Bulls returned to Wall Street on tame U.S. producer prices
On Thursday, U.S. stocks recovered slightly, regaining much of the ground lost during the previous day's decline.
This followed Wednesday's March Consumer Price Index (CPI) reading, which was higher than expected and prompted investors to exit the market.
However, traders on Wall Street experienced relief as the Producer Price Index (PPI) data showed a slight increase of 0.2%, lower than the expected 0.3% forecasts. This followed a previous growth of 0.6% in February.
Whether the cooler inflation reported in the (PPI) cancels out the message from March's hot (CPI) report is still uncertain.
The market is now adjusting its expectations for a Fed rate cut, possibly moving it from June to either July or September meetings.
A separate report revealed that fewer U.S. workers applied for unemployment benefits last week, with unemployment claims dropping to 211,000 from 222,000 the previous week on a seasonally adjusted basis.
At the close of the New York Stock Exchange (NYSE), the Dow Jones Industrial Average, a significant indicator of blue-chip stocks, slipped by -2.43 points, or -0.01%, to 38,459.08.
The Standard & Poor's 500 Index, reflecting a wide array of stocks, climbed by +38.42 points, or +0.74%, to 5,199.06, while the Nasdaq Composite Index, which is heavily influenced by technology stocks, surged by +271.84 points, or +1.68%, to 16,442.20.
Apple emerged as the leading force among Thursday's “Magnificent Seven” names, driving the market higher.
The tech titan's stock surged by +4.3%, helping to offset its year-to-date losses.
This rally followed reports that Apple intends to revamp its Mac products with new artificial intelligence-focused chips.
Nvidia followed Apple's lead, benefiting from the excitement surrounding artificial intelligence technology.
The chip company saw a +4.1% increase, bringing its year-to-date gain to an impressive +83%, while Amazon soared to achieve an all-time high before ending the day with a +1.7% increase, setting a new record after surpassing its previous high set in 2021.
Alphabet, Google's parent company, saw a 2% increase, while Meta, formerly Facebook, rose by 0.6%. Tesla gained 1.7%, but Microsoft experienced a decline of 1.1%.
The first-quarter earnings season starts in full swing on Friday, with major U.S. financial institutions like JPMorgan Chase, Wells Fargo, Citigroup, BlackRock, and State Street set to report earnings before the bell.
In the U.S. government bond markets, the yield on the 10-year Treasury, which helps set rates for mortgages and other economy-dictating loans, finished at 4.56%, while the policy-sensitive two-year yield, which tends to reflect market expectations of future Fed moves, closed at 4.94%.
Bitcoin, the largest digital currency in cryptocurrency, remains stable above the US$70,000.00 mark. It traded within an intraday range of US$69,586.00 to US$71,249.00 before settling at US$70,204.00.
With the Bitcoin halving approaching, traders are undoubtedly considering potential opportunities ahead.
Despite the current stabilization, there's anticipation for a bullish surge in Bitcoin's price.
Some projections suggest it could range between US$78,000.00 and US$81,000.00.
However, this surge might be followed by a significant pullback, with Bitcoin potentially retreating to a range between US$56,000.00 and US$58,000.00.
It's worth noting that the fourth Bitcoin halving event is expected around April 19, 2024.
Given this assessment, traders and investors should exercise caution as volatility is expected to be high.
Therefore, it's essential to closely monitor any new developments while navigating potential trading strategies amidst market fluctuations.
Meanwhile, Ethereum, the second-largest blockchain in the cryptocurrency market capitalization, was firmer, trading within a daily range of US$3,474.00 to US$3,618.00 before closing at US$3,512.00.
Precious metal prices surged after the release of inflation data, with ongoing geopolitical tensions further enhancing their appeal. Spot gold closed at $2,392.00 per ounce, while silver closed lower at $28.78.
Energy market prices showed mixed performance, with the global benchmark Brent crude oil reaching $90.15 per barrel, while the U.S. benchmark West Texas Intermediate settled at $85.35.
The U.S. Dollar Index (U.S. DXY), which measures the dollar's strength against six major foreign currencies in the forex market, was flat at 105.25.
Meanwhile, the Eurodollar was 1.0726, and the British pound finished at 1.2555. The Japanese yen ended at 153.02, while the Australian dollar was at 0.6538.
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