North America News
U.S. Stocks Slide Despite Optimism Over Ukraine Peace Talks
U.S. equity markets dropped on Monday, with major indices giving up early gains as economic data weighed on sentiment.
Intraday market lows:
- Nasdaq: -248.55 points
- S&P 500: -35.30 points
- Dow Jones: -84.35 points
Key developments:
- Axios reported a U.S.-Ukraine minerals deal is near completion, with Treasury Secretary Bessent confirming they are “on the 1-yard line” of finalizing the agreement.
- Putin acknowledged Trump’s diplomatic efforts, saying the U.S. approach aligns more with Ukraine’s survival interests than with Russia’s.
Despite some geopolitical optimism, stocks remained under pressure:
- Dow Jones closed +17 points.
- S&P 500 remained -32 points lower.
- Nasdaq lost -244 points.
Bond yields fell after a strong 2-year Treasury auction:
- 2-year yield: 4.17% (-2.8 bps)
- 5-year yield: 4.232% (-3.7 bps)
- 10-year yield: 4.394% (-3.7 bps)
- 30-year yield: 4.653% (-2.6 bps)
Dallas Fed Manufacturing Index Plunges to -8.3, Lowest Since September 2024
The Dallas Fed manufacturing index dropped sharply to -8.3 in February, a stark reversal from 14.1 last month, signaling a contraction in Texas factory activity.
- Output index declined to -9.1 from 12.2 in January.
- The reading is the lowest since September 2024, when the index stood at -9.0.
Key details:
- New orders: Fell 11 points to -3.5.
- Capacity utilization: Dropped 14 points to -8.7.
- Shipments index: Remained positive but declined to 5.6.
Business sentiment weakened further:
- General business activity index plunged 22 points to -8.3.
- Company outlook index dropped 24 points to -5.2.
- Outlook uncertainty surged to 29.2, the highest level in seven months.
Labor market signals turned negative:
- Employment index hovered near zero (12% hiring, 12% layoffs).
- Hours worked index fell to -14.2, the lowest since mid-2020.
Cost pressures remain elevated:
- Raw materials prices surged 18 points to 35.0, reaching a multi-year high.
- Finished goods prices edged up to 7.8.
- Wages and benefits eased to 16.7 from 20.9.
Looking ahead, sentiment softened:
- Future production index declined to 28.3 from 44.8.
- Future business activity index dropped to 7.7 from 35.5.
JPMorgan’s Dimon: Consumers “Almost Back to Normal,” Calls for Policy Rethink
JPMorgan Chase CEO Jamie Dimon shared insights on the economy, government efficiency, and energy policy in his latest remarks.
- Consumer behavior is normalizing, with spending patterns returning to pre-pandemic levels.
- Deflationary forces are not a concern, as Dimon sees no major risk of declining prices.
- American competitiveness remains strong, despite global economic uncertainties.
On government policy:
- Dimon criticized government inefficiency, calling for major reforms: “It’s not just about the deficit; we need the government we deserve.”
- He warned the U.S. has become overregulated and overly litigious, slowing economic progress.
On energy and security:
- The U.S. needs secure, affordable energy, rather than short-term policy fixes.
- Dimon emphasized the need for a safe and secure Ukraine amid geopolitical tensions.
On JPMorgan’s stock:
- The bank has been reluctant to buy back shares at current valuations.
U.S.-Ukraine Critical Minerals Deal Nears Completion
A U.S.-Ukraine minerals agreement—potentially worth hundreds of billions of dollars—is nearing finalization, according to Axios.
- Ukraine’s stance: Opposes labeling U.S. aid as debt and wants military support included in the deal.
- Financial structure: Ukraine must match U.S. investment 2:1, with 50% of mineral revenue allocated to the Reconstruction Investment Fund.
No U.S. military commitments have been explicitly included in the draft agreement.
Musk Enforces Strict Return-to-Office Policy, Employees Face Administrative Leave
Elon Musk has intensified Tesla’s return-to-office policy, announcing that starting this week, employees who fail to report to work will be placed on administrative leave.
