Sentiments in global markets are cooling today after many days of almost uninterrupted increases in stock indices. What's happening? Primarily, the impact of tariffs on inflation and the economy in the U.S. remains unclear, although it is obvious that there will be one. Financial markets dislike uncertainty. Investors are, for safety's sake, shedding the riskiest assets like Bitcoin or shares of the largest U.S. companies. Recent macro data from the United States has not been kind to investors.
Reasons for the decline - is Nvidia to blame?
News circulated about tightening rules on the use of super-efficient semiconductors in China, which... Indirectly may hit demand for GPUs from Nvidia, which, although not officially going to China - are likely doing so through sales from other Asian chip importers of the world's largest semiconductor company. Declines are particularly visible today in the technology sector.
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Secondly, durable goods orders data unexpectedly rose, although a decline was anticipated. This gives markets room to speculate about a tightening of policy by the Federal Reserve and smaller rate cuts this year. And Wall Street did not like that. To put it bluntly, recent data from the U.S. has not been kind to investors. The S&P 500 is relatively flat, up just 0.3%, but the Nasdaq 100 fell by nearly 0.9% and is battling a two-week average that conventionally separates the bull market from the bear market.
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Additionally, Trump renewed interest in Greenland, indicating that the United States 'must have it.' Fed representative Neel Kashkari called the change in consumer sentiment in the U.S. 'the most dramatic shift in confidence in the last decade, except for the COVID era.' Much of this uncertainty shift relates to tariffs. He also conveyed that the decline in confidence regarding the U.S. economy could have a greater (negative) impact on it than the tariffs themselves.
U.S. Data▶️
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Durable goods orders for February: 0.9% m/m vs -1% expectations and 3.3% in January (revised up by 0.1 pp to 3.3%)
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Durable goods orders (excluding transportation equipment) for February: 0.7% m/m vs 0.2% forecast and 0.1% in January (revised up from 0%)
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Data was presented today by the United States Census Bureau. New orders for manufactured durable goods in February rose by $2.7 billion (0.9%) to $289.3 billion. This reading followed a January increase of 3.3%. Excluding transportation, new orders rose by 0.7%. Excluding the defense sector, new orders rose by 0.8%. Thus, transportation equipment, which has risen for two consecutive months, was the leader in growth, up $1.4 billion or 1.5% to $98.3 billion.
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