North American News
Major US stock indices close mixed on the day
- Dow higher. S&P near unchanged. Nasdaq modestly lower
The US stocks opened higher, went even higher, but then gave up all/most of the gains into the close. The S&P and Dow did close higher for the 3rd day in a row. The Nasdaq 2-day win streak was snapped.
The final numbers are showing:
- Dow Industrial Average was 40.45 points or 0.12% at 33431.43
- S&P index rose 2.78 points or 0.07% at 4048.43
- NASDAQ index fell -13.26 points or -0.11% at 11675.75
The Russell 2000 was not so lucky as it fell -28.50 points or -1.48% at 1899.75.
US yields gave up earlier declines and closed marginally higher on the day help to weaken the stocks:
- 2 year yield 4.888%, +2.7 basis points
- 5 year yield 4.259% +0.7 basis points
- 10 year yield 3.973% +1.0 basis points
- 30 year yield 3.907% +2.0 basis points
US January factory orders -1.6% vs -1.8% expected
- January 2023 US factory order data and revisions to durable goods
- Prior was +1.8% (revised to +1.7%)
- Factory orders ex transportation +1.2% versus +0.7% prior
- Shipments +0.7%
Revisions to durable goods orders
- January durable goods -4.5% versus a -4.5% preliminary. Prior month +5.6%
- durable goods ex transportation +0.8% versus +0.7% preliminary
- Durable goods non-defense capital goods ex-air +0.8% versus +0.8% preliminary
Commodities
Gold falls below $1850
- Gold price stumbles 0.37% on Monday.
- US Factory Orders dropped less than estimates though market players ignored it.
- Traders are eyeing the appearance of the US Federal Reserve Chair Jerome Powell at the US Congress.
- Gold Price Analysis: Downward biased in the near term.
Gold price slides 0.26% or $3.00 a troy ounce in the North American session. The US economic calendar ahead of next week’s Tuesday inflation figures would be busy, led by Fed speakers and employment data. At the time of typing, the XAU/USD exchanges hands at $1850.57 after hitting a daily high of $1858.33.
WTI crude oil rises to $80 despite slower China growth forecasts
- China aims for growth of around 5%
China forecast growth of ‘around 5%’ this year.
The bulls were hoping for something around 6% and talk of stimulus but instead the forecasts and commentary were more conservative. WTI fell as low as $78.32 but as rebounded to $80.15 per barrel. This is the first rise above $80 since February 13.
On the fundamental side, tomorrow’s API private oil data will be a driver, along with whatever Fed Chairman Jerome Powell says. Oil has benefited from positive risk appetite in the past two trading days and that will remain a main driver going forward, though I’d anticipate that if global growth continues to impress, then there’s more upside for crude coming than risk assets.
Technically though, we’re still in the $70-85 range and until that breaks, it’s a range trade. In the short-term, the February high of $80.62 is nearby.
EU News
European equity close: A good start to the week
- The 2023 gains continue
Buying European stocks has been the trade of the year so far in 2023 and that continued to start the week:
- Stoxx 600 +0.3%
- German DAX +0.5%
- French CAC +0.3%
- UK FTSE 100 -0.2%
- Italy MIB +0.4%
- Spain IBEX +0.5%
Eurozone Retail Sales decline 2.3% YoY in February vs. 1.9% expected
- Eurozone Retail Sales came in at 0.3% MoM in February vs. 1.0% expected.
- Retail Sales in the bloc arrived at -2.3% YoY in February vs. 1.9% expected.
Eurozone’s Retail Sales rose by 0.3% MoM in February versus 1.0% expected and -1.6% last, the official figures released by Eurostat showed on Monday.
On an annualized basis, the bloc’s Retail Sales came in at -2.3% in February versus -2.8% seen in January and 1.9% consensus forecast.
Other News
We could get the text of Powell’s opening remarks to congress later today
- Testimony is often released early
Jerome Powell is set to appear in his semi-annual Humphrey Hawkins appearances on Tuesday and Wednesday, starting with the Senate. However the text of the comments are often released the evening before the appearance, which would be today sometime after the equity market close.
If so, watch for his comments to mirror the weekend speech from the Fed’s Daly who said:
- Further policy tightening, maintained for a longer term, will likely be necessary
- I am beginning to think the labor market has a shortage of workers
- Anecdotes from business leaders suggest inflation is slowing more than recent data suggests
Fed’s Daly put a heavy emphasis on upcoming data before the March 22 FOMC, which will include non-farm payrolls this Friday and CPI numbers March 14. The problem is the Fed’s blackout period begins at midnight on Friday so it will be tough for policymakers to communicate how those numbers changed the state of play.
Cryptocurrency News
SEC takes emergency action against $100-million fraud scheme operator BKCoin
- The US Securities and Exchange Commission has been on a crypto crackdown streak.
- BKCoin was alleged to have raised $100 million from 55 investors but defrauded them by using the funds for personal expenses.
- Earlier last month, the SEC also sued Terraform Labs and its founder Do Kwon for multi-billion-dollar fraud.
The Securities and Exchange Commission (SEC) has been tailing the crypto market keenly for the last few years. As a result, enforcement actions every now and then have emerged, with the previous three years noting a significant increase in the same. The SEC took another such action this week.
SEC takes down BKCoin
In a press release on Monday, the regulatory body announced the filing of an emergency action against BKCoin Management LLC. The Miami-based investment advisory company, along with its co-founder Kevin Kang, have been alleged to committed fraud against 55 of its investors. According to the SEC, BKCoin raised nearly $100 million from these investors to invest in crypto assets and generate returns.
However, the founder Kang and the company are being accused by the SEC of using those funds to make Ponzi-like payments and for personal ends.
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