- Staff had received over a month of warnings regarding the return-to-office mandate.
- Musk’s stance underscores a zero-tolerance approach to remote work violations.
Trump’s Tariff Plan Hits COSCO Shipping Stock
- COSCO shares fell 8% after Trump proposed new fees on Chinese-built commercial ships.
- The plan includes mandates for more U.S. goods to be transported on American vessels, impacting global trade dynamics.
Commodities News
Gold Hits Record High at $2,956 as U.S. Dollar Weakens
Gold surged to an all-time high of $2,956 before settling at $2,949 (+0.49%), driven by a weaker U.S. dollar and lower Treasury yields.
Key drivers:
- ETF inflows: Gold-backed ETFs saw their largest net inflows since 2022, boosting demand.
- U.S. economic data in focus: Investors await the Core PCE inflation gauge this week, the Fed’s preferred inflation measure.
- Goldman Sachs raised its 2025 forecast to $3,100 per ounce, citing strong demand.
Despite the record rally, signs of buyer exhaustion are emerging, with traders closely watching for potential profit-taking.
Crude Oil Settles at $70.70 After Hitting Two-Month Low
Crude oil futures edged $0.30 higher to $70.70 per barrel on Monday, after briefly touching a low of $69.80, the weakest level since December 27.
- Intraday high: $70.88
- Key resistance levels:
- 200-hour moving average: $71.48
- 100-hour moving average: $71.65
For oil prices to turn bullish, a sustained move above these technical levels will be necessary.
Cocoa Prices Under Pressure as London Futures Drop 7.6%
London cocoa futures tumbled 7.6% on Friday, settling near GBP 7,300/t, their lowest level since November 2024.
- ING analysts Warren Patterson and Ewa Manthey noted concerns over demand destruction, which could rebalance the market despite continued supply tightness.
- CFTC data shows speculative money managers trimmed wheat net shorts by 21,232 lots while increasing corn net longs by 21,144 lots.
Oil Prices Fall as Speculators Trim Positions, Trump Pressures OPEC+
Oil markets faced sharp selling pressure, with ICE Brent down 2.68% and WTI briefly falling below $70 per barrel for the first time in 2025.
- OPEC+ is considering delaying production increases, currently set for April, which could tighten supply further.
- Trump has called on OPEC+ to raise output, increasing uncertainty around future supply decisions.
Latest positioning data:
- Speculators cut ICE Brent long positions by 23,931 lots, leaving a net long position of 265,223 lots.
Kurdistan Resumes Oil Exports After Two-Year Halt
- Iraq and Kurdistan have agreed to resume crude exports, starting with 185,000 barrels per day.
- Production capacity in the Kurdish region stands at 300,000 barrels per day, with further increases planned.
- Final inspections on the Iraq-Turkey pipeline are underway, with shipments to Turkey’s Ceyhan port expected soon.
Europe News
German DAX Rises 0.6% After Election, Far-Right AfD Gains 20.8%
European markets mostly closed higher:
- DAX: +0.6%
- CAC 40: -0.78%
- FTSE 100: Flat
- IBEX: +0.47%
- FTSE MIB: +0.13%
Germany’s Christian Democratic Union (CDU), led by Friedrich Merz, won 28.5% of the vote in the weekend’s election, positioning him as the next chancellor.
Key takeaways:
- SPD (Chancellor Scholz’s party) collapsed to 16.4%, its worst result since the 19th century.
- AfD (far-right party) surged to 20.8%, reflecting broader nationalist momentum across Europe.
- Merz has vowed not to form a coalition with AfD, despite some policy overlaps on immigration and economic issues.
Germany’s Business Sentiment and Inflation Data Show Mixed Picture
- Ifo business climate index came in below expectations, reflecting ongoing weakness in German industry.
- Final CPI data for January confirmed inflation at 2.5% year-over-year, with core inflation at 2.7%, suggesting underlying price pressures remain.
Swiss National Bank Sight Deposits Increase to CHF 438.1 Billion
Swiss National Bank (SNB) data released on February 24 shows total sight deposits rose to CHF 438.1 billion, up from CHF 432.5 billion in the prior week.
