A glimpse into the world of markets and economy through Nasdaq’s IR team lens.
“Party like it’s 1995: Dovish central banks are enhancing the growth/policy balance. Mid-cycle rate cuts in the face of relentless economic activity create a favorable environment for risk assets.”
-Barclays’ Emmanuel Cau
| “Markets have dialed back the expected number of Fed rate cuts this year by -4.7bps to 80bps. The probability of a June cut has declined to 79%, from nearly 86% at its recent peak last week.
…expectations for ECB cuts by December have decreased by -6.1bps to 88bps.”
-Deutsche Bank’s Jim Reid
* source: Barclays’ Emmanuel Cau
* source: Goldman Sachs Global Investment Research
* source: BofA’s Michael Hartnett, The Flow Show
| “With the Fed eager to cut rates, ECB/BoE compelled to do the same, and a spree of rate cuts worldwide, except for the BoJ increment, with 55 central bank rate reductions over the past six months; we seem to be in the era of the ‘everything bull.'”
-BofA’s Michael Hartnett
* source: BofA’s Michael Hartnett, The Flow Show
| DB investor survey suggests lingering inflation risk while investors display heightened optimism toward the economy…
* source: Deutsche Bank
| The 10YR yield steadfastly hovers above 4% | equities’ reactivity to interest rates is reaching historic levels
* source: CNBC
* source: Michael Kantrowitz, Piper Sandler
| “In the history of market corrections, with 27 instances of significant downturns since 1964, one common factor prevailed: 1) soaring rates; 2) escalating unemployment rates; or 3) a global (exogenous) issue.
Today, the primary threat to the ongoing rally in stocks appears to be the surge in rates.”
-Michael Kantrowitz, Piper Sandler
* source: Michael Kantrowitz, Piper Sandler
| The Hot & Cold Economy: The economic leading index registers its first monthly upswing in two years
* source: John Stoltzfus, Oppenheimer Asset Management
| elevated valuations + a divided market
* source: Goldman Sachs Global Investment Research
1) KEY TAKEAWAYS
1) Equities + Gold RISE | Dollar + Oil FALL | TYields VARY
-Both headline and core durable goods surpass expectations, interrupting two consecutive months of decline
DJ +0.1% S&P500 +0.2% Nasdaq +0.4% R2K +0.5%
Stoxx Europe 600 +0.1% APAC stocks MIXED, 10YR TYield = 4.261%
Dollar DOWN, Gold $2,181, WTI -0%, $82; Brent -0%, $86, Bitcoin $70,756
2) THIS WEEK:
light macro calendar
* source: Barclays’ Emmanuel Cau
2) MARKETS, MACRO, CORPORATE NEWS
- China’s manufacturing boost poses a risk of higher US inflation, as per NY Fed –BBG
- Analysis-Bank of Japan’s dovishness may be underrated by markets–RTRS
- Traders anticipate BOE to initiate rate cuts sooner than the Fed or ECB –BBG
- US braces for a potential market upheaval akin to Liz Truss’s shock as debt levels surge, cautions watchdog-FT
- Hedge funds shift focus to Europe, abandoning US equities–RTRS
- Employment levels in 16 US states still lag behind pre-pandemic figures–BBG
- German consumer sentiment on a gradual recovery trajectory, notes GfK-RTRS
- Australian consumer sentiment dulls once more in March – survey-RTRS
- S.Korean consumer sentiment wanes as food inflation emerges as a prime election topic–RTRS
- US CEOs extend their stay in China after a sudden invite to meet Xi Jinping–BBG
- China expected to implement further RRR reductions this year to stimulate the economy-BBG
- PBOC bolsters yuan support via the highest fix increment since January-BBG
- China pushes banks to hasten approvals for new loans to private developers-RTRS
- Bloomberg/Morning Consult poll in swing states suggests a potential Biden resurgence–AXIOS
- Meng Foon stands firm as a PGG Wrightson director–DESK
- A key bridge in Baltimore crumbles after being hit by a cargo ship-NYT
- Carlyle ponders a $1 billion IPO for Indian IT firm Hexaware-BBG
- Beige potentially selling up to 2.90% stake in Mankind Pharma through block deals–CNBC
- Boeing contemplates an external CEO hire to address the escalating crisis-RTRS
- Hershey, Mondelez betting heavily on Easter amid concerns of a cocoa price crisis-RTRS
- Tesla offers a month-long trial of its driver-assist technology to US customers-RTRS
- Trump’s Truth Social to commence trading as DJT-AXIOS
Oil and Energy Headlines: 1) Summer gas prices on track to hit $4 per gallon just as Americans plan road trips-BBG 2) US oil production projected to reach a record high as costs decrease, notes Macquarie-BBG 3) Russia’s crude shipments rebound despite tanker sanctions-BBG 4) Indian buyers ceasing Venezuelan oil imports due to apprehensions over sanctions-BBG 5) Indian refiners upping US crude purchases amidst tightening Russia sanctions-RTRS 6) Risks loom over Russian and Chinese vessels despite Houthi agreement-BBG
