Geopolitics remain at the forefront of the investment landscape with ongoing conflicts and sanctions (WTI 4.23%, BRENT 3.17%)
Equities remains robust despite fears of overvaluation (NASDAQ 1.74%, S&P500 0.95%)
Bitcoin shoots the lights out (BTC 23.08%)
This week's financial landscape has been marked by a series of critical developments and resounding price action. Notably, BlackRock's chief investment strategist has warned of an inflation rollercoaster, predicting a rebound before a potential fall, driven by wage pressures and global conflicts. This aligns with the sentiment that inflationary pressures are not yet fully behind us, as evidenced by recent actions in China to curb short selling and quantitative trading, aiming to support its struggling stock markets but risking dampened investor appetite.
Accordingly, US 10Y T-bond yields have stalled, with a slight 0.01% decrease over the past week, indicating a cautious approach by fixed income investors amidst a backdrop of all-time high equity markets and mixed economic signals.
The interest rates environment remains a critical factor for investors, with speculation around potential rate cuts in 2024. The Federal Reserve's future actions will be closely watched, as adjustments in monetary policy could significantly impact market dynamics and investment opportunities.
In global geopolitics, the resilience of Russia's economy against sanctions has been highlighted as a lesson for future economic confrontations, underscoring the challenge of isolating a large, globally integrated economy. This resilience, coupled with the West's ongoing efforts to navigate economic sanctions, have seen commodities shift significantly with Gold increasing by 2.26% over the past week, while Silver saw a modest 0.86% uptick. The energy sector as expected were far more sensitive with WTI and Brent crude oil prices surging by 4.23% and 3.17%.
On the corporate front, notable developments include Apple's reported exit from its electric vehicle project, highlighting the challenges even for well-capitalized firms in innovating within new market segments. Furthermore, the tech sector's influence continues to be significant, with US stocks achieving strong gains at the end of February, driven by performance in the Nasdaq Composite and S&P 500.
Cryptocurrencies have continued their surge with Bitcoin and Ethereum posting substantial gains. Bitcoin has soared by 23.08% over the past week, while Ethereum has seen a 17.57% increase, both contributing to their impressive three-month performance of 48.74% and 53.13%, respectively.
“In life and business, there are two cardinal sins. The first is to act precipitously without thought and the second is to not act at all.” -Carl Icahn
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