Moving markets today: Asia follows Wall Street’s dip, bitcoin tops $60,000, oil prices drop; focus shifts to U.S. PCE inflation data
The U.S. stock market closed with minor losses as investors awaited a key inflation report that could shape expectations regarding the Federal Reserve’s interest rate decisions. Across Asian markets, trading remained subdued or saw modest declines. Bitcoin surged to $60,000 for the first time in over two years, capturing investors’ attention. The focus now turns to the release of the core personal consumption expenditures (PCE) price index, the Federal Reserve’s preferred inflation measure, scheduled for Thursday, which is expected to influence market sentiments further. Here are five key takeaways for your day.
Bitcoin surpasses $63,000 mark, eyes record high beyond $69,000
Bitcoin soared beyond $63,000 overnight, driven by a surge in investments flowing into new U.S. bitcoin exchange-traded funds. With a remarkable 45% increase this month, its highest since December 2020, Bitcoin is edging closer to a record high of $69,000. During Asia’s morning trade, Bitcoin held steady at $61,650, also lifting Ether to $3,416, reflecting a substantial 50% surge in February.
UK car production soars 21% in January: SMMT
Britain saw a 21% increase in car production compared to the previous year in January, marking five consecutive months of growth. The rise was driven by strong demand and improved supply chain conditions. The Society of Motor Manufacturers and Traders reported that 82,997 vehicles were manufactured last month, up from 68,575 units the year before, Reuters reported. The potential impact of recent shipping attacks in the Red Sea on the UK’s car manufacturing sector remains uncertain.
NY Fed’s Williams said more work required to attain 2% inflation target
John Williams, President of the New York Federal Reserve, stated that although there is still progress needed to reach the U.S. central bank’s 2% inflation target, the possibility of interest rate cuts this year is emerging, contingent upon the incoming data.
“While the economy has come a long way toward achieving better balance and reaching our 2% inflation goal, we are not there yet. I am committed to fully restoring price stability in the context of a strong economy and labour market,” Williams said, Reuters reported.
What’s coming up
Investors are keen on whether the Federal Reserve will opt for interest rate reductions starting in June. They’re eyeing the upcoming personal income and spending report, set for release on Thursday, hoping it will shed light on inflation trends pivotal to the Fed’s decision-making. Alongside, updates on US Personal Income, Personal Spending, Pending Home Sales, and weekly Initial Jobless Claims are anticipated.
Later in the session, prominent figures from the Federal Reserve such as Bostic, Goolsbee, and Mester, are scheduled to address the public.
Across the pond, the Bank of England plans to disclose money supply and personal net lending data for January, with Halifax’s monthly house price survey for February preceding the release of these figures.
Wall Street’s Decline Ripples Through Asian Markets
The Dow Jones Industrial Average edged down by 0.06% to close at 38,949.02 points, while the S&P 500 saw a 0.17% decline, settling at 5,069.76, and the Nasdaq Composite slipped by 0.55% to 15,947.74. UnitedHealth faced a notable 2.95% decrease, impacting both the Dow and S&P 500, triggered by news of a Department of Justice antitrust investigation. Applied Materials, a key semiconductor equipment supplier, experienced a 2.62% drop after being subpoenaed by the U.S. Securities and Exchange Commission in February. Conversely, Beyond Meat soared by 30.72% as it outlined plans for price increases and significant cost reductions to enhance its profit margins, resulting in a short squeeze on its heavily shorted shares.
In Asian markets, Japan’s Nikkei 225 index declined by 0.4%, and the broader TOPIX slid by 0.3% from their recent record highs earlier in the week. However, China’s Shanghai Shenzhen CSI 300 and Shanghai Composite indexes registered gains of 0.8% and 0.9%, respectively. Hong Kong’s Hang Seng index advanced by 0.2%, although the rise was tempered by GDP data indicating slightly lower-than-expected growth in the fourth quarter. South Korea’s KOSPI fell by 0.5% amid profit-taking, particularly in chipmaking stocks, following robust gains in the previous session.
In commodities trading, oil prices experienced a decline, with Brent crude down by 0.1% to $83.60 and West Texas Intermediate dropping approximately 0.15% to $78.42. Gold strengthened, pushing the precious metal to $2,036.35 per ounce, while the U.S. dollar index traded nearly flat at 103.86.