North American News
US equity close: S&P 500 virtually erases the year-to-date gains
- Back to where we started
US equities were hit hard today and the S&P 500 virtually erased its gains for the year in the second day of selling. Stocks tried to rally early on a higher US unemployment rate but worries about banks led to heavy selling in the latter half of the day as Silicon Valley Bank was taken over by the FDIC.
There was a big divergence in US indexes as the Russell 2000 was clobbered by heavy exposure to regional banks:
Daily changes:
- S&P 500 -1.45%
- Nasdaq Comp -1.7%
- DJIA -1.1%
- Russell 2000 -3.0%
Weekly changes:
- S&P 500 -4.5%
- Nasdaq Comp -4.7%
- DJIA -4.4%
- Russell 2000 -8.1%
US February non-farm payrolls +311K vs +205K expected
- February 2023 US employment data from the non-farm payrolls report
- Prior was +517K (revised to 504K)
- Two-month net revision -34K
- Unemployment rate 3.6% vs 3.4% expected
- Prior unemployment rate 3.4% *
- Participation rate % vs 62.4% prior (was 63.4% pre-pandemic)
- U6 underemployment rate % vs 6.6% prior
- Average hourly earnings +0.2% m/m vs +0.3% expected (prior +0.3%)
- Average hourly earnings +4.6% y/y vs +4.7% expected (prior +4.4%)
- Average weekly hours 34.5 vs 34.6 expected
- Change in private payrolls 265K vs +210K expected
- Change in manufacturing payrolls -4K vs +12K expected
- Household survey +177K
- Birth-death adjustment added 176K jobs
Odds of a 50 basis point Fed hike fall after non-farm payrolls
- Odds of 25 bps rise to 66% from 50% before the data and 30% earlier in the week
The headline from the non-farm payrolls report was high at +311K compared to +205K expected but details of the report, including the unemployment rate and wage growth were below expectations. That’s led to a small relief rally in equities with S&P 500 futures up 14 points, or 0.4%.
Commodities
Gold jumps on NFP disappointments and bulls eye test of $1,850
- Gold price rallies on the knee-jerk after Nonfarm Payrolls.
- Gold price bulls eye a break of $1,850 to take back control.
Gold price had been moving higher for a third consecutive day on Friday but the yellow metal was on track for a weekly fall as prospects of further interest rate hikes dented the precious metal’s allure, while traders awaited a US Nonfarm Payrolls report.
WTI crude oil futures settle at $76.68
- Up $0.96 or 1.27%
The price of WTI crude futures are settling at $76.68. That’s up $0.96 or +1.27%
The low today reach $74.77. The high extended to $77.11. The lower dollar/lower rates help to send the price back to the upside. Other commodities also gained with gold up $36 or 1.99%. Silver was up $0.42 or 2.13%.
EU News
European equity close: DAX touched a one-year high this week the closed
- Closing changes on the day and the week
On the day:
- Stoxx 600 -1.5%
- FTSE 100 -1.8%
- German DAX -1.5%
- French CAC -1.6%
- Italy MIB -1.5%
- Spain IBEX -1.6%
On the week:
- Stoxx 600 -2.3%
- FTSE 100 -2.6%
- German DAX -0.9%
- French CAC -1.7%
- Italy MIB -2.1%
- Spain IBEX -1.9%
European banks took a big hit today and dragged down the indexes
Other News
FDIC takes control of Silicon Valley Bank
- Regulators close down Silicon Valley Bank
Silicon Valley Bank was closed today by the California Dept of Financial Protection and Innovation, which appointed the FDIC as receiver.
The FDIC will pay uninsired depositors an advance dividend within the next week and a receivership certificate for the remainder of uninsured funds. The FDIC said the bank had $175.4B in deposits in the bank.
That is why you get your money above $250K out of a bank that’s in trouble and it’s why bank runs happen.
China February M2 money supply +12.9% vs +12.5% y/y expected
- Latest Chinese credit data for February 2023 has been released
- Prior +12.6%
- New yuan loans ¥1.8 trillion vs ¥1.5 trillion expected
- Prior ¥4.9 trillion
Cryptocurrency News
Cronos price likely to set a new 2023 low as CRO bulls disappear
- Cronos price sees bulls absent as price action goes nowhere.
- CRO could sell off further by 13% as volatility and crypto woes increase by the day.
- At the current pace, Cronos could hit a new low for 2023 at the start of next week.
Cronos (CRO) sees traders becoming a nervous wreck this week as the pace at which negative news is hitting crypto traders is almost incomprehensible. As if the Silvergate Capital collapse was not enough, another commercial bank in the US is on the brink of default as markets are going into risk-off mode with the US equities again firmly in the red these past few days. The number of dark clouds and tail risks at hand is unbearable for bulls to stay in their long positions, which means that CRO will tank at least another 13% toward $0.0550
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