North American News
US stocks rebound off the lows, The NASDAQ closes higher on the day
- S&P and Dow lower but things could have been worse
The major US stock indices experienced a rebound after trading sharply lower intraday. While both the S&P and Dow Industrial Average still closed lower for the day, the final numbers show that things could have been worse. The NASDAQ index was the top performer, rising 5.91 points after initially declining by -189.71 points at session lows.
- The Dow Industrial Average fell by -279.18 points or -0.87% to close at 31875.62. At its session lows, the Dow had fallen by -725.59 points and never traded in positive territory, remaining down by -248.94 points at the day’s lows.
- Similarly, the S&P index closed down by -27.27 points or -0.70% at 3892.00. At its session lows, the index was down by -81.06 points and tested the closing level from the end of 2022 at 3839.85. The low price for the day reached just below that level at 3838.24 before starting the rebound.
- The NASDAQ index rose 5.91 points or 0.05% at 11434.06. At session lows the NASDAQ was down -189.71 points
- The Russell 2000 fell by -30.94 points or -1.74% to close at 1745.94. The low price for the day reached -60.22 points before recovering half of those declines.
In the US debt market yields are lower but off their low levels for the day:
- 2 year 3.924%, -30 basis points. The low yield today reached a 3.72%
- 5 year 3.569%, -22 basis points. The low yield today reached 3.433%.
- 10 year 3.473%, -16.2 basis points. The low yield reached a 3.388%.
- 30 year 3.664%, -9.5 basis points. The low yield reached 3.603%
US February retail sales -0.4% vs -0.3% expected
- US February 2023 retail sales data
Details:
- Ex autos -0.1% vs -0.1% expected
- Prior ex autos +2.3%
- Control group +0.5% vs -0.3% expected
- Prior control group +1.7%(revised to +2.3%)
- Ex autos and gas 0.0% vs +2.6% prior
- Gasoline stations -0.6% vs +5.7% m/m prior
- Electronics and appliance stores +0.3% vs +3.5% m/m prior
- Furniture stores -2.5% vs +4.4% m/m prior
- Restaurants -2.2% vs +7.2% m/m prior
US February PPI final demand 4.6% YoY versus 5.4% YoY expected
- US February 2023 producer price data
- Prior PPI 6.0% (was expodus4ecting 5.4%) revised it to 5.7%
- PPI MoM -0.1% versus 0.3% expected (0.7% prior revised to 0.3% – was expecting at the time 0.4%))
- PPI Ex food energy YoY 4.4% vs 5.2% expected (prior 5.4%)
- PPI Ex food and energy MoM 0.0% vs 0.4% expected (prior 0.5% revised to 0.1% – was expecting 0.1%)
- PPI free-trade -0.8%
- transportation and warehousing down -1.1%
Atlanta Fed GDPNow rises to 3.2% from 2.6% last
- The 1Q estimate for growth rises.
In their own words:
The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the first quarter of 2023 is 3.2 percent on March 15, up from 2.6 percent on March 8. After recent releases from the US Department of the Treasury’s Bureau of the Fiscal Service, the US Bureau of Labor Statistics, and the US Census Bureau, the nowcasts of first-quarter real gross personal consumption expenditures growth, first-quarter real gross private domestic investment growth, and first-quarter real government spending growth increased from 4.4 percent, -6.8 percent, and 1.5 percent, respectively, to 5.0 percent, -6.4 percent, and 1.8 percent.
Fitch downgrades First Republic to BB. Places ratings on negative watch
- First Republic shares are down -16.98% today
Fitch has downgraded First Republic to BB, a junk rating, and placed the ratings on negative watch. Shares of the regional bank (FRC) have declined by $6.73 or 16.98%, currently trading at $32.95. On Monday, the stock hit a low of $17.53 before rebounding to a high of $50.97 yesterday. As recently as March 3rd, the price reached $123.70, and on February 2nd, it traded as high as $147.68. The stock’s peak in 2021 was $222.86.
Goldman Sachs lowers 2023 GDP growth forecast to 1.2%
- Was at 1.5%
Goldman Sachs is lowering its 2023 GDP growth forecast for the year to 1.2%. That is down 0.3% from 1.5% previously. The decline is in part reflecting a larger downgrade to investment spending.
US March NAHB housing market index 44 vs 40 expected
- US home builder sentiment data
- Prior was 42
- Current sales 49 vs 46 prior
- Prospective buyers 31 vs 29 prior
- Next six months 47 vs 48 prior
Commodities
Gold to soar toward $1,973/98 on a weekly close above $1,890/1900 – Credit Suisse
Gold has found a floor as expected above its 200-Day Moving Average (DMA), currently seen at $1,775. A weekly close above $1,890/1900 is needed to clear the way for a retest of $1,973/90, strategists at Credit Suisse report.
