintaining rates in November. 1Y trend: "Side"

Commodities

Gold rose above $2,640 per ounce as traders reacted to mixed economic data, suggesting the Fed may slow rate cuts. Jobless claims raised concerns about the labor market, while producer inflation data is anticipated for further insights. 1Y trend: "Up"

On Week 42, focus will be on the retail sales report, Fed speeches, and earnings season. In Europe, the ECB's interest rate decision and Germany's ZEW Economic Sentiment index are key. The UK will release unemployment rate, inflation figures, and retail sales. China will reveal its Q3 GDP growth rate and other data. Inflation data will also be released for India, Canada, New Zealand, Japan, and South Africa.