- Domestic deposits also increased to CHF 430.2 billion from CHF 424.4 billion.
This rise suggests ongoing liquidity adjustments in Switzerland’s financial system.
Germany Considers €200B Emergency Defense Spending to Rebuild Military
Germany is exploring a €200 billion ($210B) emergency defense package to bolster military capabilities in response to rising security threats.
- Chancellor-in-waiting Friedrich Merz is negotiating with the Social Democrats (SPD) to bypass constitutional borrowing restrictions.
- Key funding options include:
- Expanding the existing €100 billion defense fund.
- Approving a special military budget that includes Ukraine aid.
- Amending the “debt brake”, allowing additional defense-related borrowing (requires a two-thirds majority).
A March 24 deadline has been set for the vote to pass before the new government takes office.
However, fringe parties hold a blocking minority, which could complicate future votes on military funding.
German Finance Minister: Debt Brake Reform Unlikely in Current Parliament
Germany’s Finance Minister Jörg Kukies has dismissed the idea of reforming the country’s strict debt brake, calling it “unrealistic” given the current political landscape.
- The debt brake limits Germany’s structural deficit and has been a hotly debated topic amid economic stagnation.
- Kukies’ comments indicate that fiscal policy flexibility will remain constrained, barring a political shift.
This reinforces expectations that Germany will maintain fiscal discipline, even as calls for more stimulus persist.
ECB Policymakers Give Mixed Signals on Interest Rates
- ECB Governing Council member Pierre Wunsch warns against “sleepwalking” into too many rate cuts and emphasizes data dependency.
- ECB’s François Villeroy de Galhau suggests that the deposit rate could fall to 2% by summer, assuming inflation trends as expected.
- Spain’s Jose Luis Escriva insists that ECB policy remains meeting-to-meeting, reflecting ongoing uncertainty.
TD Warns of More Bank of England Rate Cuts Than Expected
- TD Securities now expects 125 basis points of BoE rate cuts in 2025, more than the 50bps currently priced in by markets.
- While recent UK economic data has been strong, TD sees May as the earliest timing for a cut, rather than March.
- The British pound may face pressure from both monetary easing and uncertainty over U.S. tariffs under a potential Trump presidency.
Asia-Pacific & World News
Xi Jinping Discusses Ukraine With Putin, Calls for Continued Coordination
- China and Russia reaffirmed their strategic partnership, with Xi Jinping stating that relations will continue to develop regardless of global tensions.
- Beijing supports efforts for a peaceful resolution in Ukraine, but remains committed to its economic ties with Moscow.
China’s No. 1 Central Document for 2025 Focuses on Rural Revitalization
- China’s first major policy release of the year prioritizes rural economic development and food security.
- Key measures include:
- Expanding cold-chain logistics and instant retail services in rural areas.
- Developing AI-driven smart farming and high-tech agriculture.
- Supporting rural housing markets and improving infrastructure investments.
- The plan emphasizes scientific and technological innovation, including AI, big data, and automation to drive growth.
Goldman Sachs Remains Bullish on China’s A-Shares and H-Shares
- Goldman Sachs maintains an overweight rating on Chinese stocks, citing AI-driven growth and strong liquidity support.
- H-shares are expected to continue benefiting from AI advancements, while A-shares could gain momentum in the next three months.
- The A-share premium over H-shares has dropped from 34% to 14% in the past three months, suggesting room for a 10% upside if it returns to last year’s average.
UBS Forecasts AI Stock Volatility but Strong Overall Returns
- UBS predicts mid-teen percentage returns for global AI stocks in 2025, despite expected market volatility due to tariffs and export controls.
- AI sector valuations could reach $10.5 trillion by the end of 2025, up from $9 trillion currently.
- AI operating profits are estimated at $350 billion by 2026, with key firms maintaining high margin profitability in cloud and semiconductor businesses.
- Trade policy uncertainty could trigger volatility, but UBS recommends buying quality AI stocks on market dips.
