Weekly News 2023/08/28-2023/09/01

 Investors were paying close attention to a speech by Federal Reserve Chairman Jerome Powell at the Jackson Hole Economic Symposium on Friday. Sentiment was boosted by Federal Reserve Chairman Jerome Powell's comments on U.S. economic growth. U.S. stocks closed higher on Friday. The Dow rose 247.48 points, or 0.73%, to 34346.90; the Nasdaq rose 126.67 points, or 0.94%, to 13590.65; the S&P 500 rose 29.40 points, or 0.67%, to 4405.71. For the week, the Dow fell 0.45%, its second consecutive weekly loss. The Nasdaq rose 2.26 percent and the S&P 500 rose 0.82 percent, both recovering after three straight weeks.

Federal Reserve Chairman Jerome Powell said in a speech at the Jackson Hole Economic Symposium that inflation is too high and that interest rates will be raised further if necessary, but also pointed out that economic growth is better than expected.

Powell noted that the economy is growing faster than the Fed expects. He said: “2% is still and will continue to be our inflation target. Inflation data has become more favorable, but it is still too high and there is still a long way to go.”

JPMorgan Chase (147.05, -0.18, -0.12%) chief global equity strategist Dubravko Lakos believes that this year's rally in U.S. stocks is over because there are many factors that will weigh on the market until the end of 2023, including: Stock valuations Relatively too high, investors' positions are too bullish, monetary policy may remain tight, and fiscal policy will be tightened.

Bank of America strategists headed by Michael Hartnett expects the S&P 500 to fall 4% to 4,200. Over the past decade, the benchmark has fallen an average 1.5% in September.

 IBM (NYSE: IBM) and Hugging Face, an open-source artificial intelligence platform, jointly announced on Thursday that the former participated in the latter's $235 million Series D financing. This additional funding will further strengthen Hugging Face's position as the leading open source and open science artificial intelligence platform. IBM and Hugging Face recently announced a collaboration on watsonx, IBM's generative artificial intelligence platform, to help companies build, deploy and customize foundational models across multiple domains. In watsonx, AI builders can leverage models from IBM and the Hugging Face community that are pre-trained to support a range of natural language processing (NLP) tasks, including question answering, content generation and summarization, text classification and extraction.

Gaps (NYSE: GPS) second-quarter earnings per share were $0.34, analysts expected $0.097; second-quarter net sales were $3.55 billion, analysts expected $3.57 billion; second-quarter same-store sales fell 6%, analysts expected a decline 4.53%; it is expected that the annual net sales decline will be around 5%; it is expected that the net sales in the third fiscal quarter will experience a low double-digit decline year-on-year; the gross profit margin in the second fiscal quarter is 37.6%, and analysts expect 37.4%; Expectations for annual gross margin expansion remain unchanged.

Tesla (NASDAQ: TSLA) once again knocked on the door of the world's third largest auto market, using the promise of building a factory in exchange for lowering import taxes. India's import car tax of up to 100% is likely to be opened by Tesla, provided that the global leader in electric vehicles promises to bring the production line to India. According to media reports on Friday, the Indian government is drafting a new electric vehicle industry policy. For companies that promise to carry out some local production, the Indian government may cut some imported car taxes as an incentive policy.

 Bitcoin is down 1.45% for the week, according to CoinMarketCap. The world's largest cryptocurrency by market capitalization has been trading below $30,000 since Aug. 9. Ether, the world's second-largest cryptocurrency, fell 1.84% this week to $1,654.

Bitcoin fell to $25,628 on Wednesday, its lowest point in two months.Alex Konanykhin, CEO and founder of Unicoin, an equity-backed cryptocurrency that pays dividends, said the cryptocurrency has been dragged down by a combination of factors, including a sell-off by major shareholders during times of low liquidity. “Bitcoin is inherently volatile. Negative news or a large sell-off could send its price down, especially in late summer when liquidity is at its lowest.”

The Crypto Fear and Greed Index, a multi-factor gauge of sentiment in the cryptocurrency market, fell to 37 on Wednesday, its lowest point since March 12, when it plummeted to 32 two days after the third-largest U.S. bank collapsed. point. Cryptocurrency-friendly Silicon Valley bank collapses.

“Analyzing the July Fed minutes, it is clear that policymakers are struggling to make a decision on further rate hikes as they acknowledge the threat of a revival in inflation,” cryptocurrency exchange Bitfinex said in its research note. All eyes are on Federal Reserve Chairman Jerome Powells Jackson Hole speech on the economic outlook.