55-DMA at $1,869 now holds to keep XAU/USD within its range
“A solid weekly close above $1,890/1900 is needed to clear the way for a retest of $1,973/98. Beyond here stays seen needed to reassert an upward bias for a test of long-term resistance from the $2,070/72 record highs of 2020 and 2022.”
“Ideally, the 55-DMA, currently seen at $1,869 now holds to keep the precious metal within its range. Nevertheless, if this would break, we could see further weakness toward the recent range low at $1,804, before the crucial 200-DMA, currently seen at $1,775, which we would once more expect to provide a floor.”
Crude oil continues to tumble lower
- Prices down $4.90 or -6.86% to $66.47
WTI crude oil futures are approaching the swing low from December 20, 2021, which stands at $66.12. Today’s low has reached $66.40, following a decline below the 2022 low price of $70.08. The price is currently trading down -$4.90, or -6.86%, at $66.47.
EIA weekly crude stocks build 1.550M versus 1.188M estimate
- Weekly oil inventory data from the EIA
- Crude oil build 1.555M versus 1.188M estimate
- gasoline sees a drawdown of -2.061M versus estimate of -1.820M
- distillates see a draw of -2.537M versus estimates of a draw of -1.172M
- Cushing stocks show a draw of -1.916 million versus previous -0.89 million
- refinery utilization 2.200% versus expected 0.3%. Prior +0.2%
- weekly crew production 12.2 million barrels versus 12.2 million last week
EU News
European indices close sharply lower as banking concerns weigh on equities
- Major indices close 3% – 4% lower
Major European indices are closing sharply lower.
- German DAX:-3.28%. That equaled the decline going back to December 15, 2022
- France’s CAC: -3.58%. That’s the largest decline going back to March 4, 2022
- UK’s FTSE 100: -3.83%. That’s the largest decline since February 24, 2022
- Spain’s Ibex: -4.23%. Largest decline since November 26, 2021
Former ECB vice-president says they should hike ‘at most’ 25 bps tomorrow
- Comments from Vitor Constancio
Vitor Constancio is no longer at the ECB but he was recently his comments likely offerssome insight into how central bankers think about the current situation.
“Central Banks should not ignore the signs from the markets and the more likely recession forthcoming. They should tone down their hiking campaign. The ECB should do at most 25 bps and not the announced 50 pbs. The Fed should also do only 25bps next [week],” he writes.
Other News
Credit Suisse CEO: We are a strong bank and overshoot all regulatory requirements
- That’s not the kind of thing you want to have to announce
- Our liquidity base is strong
- The material weakness cited in our report refers to financial reporting controls; has no impact on financial results
- Situation in the US is not comparable and factually has nothing to do with Credit Suisse
Shares of Credit Suisse are down 28% today and the market cap is down to 6.3 billion. CDS have spiked. It’s not a pretty picture.
Swiss govt faces pressure from ‘at least one major govt’ to intervene on Credit Suiise
- Report from Reuters
Governments do not want to deal with a banking crisis that spreads globally so naturally they want Switzerland to put an end to questions about Credit Suisse before it hits counterparties.
Sen. Warren: Should re-examine 250,000 limit on deposit insurance
- Sen. Warren on banking issues
- Powell’s actions directly contributed to bank failure
- Need to put tougher constraints on midsize banks back in place
- Banks under $50 billion would not be subject to new regulation
- Should re-examine 250,000 limit on deposit insurance
- Need similar deposit insurance for small businesses or nonprofits
Cryptocurrency News
Uniswap price sinks by 8% despite DEX’s launch on Binance BNB Chain
- Uniswap price corrects lower following the 15% rise in price over the last four days.
- Uniswap launches on the BNB Chain, ensuing support from 55 million UNI holders.
- The deployment will enable Uniswap users to leverage BNB’s lower transaction as opposed to the current option of Ethereum
Uniswap, the world’s biggest decentralized exchange (DEX), launched its version 3 (V3) on the BNB Chain on Wednesday. BNB Chain, developed by the world’s biggest cryptocurrency exchange Binance, is also the second biggest Decentralised Finance (DeFi) chain right after Ethereum. However, the impact the launch was expected to bear on Uniswap price did not materialize, given other forces in play in the crypto market at the moment.
Uniswap comes to Binance BNB Chain
Uniswap V3 launched on BNB Chain following overt support from the community. The proposal, which was submitted in February, was met with a positive response and received approval from the majority of over 55 million UNI token holders. The proposal was initiated by 0x Plasma Labs following Uniswap’s attempt at extending its reach.
Being built on Ethereum, Uniswap users have long faced problems arising due to the L1’s high fees. To eradicate this issue, Uniswap decided to expand to other DeFi chains bringing it to BNB Chain. With this deployment, the DeFi protocol’s users will be able to leverage the low transaction fees that come with Binance’s BNB Chain to trade and swap tokens.
At the moment, Binance’s DeFi chain supports nearly 555 protocols, which combined have over $5.02 billion locked in them. The total value locked (TVL) on Uniswap across all its versions, on the other hand, is a little under $3.5 billion.
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