Financial Markets

Inflation in the U.S. unexpectedly ticks higher in February, potentially lengthening the Fed’s path back to lower rates. However, U.S. and European equities hit new highs as investors stick with their June Fed rate cut predictions. In politics, President Joe Biden and former President Donald Trump have both won enough primary delegates to become their parties’ presumptive nominees in November’s presidential election, according to NBC News. In Japan, major companies commit to fully meet union demands for pay hikes, strengthening speculation the Bank of Japan could exit negative rates next week. Boeing suffers a plethora of quality control problems with its top clients complaining of delivery delays, cancelled flights as well as hiring freezes at the U.S. plane maker.    

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

There’s a new record high for the S&P 500 index – its 16th this year. In a testimony to the Senate, U.S. Federal Reserve Chairman Jerome Powell said the central bank was gaining the confidence it needs to cut rates. In Frankfurt, the ECB keeps rates on hold but signals a mid-year cut with President Christine Lagarde calling for more data by June. President Biden lashes out at former President Donald Trump during his third State of the Union address. Biden called on Congress to stand up to Russia’s Vladimir Putin. Humanitarian assistance to Gaza and the southern border crisis were also featured high on the agenda. Danish drug maker Novo Nordisk overtakes Tesla in market cap valuation, unveiling new trial data as well as plans to sell WeGovy in China.  

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

U.S. Federal Reserve Chairman Jerome Powell reiterates to the House Financial Services Committee that the central bank is not yet ready to begin slashing interest rates. Powell said he required more data to be confident inflation would continue falling before dialling back on restrictive policy. Chinese trade numbers beat expectations for the first two months of 2024. Foreign Minster Wang Yi has hit out at ‘lengthening’ U.S. economic restrictions on his country. In Frankfurt, the ECB is expected to keep rates on hold for a fourth consecutive month while in the UK, Chancellor of the Exchequer Jeremy Hunt cuts National Insurance contributions by a further 2 per cent.  

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

We are live in Beijing at China’s annual parliamentary session where the country has set a growth target of ‘around 5 per cent’ for 2024. Premier Li Qiang has sought to diffuse economic tensions but warned of a tricky path ahead. Tesla sees Chinese sales fall to the their lowest level since December 2022, with increased domestic competition as well as a slowdown in demand weighing on the EV maker. Brussels has slapped Apple with a €1.8bn fine for alleged abuse of its market position within the music-streaming space. And in the U.S., the Supreme Court has ruled that individual states cannot remove former President Donald Trump from the ballot for his alleged involvement in the January 6th 2021 storming of the U.S. Capitol. Delegates in 15 states are due to vote for presidential nominees this Super Tuesday.  

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

The recent optimism around A.I. helps push the Nasdaq to its first record high in more than 2 years. The Dow and S&P 500 also mark their best start to the year since 2019. Consumer prices Stateside are their slowest rate of increase in six years, raising hopes of a June rate cut. In banking news, shares of NY Community Bancorp plunge by 20 per cent in extended trade on the news that the lender has removed its CEO due to internal control matters. Chinese manufacturing activity is down for a fifth-straight month ahead of next week’s annual legislative meetings where broader policy moves may be on the agenda.  

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

U.S. markets are set to notch their fourth monthly gain but investors turn wary on tech stocks ahead of today’s inflation data. There is a tentative deal on Capitol Hill as lawmakers scramble to avert a government shutdown. Long-serving Senate Republican leader Mitch McConnell has announced he will be stepping down from his position after the U.S. election this November. Chinese equities rebound sharply despite recent volatility with the Shanghai Composite is now on track for its best month since November 2022. In tech news, Apple has teased it will be making a major A.I.-related funding announcement later this year. And luxury Italian fashion house Moncler posts a 17 per cent revenue spike due to a strong performance in China.  

