Brief analysis today: We see a healthy / overdue correction in New York as investors are concerned about high valuations and the interest rate outlook. Bad news continues to weigh – we see Apple and Tesla in particular extending their (heavy) losses from yesterday. Chip stocks are still in demand – but here too the risk of profit-taking is increasing significantly. AMD is facing headwinds as the chipmaker is confronted with a US blockade on the sale of an artificial intelligence chip to China.
We continue to see a strong over-positioning in tech stocks – especially mega-cap stocks. Overall market depth is relatively shallow, suggesting that general profit taking is occurring today.
Traders are also reluctant to make big bets ahead of Fed Chairman Jerome Powell's hearing before Congress later this week. Even though he will surely (just) repeat the message that the Fed is in no hurry to cut rates – there will be nothing new. We therefore expect market sentiment to improve again after Powell's hearing.
For today, however, we expect further profit-taking, which will mainly be seen in the (large) technology sector. We see that investors are enthusiastic about Bitcoin (and gold) and expect both assets to reach new highs almost simultaneously.
The overall slight deterioration in risk sentiment will have an additional impact on growth stocks and riskier assets such as commodities.
👁 ROB'S MARKET OVERVIEW:
March 05, 2024
🌐/🇺🇸 Global Markets ↕️/↘️ (markets remain mixed / but more broad losses today)
Cyclical / Luxury Stocks ↘️
Tech/Growth Stocks ↕️/↘️
Financial Stocks ↘️/➡️ (Financials more stable than most sectors today)
Defensive Stocks ➡️
Energy Stocks ↘️/➡️
Materials Stocks ↘️
💱 Forex
JPY ↗️
USD ↗️/➡️ (slight gains as traders expect more hawkish Fed voices)
EUR, CAD ➡️
CHF ➡️/↘️
GBP ➡️/↘️ (headwinds due to lower gilt yields / worsened risk sentiment)
AUD ↘️ (headwinds due to lower commodity prices / worsened risk sentiment)
⚒ Commodity Markets ↕️
Oil prices ↘️/↕️ (headwinds on worsened risk sentiment; temporary)
Natural Gas prices ↕️
Metal prices ↘️
Gold ↗️ (positive momentum remains intact – new ATHs in sight)
⚡️Cryptos ↕️/↗️ (positive momentum remains intact – new ATHs in sight)
(*↗️ bullish, ↘️ bearish, ➡️ sideways / stable, ↕️ mixed / volatile)
Your Robert
