March 5, 2024
CURRENCIES:
US Dollar’s Uncertain Direction Ahead of Key Events
- The US dollar shows no clear trend as it awaits significant US events.
- Federal Reserve Chair Powell’s upcoming testimony to Congress is a potential volatility trigger.
Technical Analysis on Major Currency Pairs
- The article provides a technical outlook for the EUR/USD, GBP/USD, and USD/CAD pairs.
Mixed Performance Against Major Counterparts
- Despite some gains, the US dollar’s appeal is inconsistent, even with rising US Treasury rates boosting it in theory.
Market Caution Due to Packed Economic Calendar
- Traders are wary of taking significant positions due to a busy economic schedule that could increase market volatility, including ISM services data, Powell’s Congressional testimony, and the US NFP report.
Focus on Powell’s Testimony
- Powell is expected to maintain a stance of no immediate need for easing monetary policy, following stagnant progress on disinflation from recent CPI, PPI, and PCE data.
- A hawkish surprise from Powell could raise yields and support the US dollar.
STOCK MARKET:
Stock Market Retreats from Record Highs
- S&P 500, Nasdaq, and Dow Jones Industrial Average saw declines amid investor caution.
- Federal Reserve Chair Jerome Powell’s testimony and upcoming jobs report could challenge recent equity gains.
Impact on Major Indexes
- S&P 500 slightly down, breaking its streak of weekly wins.
- Dow Jones drops by 0.2%; Nasdaq falls by 0.4%, influenced by declines in Apple and Tesla shares.
Tech Sector Rally and Bubble Concerns
- Nasdaq’s recent high fueled by AI-driven tech stock run-up.
- Nvidia’s valuation reaches $2 trillion, raising bubble concerns, though not all analysts are alarmed.
Cryptocurrency and Commodities Performance
- Bitcoin approaches record highs with over 7% gain.
- Gold futures hit a record, with April contracts at $2126.3 per ounce.
- Japan’s Nikkei 225 surpasses 40,000 level for the first time.
Upcoming Economic Indicators
- Powell’s testimony and February jobs data anticipated to influence interest rate decisions and economic outlook.
Regulatory Actions and Market Movements
- EU fines Apple $2 billion over App Store restrictions, impacting its shares.
- Super Micro Computer surges before joining S&P 500; Macy’s stock up after increased buyout offer.
- Spirit Airlines and JetBlue stocks fluctuate following the termination of their merger agreement.
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