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Global markets toe the line ahead of key inflation data coming out of the U.S. The recent troubles experienced by Boeing have sent U.S. durable goods orders to their steepest monthly fall since April 2020. In U.S. politics, President Biden wins the Democratic primary in Michigan while former President Donald Trump easily notches his fifth state victory ahead of Super Tuesday. Following President Macron’s comments about potential NATO boots on the ground in Ukraine, Western leaders push back but speaking to CNBC, former Ukrainian president Petro Poroshenko urges unity and strength in the face of Putin’s aggression in his country. In tech news, Apple reportedly ditches plans for its EV to instead focus on its generative A.I. unit. We have continuing coverage from the Mobile World Congress in Barcelona where Honor enters the high-end smart phone space with its first foldable flip phone. Cisco CEO Chuck Robbins tells CNBC that A.I.’s impact will soon become very visible and transformative. 

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

In this week's episode, Mark looks at the type information that investors need, but do not have. These anti-wild cards are going to appear in the economy, but no one really knows what, where, or when. Mark looks back at some historical examples.

See also Surprised Again! The Covid Crisis and the New Market Bubble by Alex Pollock and Howard Adler: Mises.org/MI_59A

Be sure to follow Minor Issues at Mises.org/MinorIssues.

Get your free copy of Dr. Guido Hülsmann's How Inflation Destroys Civilization at Mises.org/IssuesFree.

Nvidia shares pop in after-hours trade after the chip giant posted a 265 per cent surge in Q4 revenue. CEO Jensen Huang tells CNBC that conditions are ideal to grow the company. As a result the chip sector rallies, pushing Japan’s Nikkei to levels not seen since 1989. The Fed urges caution in cutting rates too early. BofA CEO Brian Moynihan says the central bank should not repeat mistakes of the past. And in autos news, Mercedes-Benz is to launch a share buy-back worth $3bn ahead of results later this morning. 

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

HSBC shares dip in Hong Kong despite the lender posting a record FY profit. The result was marred by a write-down on its share of Chinese bank BOCOM. HSBC CEO Noel Quinn tells CNBC he is still upbeat on the country’s economy. Chinese indices claw back earlier losses after the market regulator said it would increase supervision while the Shanghai and Shenzhen bourses crack down on a key quant fund. Wall Street suffers a second day of losses after chip giant Nvidia records its worst session since October. The company’s earnings are due later today. And in retail news, French supermarket giant Carrefour announces a 55% dividend hike after seeing record cash flow of €1.6 bn.   

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

We are live at the Munich Security Conference where the death of Alexei Navalny on Friday and dwindling Ukrainian military supplies against Russia have dominated discussions over the weekend. We hear from NATO Secretary General Jens Stoltenberg who says he does not believe a potential Trump administration would abandon the alliance. Russian forces re-take the eastern Ukrainian city of Avdiivka – its first major victory in 9 months. Ukrainian President Volodomyr Zelenskyy says his country is awaiting more military aid from the West. Chinese indices are relatively flat following the week-long Lunar New Year festivities but data shows holiday spending topping pre-pandemic era levels. And in tech news, Apple is to be hit with a €500m anti-trust fine from the EU as part of an investigation whether it restricted apps from providing users with information about cheaper music-streaming subscriptions.

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

In the old days, the Federal Reserve operated in obscurity "behind the curtain". Today, they are front-and-center for the stock market. Total credit card debt in the US is now over $1.1 Trillion. In this episode, Mark looks at the disconnect between the Fed, the stock market (featured in the last episode), and the Real Economy.

Be sure to follow Minor Issues at Mises.org/MinorIssues.

Get your free copy of Dr. Guido Hülsmann's How Inflation Destroys Civilization at Mises.org/IssuesFree.

On February 13, 2024, Bob participated (with Jim Rickards, Brent Johnson, and Michael Every) in a ZeroHedge debate on the fate of the USD. In this episode of the Human Action podcast, Bob highlights some of the key issues and explains why he thinks his side won.

The ZeroHedge Debate: Mises.org/HAP435a

Brent Johnson's Milkshake Theory: Mises.org/HAP435b

Egert's Article on the Public Debt Threshold: Mises.org/HAP435c

Bob's Article on the Latest CBO Federal Debt Report: Mises.org/HAP435d

Human Action Podcast listeners can get a free copy of Dr. Guido Hülsmann's How Inflation Destroys Civilization: Mises.org/HAPodFree

On February 13, 2024, Bob participated (with Jim Rickards, Brent Johnson, and Michael Every) in a ZeroHedge debate on the fate of the USD. In this episode of the Human Action podcast, Bob highlights some of the key issues and explains why he thinks his side won.

