Daily Digest: Monday 1st April
USA
US traders returned to their desks as the Easter Break concluded on Sunday evening, index futures appeared strong, as momentum pushed upwards toward the open. However, trading through the session was mixed, the Nasdaq 100 ($NDX) managed to erase Thursday’s losses, rising 0.21% to 18,293.20, while the S&P 500 and Dow both closed down. The S&P 500 ($SPX) fell 0.2% to 5,243.77, a slight decline from its all-time highs, and the Dow ($INDU) fell a sharper 0.60% to 39,566.85 with the index failing to test the 40,000 level. April 1st marked the start of a new business quarter, meaning earnings season will roll around again, though the calendar remains relatively quiet throughout this week.
The recently IPO’d social media businesses, Reddit ($RDDT) and Trump Media & Tech Company ($DJT) shares continued to decline on Monday, as prices fell 6.73% and 21.47% respectively. This suggests that after early rallies, investor sentiment toward the two companies remains uncertain, with volatility continuing into Reddit’s second week of trading and DJT’s first full week. The presence of such volatility across both firms makes them un-investable at present, though as markets calm and traders conduct stronger fundamental analysis they may become more attractive.
Europe
The major European exchanges remained closed through Monday, as the Easter break continued.
Rest of the World
The Nikkei 225 (¥N225) fell 1.40% through Monday, falling below the 40,000 level for the first time since the 19th March. The index now trades at 39,803.09, with a weaker Yen failing to support upside momentum. The Japanese Yen itself also continued to depreciate against the US dollar through the day, falling to ¥151.359 as of 12:11 GMT.
Chinese manufacturing and non-manufacturing PMI figures were released on Sunday evening. During March, the manufacturing PMI was 50.8, coming in 0.7 points above analyst estimates, signalling a faster and stronger than expected expansion of industrial activity. This comes after four consecutive months of manufacturing PMI contractions, and indicates that industrial economic activity may finally have bucked the downward trend as it targets a return to its pre-Covid levels. Non-Manufacturing PMI figures for March also came in at a positive shock, recorded at 53, comfortably surpassing analyst expectations of 51.3. These data prints indicate that activity within China’s economy as a whole during March was significantly stronger than in February. The Shanghai Stock Exchange Composite Index (¥SSE) rose 1.19% through the session to 3,077.38, as traders benefitted from the more robust economic output figures.
The Indian Nifty 50 (₹NSEI) continued to gain through the session, rising 0.61% to 22,462.
Cryptocurrencies
The total market capitalisation of all cryptocurrencies continued to fall throughout the weekend, reaching $2.62 trillion as of 21:00 GMT on Monday. Bitcoin recorded intraday lows of $68,000, before prices rebounded back above the $69,000 support level which was tested at least twice during the day. There have been no notable data or news releases capable of shifting momentum, as the cryptocurrency enters a third week of trading sideways. Altcoin direction wasn’t too different, Ethereum falling 4.45%, Solana falling 3.61%, and Binance Coin falling 4.57% throughout the last 24 hours.
'Crypto Stocks'
US listed cryptocurrency exchange Coinbase Global Inc ($COIN) shares fell through Monday, as traders contend with last weeks SEC lawsuit, and a stagnating cryptocurrency market. Share prices fell 4.91% to $252.11. MicroStrategy ($MSTR) shares also struggled through Monday, a move explained in yesterday’s post. Prices fell a further 3.98% to $1.636.74, as traders effectively priced in the validity of Hedge Fund Kerrisdale Capitals claims, released within a document on Thursday.
Commodities
Crude continued to rally through Monday, as markets reopened following the Easter Break. As noted yesterday, the major catalysts for a change in sentiment remain the same as they have done throughout the last month. Crude prices rose 0.93% through the day, reaching an intraday peak of $84.49 per barrel, before retracing to $83.84 as of 21:00 GMT. The move marked a third consecutive trading day of gains, with prices $2 above last Monday’s close. It is important to note that the $84 level continues to pose a significant psychological block to traders, with prices failing to find support, and later meeting resistance at that level. Technical resistance levels are known to become support levels when trader convictions are strong, and price breakouts occur.
Gold prices also benefitted from the long weekend, as traders doubled down on their positions regarding the direction of major central banks toward interest rates. Prices rose a further 1.04%, breaking new highs and reaching $2,261.60 per ounce by 21:00 GMT. Monday marks an eighth trading session of price increases, with the last decline recorded on the 19th of March.
What to watch
UK Manufacturing PMI
Eurozone Manufacturing PMI
Sources:
https://uk.finance.yahoo.com/world-indices/
https://uk.finance.yahoo.com/commodities
https://www.londonstockexchange.com/indices/ftse-100
https://www.binance.com/en-GB/price/bitcoin
https://www.binance.com/en-GB/price/ethereum
https://qontigo.com/index/sxxp/
Stock Market Activity Today & Latest Stock Market Trends | Nasdaq
https://coinmarketcap.com/charts/#market-cap
https://www.forexfactory.com
Definitions:
YoY - Year on Year, or, Year over Year
MoM - Month on Month, or, Month over Month
QoQ - Quarter on Quarter, or, Quarter over Quarter
ECB - European Central Bank
BOJ - Bank of Japan
Fed - Federal Reserve
BOE - Bank of England
SNB - Swiss National Bank
DOJ - Department of Justice