Monday's Markets Update (December 16, 2024)

18 Dec 2024 by rate3

On Monday, the S&P and Nasdaq rose, breaking the 22K mark for the first time, driven by gains in Tesla, Broadcom, Alphabet, and Apple. However, the Dow Jones continued to decline, reflecting deterioration in the manufacturing sector. Investors are focused on the Fed's interest rate decision in two days. In the EU, production declined once again. India's trade deficit reached a record high as its economy continued to worsen. Nigeria's inflation rate surged to a near 30-year high, accelerating the pace of crypto adoption. BTC reached a new all-time high of $107K on the weekend and has since settled down, while ETH breached $4K prior to that.

Details

The NY Empire State Manufacturing Index fell sharply in December, indicating a slowdown in business activity in New York State. While some indicators like delivery times and input prices improved, overall sentiment remains cautious. 1Y trend: "Up" (NYF)
The private sector activity expanded at the fastest pace in ten months in December. The services sector led the growth, while manufacturing continued to contract. However, business optimism improved, suggesting a positive outlook for the economy. 1Y trend: "Up" (PMI)

Crypto

Crypto startups have raised over $1B in venture funding since Trump's election. This surge in investment is driven by optimism around pro-crypto policies and regulatory clarity. Key areas of investment include blockchain infrastructure, DeFi, and crypto mining. (source)

World Markets

European stocks declined as investors assessed the economic outlook and awaited central bank decisions. Weak economic data from the Eurozone and concerns about French political stability contributed to the market's downturn. Automakers were particularly hit hard due to concerns about Chinese competition. Moody’s downed France's rating to Aa3 from Aa2. Scholz received non-confidence vote, now German elections will be held late February. 1Y trend: "Up"
The Eurozone's private sector activity contracted at a slower pace in December. While manufacturing remained weak, the services sector expanded. However, new orders declined, and job cuts accelerated. Despite this, business optimism improved slightly. 1Y trend: "Up" (PMI)
India's trade deficit reached a record high of $37.8B in November. This was due to a surge in imports and a decline in exports. 1Y trend: "Up" (IN)
Nigeria's inflation rate surged to a near 30-year high of 34.6% in November, driven by rising food and core inflation. This indicates a worsening cost-of-living crisis in the country. 1Y trend: "Up" (NG)

Currencies

The Chinese yuan weakened to 7.28 as mixed economic data raised concerns about the country's economic recovery. While industrial production and fixed-asset investment showed some improvement, retail sales growth slowed down. The expected loosening of monetary policy and potential US trade pressures are also contributing to the yuan's weakness. 1Y trend: "Up, Depreciating"