Thursday's Markets Update (March 21, 2024)

21 Mar 2024 by rate3

On Thursday, manufacturing activity is down, service sectors cools a bit, home sales grows unexpectedly, stocks soar on continuing tech lead rally with Micron up 16% on strong earnings. Reddit debuts on NYSE, but Apple tumbles on DOJ lawsuit. Internationally, EU manufacturing sector continue to soften, as Swiss Bank cut its key rate while Bank of England kept its rate unchanged but showed signs of softening its anti-inflationary stance. Despite that, crypto market turned red correcting after yesterday's surge on Fed turning dovish enthusiasm. BTC's trading slightly above 65K, ETH - 3.4K. Among few coins which are still in a green are XRP (+7%) and LTC (+1%).

Details

Service sector growth cools down in March, with PMI dipping to 51.7 (3-month low). New business slows, but employment rises. Businesses see higher inflation and are boosting marketing plans despite these mixed signals. (SP)
Philly Fed Index dips to 3.2 but beats forecasts (expected -2.3). Shipments and new orders improve, suggesting some expansion. Prices remain low, but future activity expectations rise.(PhilFed)
Existing home sales surged 9.5% to a 1-year high (4.38 million) in February, defying forecasts. More houses on the market are meeting buyer demand, with gains in all regions except the Northeast. (NAR)

Crypto

Massive real-world asset tokenization (such as $326 trillion in real estate or the gold market, valued at $12.39 trillion) could fuel the crypto market by boosting liquidity. That trend is confirmed by main-stream opinion's leaders - the Boston Consulting Group and the BlackRock. (source).
India cracks down on foreign crypto exchanges like Binance and OKX, blocking their websites and prompting an exodus to local exchanges. Local exchanges see massive user inflows with the government's unclear regulations and high taxes making things difficult for foreign players. (source)

World Markets

Bank of England holds rates at record 5.25% despite inflation dipping to 3.4% (lowest in nearly 30 months). One member voted for a cut, but policymakers wait for clearer signs inflation is under control before easing. (BoE)
German manufacturing PMI sinks to 41.6 (worst in 5 months) despite a slower decline in output. Backlogs and employment continue to fall, but sentiment improves. (SP)
French manufacturing PMI tumbles to 14-month low (45.8) as output and sales plummet. Despite some supply chain improvement, job cuts held steady.(SP)
EU car sales surge 10.1% in February (+12.1% previous), with strong growth in France and Italy. Battery electric cars hold 12% market share (up from 9%), boosted by Belgium, France, and Netherlands despite a German dip. (Acea)

Currencies

Mexican peso weakens after central bank cut rates (25bps to 11%). Inflation dips but remains above target (4.4%). Investors weigh the Bank of Mexico's move against the Fed's planned rate cuts later in 2024.

Commodities

Gold continued to increase, fueled by expectations of central bank easing. The Fed signaled rate cuts, and now the Bank of England holds steady, with one vote for a cut. Switzerland became the first major economy to cut rates, further boosting investor confidence in looser monetary policy