On Friday, the global cryptocurrency market cap was $1.05 trillion. Trading volume was down 10.25 percent from $1.17 trillion a week earlier, according to CoinMarketCap. Bitcoin has a market cap of $508 billion, or 48.4 percent of the market, while Ethereum has a market cap of $198 billion, or 18.9 percent.

 Gold prices fell on Friday, snapping a four-session winning streak after Federal Reserve Chairman Jerome Powell said further rate hikes may be needed.

The dollar and benchmark 10-year U.S. Treasury yields climbed, undermining the appeal of non-yielding gold. Phillip Streible, chief market strategist at Blue Line Futures, said it looked like Powell was sticking to his previous statement that he wanted to keep interest rates higher for longer and would continue to make decisions based on data, which weighed on gold.

Powell told the Jackson Hole Economic Policy Symposium that Fed policymakers will “exercise caution in deciding whether to tighten policy further,” but also made clear that the central bank has not yet concluded that benchmark interest rates are high enough to keep inflation rates back to the 2% target.

ECB policymakers are also gaining momentum for a pause in rate hikes amid a deteriorating growth outlook. ECB President Christine Lagarde is due to speak later in Jackson Hole. “If she can lift the euro, you could see a weaker dollar and that could lift gold,”

Silver rose 0.1% to $24.15 an ounce, while palladium fell 1.5% to $1,222.22. Platinum rose 0.9% to $942.20. Silver and platinum also had their best weekly performance since July 14, while palladium was set for a second straight weekly loss.

Next week will be the time when the end of the month and the beginning of the month will alternate, and many economic data will be released. The preliminary PMI data released by Europe and the United States this week show that the manufacturing and service industries have further declined. The final PMI data released next week is expected to highlight the European and American economies. The economy may have contracted in the third quarter.

 Crude oil futures climbed about 1% on Friday, hitting their highest in a week, as U.S. diesel prices surged, the number of active oil rigs fell and a fire at a refinery in Louisiana. Gasoil futures surged about 5% to hit their highest in nearly seven months, boosting the diesel crack spread, which measures refining margins, to its highest since January 2023.

“It's mostly concerns about diesel prices, diesel crack spreads and diesel shortages for refinery maintenance, provide support for oil prices.” said Phil Flynn, an analyst at Price Futures Group.

Weak economic data and a stronger dollar limited gains in oil prices. For the week, Brent fell less than 1 percent and U.S. crude fell about 2 percent. Both benchmarks fell around 2% last week.

The fire at Marathon Petroleum's massive naphtha storage tank in Garyville, Louisiana, was contained Friday afternoon. The refinery capacity of the plant is 596,000 barrels per day.

U.S. energy companies cut oil rigs for a ninth straight month in August, energy services firm Baker Hughes said in its closely watched report.

Crude oil prices rose despite weak economic data from Germany, Europe's largest economy. The U.S. dollar rose to its highest level in 11 weeks after Federal Reserve Chairman Jerome Powell said further rate hikes may be needed to fight inflation.

U.S. consumer confidence edged down in August as inflation expectations worsened slightly, a survey showed.

Analysts at Morgan Stanley said they expected Brent crude to be well supported around $80 a barrel, with crude likely to remain in deficit for the rest of the year before returning to a small surplus in early 2024.

 The dollar was steady on Friday, ending the week higher after Federal Reserve Chairman Jerome Powell said the central bank may need to raise interest rates further to ensure inflation is contained, but he pledged to “proceed with caution” at an upcoming meeting.

The U.S. dollar index , which measures the greenback against six major currencies, was little changed at 104.06 after touching 104.44, its highest since June 1.

The index rose 0.6% for the week and was on track for a sixth straight weekly gain, buoyed by signs of resilience in the U.S. economy, which strengthened the case for keeping rates higher for longer. “Overall, the speech was less hawkish than the market had feared,” said Karl Schamotta, chief market strategist at Corpay in Toronto.

Both the euro and sterling have been hit this week by weak business activity data that prompted investors to scale back bets on further rate hikes in the euro zone and Britain.

Eight sources with direct knowledge of the discussions said ECB policymakers were increasingly concerned about a deteriorating growth outlook and while discussions were still underway, momentum was building for a pause in rate hikes that weighed on the euro. On Friday, EUR/USD was down 0.01% at $1.08085.

The yen continued to come under pressure as traders watched for signs that the Japanese government was preparing to intervene to support the currency, as it did last year.

Sterling fell to a 10-week low on Friday as investors scaled back expectations for a peak Bank of England interest rate following recent weak economic activity data. In late New York trade, the pound was down 0.03% at $1.2597, its weakest since June 13.

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