SignalPlus Macro Research Report (20230823): Encryption market continues to slump
The market is basically consolidating ahead of this weeks Jackson Hole annual meeting and Nvidias earnings report; Fed Barkin said, If inflation remains high and demand shows no signs of slowing, we will need to tighten policy further,The 2-year U.S. Treasury yield once again exceeded 5%, reaching its highest level since 2006. In addition, just before Powells talk at Jackson Hole, Nick Timiraos, a well-known reporter for the Wall Street Journal, recently published an article titled Why the Era of Historically Low Interest Rates May Be Over, arguing for an increase in the neutral federal funds rate. (r* or r-star), as the theme of Fridays annual meeting is structural changes in the economy, the market expects some discussion of higher long-term equilibrium interest rates, exacerbating the decline in fixed income prices in the past week Potential.
On the economic data front, U.S. existing home sales slowed in July and a tepid Richmond Fed manufacturing index had little impact on risk sentiment; the next part of the focus will be on the often overlooked U.S. labor force Bureau of Statistics QCEW (Quarterly Census of Employment and Wages),The data was widely expected to be revised downwards, showing a sharp slowdown in job growth over the past year., investment bank economists and Fed officials have all mentioned that compared with previous cycles, the seasonal adjustment of wages is much higher than normal, and JPM expects the initial adjustment to cut nearly half a million jobs from 2022 levels.If the final data does not show a downward revision, it will definitely surprise the market and this situation may become a risk factor for bonds.
Stocks staged a mitigating rebound in Asia, rising to near one-week highs, but asNegative news from bank downgrades and poor performance from retailers, stocks fell again in New York trading; SP downgraded some banks due to rising interest costs, sending the KBW bank index to its lowest level since June, while Macys warned of uncertainty in the macroeconomic environment and highlighted End consumer credit issues reported by the companyCredit card delinquency rates higher than expectedShares plunged 14% on the day, the biggest one-day drop since June 2022, the CEO blamed on the end of student loan forgiveness, rising interest rates and fewer job opportunities.
Nvidia is about to announce its earnings results, and its stock price fell nearly 3% yesterday. The giants earnings performance is expected to drive the outlook for technology stocks in the near future. Due to the rise of the AI field, the markets EPS expectations have jumped since May. , although the overall risk sentiment in the market is sluggish, its stock price remains near this years high,Keep an eye out for Nvidias second-quarter earnings results after the close today.
On the cryptocurrency front, BTC and ETH prices have yet to break out since last weeks mini-flash crash, with volumes remaining weak and trading sentiment subdued. However, after the rapid rise and fall of BTC ordinals, AI tokens, and “security tokens,”friend.tech becomes latest cryptocurrency killer app, getting market attention, the app builds on Coinbase’s recently launched Base L2 network, allowing Twitter (X) celebrities to issue “shares/keys” that give followers access to private group chats Incurring more than $1 million in fees alone, its second only to the Ethereum blockchain and tied with staking service Lido as one of the cryptocurrency services generating the most protocol fees.
A thriving degen spirit in crypto is always a good thing, in a bear market we need more of this energy to sustain the ecosystem, despite a favorable base,Venture capital funding continued to fall toward this years lows in July, a significant decline compared to the same period last year.
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