Its Over, page-20751

Market highlights


ASX futures down 13 points or 0.2% to 7659 near 7am AEDT

• AUD -0.3% to 65.60 US cents
• Bitcoin -3.5% to $US68,204 at 8.25am AEDT
• On Wall St at 4pm: Dow -0.5% S&P -0.7% Nasdaq -1%
• In New York: BHP -0.7% Rio +0.2% Atlassian -4.1%
• Tesla +0.7% Microsoft -2.1% Apple -0.2% Nvidia -0.1%
• Alphabet -1.5% Amazon -2.4% Meta -1.6%
• Super Micro -5.5% Crowdstrike -3.9% AMD +2.1%
• VIX +0.1% QQQ -1.2% TLT -0.03%
• Stoxx 50 -0.1% FTSE -0.2% DAX -0.03% CAC +0.04%
• Spot gold -0.3% to $US2155.90/oz at 4.59pm in New York
• Brent crude -0.1% to $US85.31 a barrel
• Iron ore -3.5% to $US99.60 a tonne
• 10-year yield: US 4.31% Australia 4.13% Germany 2.44%
• US prices as of 4.59pm in New York

Iron ore’s bearish 2024

The spot price of iron ore traded in Singapore closed below $US100 a tonne to its lowest in more than seven months, taking the year-to-date drop to more than 26 per cent.

In a note, Liberum Capital’s Tom Price said “we’re usually constructive on iron ore’s demand and price outlook during December to May, sometimes even short-term bulls” but not this year.

Mr Price said the slide to start 2024 “is now looking weaker” than a year ago. While industry checks confirm a “downbeat mood”, he said the sell-off has been more bearish than expected.

“There’s no corresponding shift in trade, inventories or steel output rates,” Mr Price said. “It follows that we suspect speculators are withdrawing; not even waiting” for Chinese steel mills to complete their seasonal restocking in May.

The spot price for iron ore slid 3.5 per cent to $US99.60 a tonne in Singapore on Friday, to end the week 13.5 per cent lower. It ended 2023 at $US135.31.

An ugly week on the macro side - hotter than expected inflation, slower than expected growth, weaker than expected labor market data...

Source: Bloomberg

...but the inflation issues sent rate-cut expectations reeling (now less than 3 cuts priced in for 2024)...

Source: Bloomberg
And as rate-cut expectations fell, Treasury yields rose... non-stop... all week with the belly of the curve underperforming (5Y yields up 28bps on the week)...

Source: Bloomberg
Yields all ended back up near their year-to-date highs...

Source: Bloomberg
Higher yields were initially shrugged off by stocks but as they kept rising, there was no arguing...

Source: Bloomberg
Small-Caps and Big-Tech were the week's biggest losers...

Banks were not pretty this week as The Fed's BTFP facility expired...

...and liquidity was sucked hard out of the RRP. $108BN drawn down in the last two days to fresh cycle lows...

Source: Bloomberg
Anti-Obesity drug stocks dared to end red...

Source: Bloomberg
AI stocks also pumped and dumped on the week...

Source: Bloomberg
The dollar surged this week - as BoJ chatter picked up - with its best week since mid-Jan (rebounding some from last week's dollar-plungefest)....

Source: Bloomberg
The dollar's gains were gold's losses as the precious metal ended the week down 1%...

Source: Bloomberg
Despite big net inflows this week...

Source: Bloomberg
...bitcoin ended the week only marginally higher (up around 3%), with choppy moves (day-session dips bought overnight), but ened back above $70,000...

Source: Bloomberg
...and ethereum was a little worse, down around 3%, on the week (thanks to Democrats' letter overnight pressuring the SEC on ETH ETFs)...

Source: Bloomberg
NatGas erased most of last week's gains...

Source: Bloomberg
Still there were some bright spots...
Crude surged on the week, breaking out of its range to its highest since early November...

Source: Bloomberg
And as goes crude, so goes wholesale gasoline... and then goes pump prices...

Source: Bloomberg
..but it was copper that really regained its legs, surging up to its highest since Feb 2023...

Source: Bloomberg
Finally, was this week's 'stalling' in NVDA 'the top'?

Source: Bloomberg
How ironic would it be if we saw peak AI just as Jensen unveils his latest and greatest at GTC on Monday?