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  • Writer's pictureStéphan
    • Jan 25
    • 4 min read

FED's #BTFP to end 11th March & incr. rate on loans to banks / U.S Q4 GDP, PCE and ECB up next



  • Fed to allow emergency bank lending program expire on March 11 and the FED raised the rate on loans to banks issued under an emergency lending program launched last year, after borrowing surged in recent weeks as institutions took advantage of the attractive financing terms

  • Alibaba co-founders buy more than $200 million worth of shares, sending stock up (there will be more similar moves elsewhere, no doubt).. part of 'trying to improve sentiment' in addition to all the state interventions..

  • Qube Research & Technologies Ltd. has amassed a short bet of more than $1 billion against German companies amid a downturn in global demand that’s slowing Europe’s biggest economy., maybe not best idea to tell everyone ?

  • There are now 7 companies in the Trillion Dollar Club again. Meta has passed the $1tn mark, and Microsoft is now worth $3tn for the 1st time ever

  • Musk : Tesla says "our vehicle volume growth rate may be notably lower than the growth rate achieved in 2023.", Tesla Q4 revenues increased 3.5% YoY, its slowest growth rate since Q2 2020. Gross margins fell to 17.6% from 23.8% a year ago, largely a result of the deep price cuts on its vehicles >>> China’s EV players ramp up competition with Tesla using new tech

  • China Financial News, a PBOC-backed media outlet, said Monday's State Council meeting indicated that more practical policies are coming

  • The ECB has asked some banks to monitor social media for early signs of bank runs

  • UAW’s Shawn Fain says Trump ‘doesn’t care about the American worker’ as union backs Biden for re-election

 

Markets :

  • TLT closed at its lowest since Dec 4th and is now again firmly below its 200dma, $61 billion 5y UST auction no bueno: 2 bps tail, highest dealer takedown since Sept 2022 (per BMO)

  • China Eq #HSI #CHINA50 etc . stay bullish, contrarian trade supported by enormous PBOC action, if CNH strengthens somewhat (or does not weaken on higher UST yields) it will confirm capital inflows

  • EURstoxx50 hitting 23y highs at 4'575, still far away from the 2000 highs nearer to 5'250

  • U.S. markets hitting news highs>>> weak 5Y UST auction, TSLA weaker, if you want to look for a few signs of potential weakness outside the Mag 7's there are plenty, but so far it didn't matter! >>> facts, RSI, overbought, % of stocks above 200dmas etc

  • Copper, Iron Ore and other commods generally a little higher (China action..)


 

Summary:  Market is seemingly focused on resilient growth in the US economy, and has pared March rate cut expectations for the Fed. While growth metrics remain mixed, focus will likely return to disinflation with core PCE this week pointing towards a move to 2% inflation by mid-2024. Soft core PCE below 0.2% MoM for December will likely increase the odds of a March rate cut again, pushing yields and dollar lower.




It's way oversold and unowned


That's one strange article..








Tottenham Hotspur billionaire Joe Lewis pleads guilty to insider trading charges in US | UK News | Sky News - why do insider trade when a billionnaire ?...lots of war stories from while back on the FX world...


Not great to be too critical of the troops like this...







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