The ZeroHedge Debate: Mises.org/HAP435a

Brent Johnson's Milkshake Theory: Mises.org/HAP435b

Egert's Article on the Public Debt Threshold: Mises.org/HAP435c

Bob's Article on the Latest CBO Federal Debt Report: Mises.org/HAP435d

Human Action Podcast listeners can get a free copy of Dr. Guido Hülsmann's How Inflation Destroys Civilization: Mises.org/HAPodFree

Renault enjoys a FY operating margin on revenue of more than €50bn and is set to hike its dividend. French aviation giant Airbus sees full-year results surging on the back of a record orderbook and is also due to propose a special dividend payout. On Wall Street, the S&P 500 is back up at the 5,000-point mark as chip maker Nvidia briefly overtook Alphabet on market cap value. Meanwhile Berkshire Hathaway pares back its Apple stock and ramps up investment in Chevron. The company has sought confidentiality from regulators to keep its stock purchases secret in its latest 13-F filings. 

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

U.S. inflation for January disappointed, coming in at more than 3 per cent on an annual basis dashing any hopes of an imminent Federal Reserve rate cut. The markets reacted with the Dow posting its worst session since last March and Treasury yields spiked. DoubleLine CEO Jeffrey Gundlach told our colleagues Stateside that markets had vastly overestimated this year’s rate path. Ride-hailing app Lyft sees shares soar by 60 per cent in extended trade but then paring back sharply after management admitted to an accidental extra ‘zero’ to its margin growth number. And in tech news, Nvidia overtakes Amazon in terms of market cap valuation on the back of the A.I. boom. The chip giant now has Alphabet in its sights which would make it the third-largest firm on Wall Street.

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

The Dow hits a new record ahead of today’s inflation report Stateside. The CPI growth has been seen below 3 per cent, which would be a first in three years. The CEO of Abu Dhabi’s SWF Mubadala, Khaldoon Al Mubarak, tells CNBC that the U.S. remains an attractive investment destination. ARM shares are up by almost 30 per cent, extending the post-earnings rally, which boosts one of its primary stakeholders Softbank in Japan. We also hear from Aston Martin Lagonda chairman Lawrence Stroll who dismissed suggestions that the sports car maker will require new funding to deliver its goals. And in political news, EU foreign chief, Josep Borrell, says that NATO cannot be an a la carte alliance, following former U.S. President Donald Trump’s funding comments while German Chancellor Olaf Scholz said he believed America would honour its commitments to the bloc.  

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

In this week's episode, Mark takes a quick look back at Fed wisdom in the year 2000, and then surveys today's stock market—and, in particular, the Magnificent Seven stocks, which represent very narrow leadership of the overall stock market.

Be sure to follow Minor Issues at Mises.org/MinorIssues.

Get your free copy of Dr. Guido Hülsmann's How Inflation Destroys Civilization at Mises.org/IssuesFree.

Moody’s cuts its rating on New York Community Bankcorp to junk status, causing its shares to nose-dive to their lowest level since 1997. However, the U.S. regional lender remains adamant, saying ‘ample’ liquidity of more than $37bn. Snap shares fall by more than 30 per cent in extended trade after missing earnings expectations in the fourth quarter. The company says that the Middle East turmoil is creating headwinds. Siemens Energy confirms its outlook after posting a 24 per cent jump in orders. It said it would remain focused on rectifying problems with its offshore wind business, Gamesa. In Italy, a controversial capital markets reform bill is sent to the Senate after the Chamber of Deputies approves measures to attract more listings in the country. And in aviation news, Boeing admits it must perform better after an initial NTSB report said four key bolts were missing from the plug door of an Alaska Airlines 737 Max which blew out mid-air.

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Mark talks about the Fed's Reverse Repo Operations, which explain the conundrum of the Fed's "tight" monetary policy and new record highs in the stock market. It turns out that the Fed is not a bunch of "tightwads" after all, but has served up a nearly $2 trillion monetary injection since the bond market cratered last year.

Be sure to follow Minor Issues at Mises.org/MinorIssues.

Get your free copy of Dr. Guido Hülsmann's How Inflation Destroys Civilization at Mises.org/IssuesFree.