China’s Property Market: Developers Pay Premiums for Land as Confidence Slowly Returns
- Chinese state-backed developers are resuming land acquisitions at a premium, signaling growing confidence in the sector following government policy shifts.
- So far in 2025, more than a third of land deals have been sold at 20% or more above asking price, up from 14% in 2024 and 4.6% in 2023.
- Major state-owned firms, including China Resources Land, China Overseas Land & Investment, and Poly Developments, participated in seven of the ten largest transactions.
- Despite this renewed activity, overall land sales remain below pre-crisis levels, with most deals focused on smaller parcels.
- Local governments, facing a fiscal squeeze, have eased restrictions to attract buyers, lifting price caps in cities like Beijing, Shanghai, and Hangzhou.
- While home prices and sales remain weak, the latest moves suggest early signs of stabilization in the real estate sector.
PBOC sets USD/ CNY reference rate for today at 7.1717 (vs. estimate at 7.2495)
- PBOC CNY reference rate setting for the trading session ahead.
PBoC injects CNY 292.5bln yuan in open market operations (OMOs)
- via 7-day reverse repos
- rate unchanged at 1.50%
- net injection is 102bn yuan given 190.5bn yuan mature today
New Zealand Q4 Retail Sales Beat Expectations, Up 0.9% q/q
New Zealand’s Q4 retail sales rebounded with a 0.9% quarter-over-quarter (q/q) increase, surpassing market expectations of +0.6% and reversing the -0.1% decline seen in Q3.
Year-over-year (y/y) retail sales also returned to positive territory at +0.2%, a sharp turnaround from -2.5% y/y in Q3.
These stronger-than-expected figures suggest a resilient consumer sector, which could influence the Reserve Bank of New Zealand’s (RBNZ) monetary policy stance moving forward.
Bank of Japan Unconcerned About Gradual Rise in JGB Yields
- BOJ Governor Kazuo Ueda reaffirmed that the central bank will only intervene if bond yields spike abnormally.
- Market forces will determine long-term interest rates, with a high threshold set for emergency bond-buying operations.
- Recent gradual increases in yields reflect market expectations for future rate hikes, but BOJ remains comfortable with current levels.
More here.
Crypto Market Pulse
Binance Coin (BNB) Holds Above $634 as Changpeng Zhao Reveals 99% BNB Holdings
BNB price stabilized above $634 on Monday after falling 6% since the Bybit hack, which triggered bearish sentiment toward centralized exchanges.
- Former Binance CEO Changpeng Zhao (CZ) disclosed that 98.48% of his portfolio is in BNB, with 1.32% in BTC—a move reinforcing long-term confidence in Binance.
- BNB derivative traders remain bullish, deploying $69.7 million in leveraged long positions over the past week.
Why is BNB under pressure?
- The Bybit hack ($1.4B theft) spooked investors, leading to fund outflows from centralized exchanges, including Binance.
- BNB dropped from $679 to $630 as market uncertainty lingered.
Despite this, CZ’s public commitment to BNB has helped stabilize sentiment, easing selling pressure.
Bitcoin Holds Above $95K Despite Historic $1.4B Crypto Hack
Bitcoin remains resilient above $95,000 despite the largest crypto exchange hack in history, which saw $1.4 billion stolen from Bybit by North Korea’s Lazarus Group.
- Crypto market cap (excluding BTC) fell to $1.18 trillion on Monday.
- Solana meme coins saw a 12% market cap wipeout as stolen funds were laundered through Pump.fun.
- Bybit CEO Ben Zhou confirmed full asset backing, ensuring affected users would be fully refunded.
Bitcoin outlook:
- Current price: $95,563, down 0.85% on the day.
- 24-hour trading volume: Over $20 billion.
- Key support: $93,572—a break below could shift BTC into a bearish trend.
Bitcoin dominance rose to 61.50%, delaying the altcoin season, which historically occurs when 75% of the top 50 altcoins outperform BTC over 90 days.
The Altcoin Season Index currently reads 33 (out of 100), confirming that altcoins are underperforming relative to BTC.
