Monday's Markets Update (January 27, 2025)

27 Jan 2025 by rate3

On Monday, equities dropped as tech stocks, including Nvidia and Broadcom, fell sharply amid fears of competition from DeepSeek. Regional indexes reflecting the level of business and manufacturing activities rose, reinforcing expectations that the Fed will hold rates steady on Wednesday. The dollar increased in response to Trump's threats to impose tariffs on Colombia. Chinese manufacturing activity slumped to a 6-month low ahead of the Lunar New Year festival. BTC, ETH, and SOL tumbled by 2-3%, following the stocks.

Details

Building Permits decreased by -0.70% MoM in December 2024, following a 5.20% increase in November. This marks a decline from the historical average of +0.22% (1960-2024; ATH = +33.9% (Jan 1967); ATL: -24% (Feb 1990)). 1Y trend: "Up" (Census)
The Chicago Fed National Activity Index increased to 0.15 in December 2024, the highest in seven months. Production and employment indicators contributed positively to the index. Sales, orders, inventories, and personal consumption and housing categories contributed negatively. The three-month moving average also increased. 1Y trend: "Down". (CFed)
The Dallas Fed's Texas manufacturing activity index rose significantly in January, reaching a 4-year high. New orders, capacity utilization, and shipments improved. Business conditions were strong, with employment growing slightly. Price pressures increased, while future manufacturing expectations were very positive. 1Y trend: "Up".(DFed)

Crypto

A crypto project supported by Donald Trump, World Liberty Financial, purchased $10M worth of ETH during a market dip, acquiring 3,247 ETH. This follows a $47M ETH buy on Trump’s inauguration day, bringing its total ETH holdings to 59,265. (source)

World Markets

China’s NBS Composite PMI fell to 50.1 in January, the lowest since August, missing forecasts of 52.0. Manufacturing shrank, and services slowed amid Trump's tariff threats. Beijing may introduce support measures, but risks of overcapacity and deflation persist. 1Y trend: "Side". (NBS)

Currencies

The dollar index rose above 107.7, rebounding from last week’s losses as Trump’s tariffs on Colombia reignited trade concerns. The Fed is expected to hold rates this week, but pressure for cuts persists. Traders await the PCE inflation report. 1Y trend: "Up"