North American News
US equities ring up a strong day
- Closing changes
Closing changes for the main North American equity indexes:
- S&P 500 +1.4%
- Nasdaq+1.8%
- Russell 2000 +1.1%
- DJIA +1.0%
US sells 7-year notes at 3.626% vs 3.615% WI
- Results of the $35 billion auction
- Prior was 4.062%
US February pending home sales +0.8% vs -2.3% expected
- US February 2023 pending home sales numbers
- Prior was +8.1%
- Index 83.2 vs 82.5 prior
Fed’s Barr: We will make a meeting-by-meeting judgement on interest rates
- Comments from Fed bank supervision chair Barr
- We will be looking at incoming data and financial conditions to make a meeting-by-meeting judgement on interest rates
- Monetary policy decisions were well-telegraphed
- We need stronger rules on capital and liquidity for banks of $100B and up
- It’s fair to ask if the supervisors of SVB could have been more aggressive
Commodities
Silver hovers around $23.30s, unable to break $23.50
- Silver price is trading sideways after hitting a daily high of $23.39.
- XAG/USD Price Analysis: Short term, the XAG/USD might test $24.00 once it reclaims $23.50: otherwise, it would consolidate.
Silver price consolidates for the fourth straight day after hitting a weekly high of $23.52. However, the white metal faces solid resistance and trades sideways on Wednesday. At the time of typing, the XAG/USD is trading at $23.32 for a gain of 0.40%.
XAG/USD Price action
On Wednesday, the XAG/USD failed to sustain the early break above March’s 28 high of $23.37, which would open the door to test the week’s low at $22.83 once sellers break the $23.00 psychological level. That would open the door for a leg down, and if the XAG/USD tumbles below the former, that could exacerbate a test of the 20-day Exponential Moving Average (EMA) at $22.32.
On the flip side, with Silver’s buyers cracking $23.50, upside risks would lie at $24.00, followed by a test of the YTD high at $24.63.
In the short term, the XAG/USD 4-hour chart portrays the white metal as neutral to upward bias, and it might test $23.50 soon. A breach of the latter will clear the path to test higher pivot points, like #2 at $23.70, before assaulting R3 at $24.04.
US weekly EIA crude oil inventories -7489K vs +92K expected
- Weekly US petroleum inventory data from the EIA
- Prior was +1117K
- Gasoline -2904K vs -1617K expected
- Distillates +281K vs -1617K expected
- Refinery utilization +1.7% vs +0.6% expected
- Cushing -1632K
API data released late yesterday showed:
- Crude -6076K
- Gasoline -5891K
- Distillates +548K
EU News
European equity close: Green wave as the banking worries are scrubbed
- Closing changes for the main European bourses
Closing changes in Europe:
- Stoxx 600 +1.2%
- German DAX+1.1%
- UK FTSE 100 +1.0%
- French CAC +1.4%
- Italy MIB +1.4%
- Spain IBEX +1.3%
ECB’s Schnabel says labour costs possibly indicate 2nd round inflationary effects
ECB board member Isabel Schnabel is speaking in the US, in a panel discussion at 39th Annual National Association for Business Economics’ (NABE) Economic Policy Conference, “Orienting Policy for a Polarized World”, in Washington, D.C.
Other News
BOE’s Mann: It’s going to be tough for the BOE to do its job in H2
- Mann warns on difficulties of headline vs core
BOE policymaker Mann is warning on how inflation dynamics will make the job of central banking difficult in H2. She highlights a dynamic where headline inflation will be falling while core remains stubbornly high.
That will put pressure on central banks to cut but they will be want to be sure inflation is squashed before they do.
BOC’s Gravelle: Ready to act in the case of severe market-wide stress
Bank of Canada (BOC) Deputy Governor Toni Gravelle said on Wednesday that the BOC is ready to act in the case of severe market-wide stress and provide liquidity support to the financial system, as reported by Reuters.
Additional takeaways
“Quantitative tightening program will likely end sometime around the end of 2024 or first half of 2025; QT is working but will take some time to run its course.”
“If faced with extreme event that caused severe dysfunction in government of Canada (GoC) bond market, bank could resort to large-scale GoC bond purchases.”
“Bar is very high for bank to use large-scale GoC bond purchases to support market functioning again.”
“Bank would only be offering extraordinary liquidity in extreme market-wide situations, when entire financial system faced funding constraints.”
“Penalty pricing should be built into extraordinary actions whenever possible to make program unattractive once financial conditions improve.”
“If bank were faced with a UK-style pension fund crisis, it could use its contingent term repo facility; this would reduce need for bank to conduct outright bond purchases.”
“This level is well below current level of roughly C$200 bln; our best estimate is somewhere in the range of C$20 bln to C$60 bln.”
“Canadian banks are not immune to spillover from events elsewhere, which can negatively affect things here.”
Cryptocurrency News
Shiba Inu could rise 15% by the end of the week
- Shiba Inu price has resumed its growth path, rising over 3% in the day with aspirations for more gains.
- SHIB could soar almost 15% to tag the $0.00001200 resistance level by the end of the week.
- The bullish narrative will be invalidated if the meme coin records a candlestick close under $0.00001010.
Shiba Inu price has recovered from a massive sell-off earlier in the week. The revival comes as SHIB takes advantage of the broader rally in the crypto industry, with Bitcoin (BTC) steadily peeling off its losses by rising 5.33% in the last 24 hours. Arguably the meme coin has the most desirable sentiment among its peers based on ecosystem-related fundamentals.
The positive sentiment for Shiba Inu price comes as investors wait for the emergence of the Shibarium blockchain and its deflationary propensities. As was the case for Arbitrum (ARB), there is a general appreciation that new protocols, especially Layer 2 networks on Ethereum, often draw more investors due to their wealth-creating abilities. Similarly, the expectation has piled for SHIB and could influence its uptick. There are already encouraging signs as more testers have already enrolled in Shibarium’s beta network.
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