Solana Drops Below $160, Faces $26M Liquidation Amid Bearish Pressure
Solana (SOL) extended its decline on Monday, falling below $160 after an 11% drop last week, triggering $26 million in liquidations over the past 24 hours.
- Cumulative liquidations for the past week: $110 million.
- Funding rate (OI-weighted): -0.0023%, indicating that shorts are dominant and paying longs—typically a bearish signal.
- Key support level: $120.91—a break below could deepen losses.
The RSI (Relative Strength Index) reads 31, suggesting strong bearish momentum.
SEC Ends Investigation Into OpenSea, No Legal Action Taken
The SEC has dropped its probe into OpenSea, choosing not to classify NFTs as securities, marking a significant win for the NFT and Web3 community.
- OpenSea’s CEO Devin Finzer welcomed the decision, calling it a victory for creators and the broader NFT ecosystem.
- The SEC had issued a Wells notice in August, warning of potential legal action, but the case is now closed without charges.
This follows a broader shift in the SEC’s stance on crypto enforcement, with Coinbase also seeing its case dismissed last week.
The Day’s Takeaway
Day’s Takeaway: Key Market Trends & Developments
Global Equities Struggle Amid Economic & Geopolitical Uncertainty
- U.S. stocks declined despite renewed optimism over Ukraine peace talks and a U.S.-Ukraine minerals deal nearing completion.
- Nasdaq (-244 points), S&P 500 (-32 points), Dow Jones (+17 points)—a mixed close, with tech stocks underperforming.
- U.S. bond yields fell, with the 2-year Treasury yield dropping to 4.17%, after a strong auction where international buyers snapped up 85% of the issuance.
Gold Hits Record High, ETFs See Biggest Inflows Since 2022
- Gold surged to $2,956, setting an all-time high, before settling at $2,949 (+0.49%).
- Gold-backed ETFs saw the largest net inflows in over two years, reflecting strong demand.
- Goldman Sachs now sees gold reaching $3,100 by the end of 2025.
Crude Oil Remains Under Pressure, Settles at $70.70
- Oil rebounded slightly, settling $0.30 higher at $70.70 after hitting a two-month low of $69.80.
- Technical resistance at $71.48 (200-hour MA) and $71.65 (100-hour MA) must be cleared for a stronger rebound.
Crypto Market Reels from Record $1.4B Hack, Bitcoin Steady Above $95K
- Bybit exchange hacked for $1.4 billion, the largest crypto theft in history.
- Binance Coin (BNB) fell 6% to $634, as investors withdrew funds from centralized exchanges.
- Bitcoin (BTC) held above $95,000, though ETF flows were net negative last week.
- Altcoin season unlikely as BTC dominance rose to 61.50%, delaying broader market rotation.
JPMorgan’s Dimon: U.S. Consumers “Almost Back to Normal”
- Jamie Dimon sees consumer behavior stabilizing, dismissing deflationary concerns.
- Warns of overregulation and bureaucracy hurting U.S. competitiveness.
- Calls for secure, affordable energy and a policy rethink rather than short-term fixes.
- JPMorgan reluctant to repurchase shares at current prices.
Germany Eyes €200B Emergency Defense Spending
- Germany considers bypassing constitutional borrowing limits to approve a €200B ($210B) defense package.
- Goal: Rebuild military strength and increase aid to Ukraine.
- Fringe parties hold a blocking minority, making passage uncertain.
Federal Reserve & Inflation Expectations in Focus
- Fed’s preferred inflation gauge, Core PCE, due this week, could influence interest rate expectations.
- Money markets now pricing in 50 basis points of Fed rate cuts by 2025.
Final Thoughts:
Today’s markets reflected a complex mix of economic resilience and geopolitical risks:
- Gold soared to a record high, while U.S. stocks faltered despite Ukraine peace talk optimism.
- Crypto faced headwinds, with Bybit’s record hack raising security concerns.
- JPMorgan’s Dimon sees the economy normalizing, but Germany’s €200B defense debate underscores rising geopolitical tensions.
- Investors remain cautious as they await key inflation data and Fed policy signals later this week.
