US stocks finished mostly lower amid a tentative mood ahead of US CPI - Newsquawk Asia-Pac Market Open

US stocks finished mostly lower on what was a relatively indecisive session ahead of the incoming US CPI data with the Russell 2000 the laggard and the Nasdaq was also pressured amid a slide in semiconductors, while Donald Trump's dig at Meta (META) saw the stock tumble although gains in Apple (AAPL) helped cushion the downside. Elsewhere, Bitcoin printed a fresh record high just shy of USD 73k on further financial product euphoria after the LSE confirmed they are to accept Bitcoin and Ethereum ETNs.
USD was marginally firmer but with gains in the DXY capped by resistance near the 103.00 level and after the latest NY Fed SCE spurred very little reaction in which both the 3yr and 5yr inflation expectations raised but the 1yr was left unchanged, while the attention stateside now shifts to the looming US CPI data.
Looking ahead, highlights include Australian Westpac Consumer Sentiment, NAB Business Survey & Building Approvals, Japanese BSI Large Manufacturing & PPI data, Supply from Australia & Japan.

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Highlights include Australian Westpac Consumer Sentiment, NAB Business Survey & Building Approvals, Japanese BSI Large Manufacturing & PPI data, Supply from Australia & Japan.
Click here for the Newsquawk Week Ahead.

US TRADE

US stocks finished mostly lower on what was a relatively indecisive session ahead of the incoming US CPI data with the Russell 2000 the laggard and the Nasdaq was also pressured amid a slide in semiconductors, while Donald Trump's dig at Meta (META) saw the stock tumble although gains in Apple (AAPL) helped cushion the downside. Elsewhere, Bitcoin printed a fresh record high just shy of USD 73k on further financial product euphoria after the LSE confirmed they are to accept Bitcoin and Ethereum ETNs.
SPX -0.11% at 5,117, NDX -0.37% at 17,951, DJIA +0.12% at 38,769, RUT -0.81% at 2,065.
Click here for a detailed summary.

NOTABLE HEADLINES

NY FED SCE (FEB) one-year inflation expectations remained at 3% (prev. 3% in Jan), three-year expectations rose to 2.7% (prev. 2.4%), while the five-year rose to 2.9% (prev. 2.5%).
US Treasury revenue green book said Biden's FY25 budget plan would raise tax receipts by USD 4.951tln over 10 years and the Treasury estimates raising the domestic corporate minimum tax rate to 21% would raise USD 137.4bln over 10 years, while limiting the deductibility of employee income to USD 1mln is to raise USD 271.9bln.

USD was marginally firmer but with gains in the DXY capped by resistance near the 103.00 level and after the latest NY Fed SCE spurred very little reaction in which both the 3yr and 5yr inflation expectations raised but the 1yr was left unchanged, while the attention stateside now shifts to the looming US CPI data.
EUR traded rangebound against the dollar with commentary from ECB's Kazimir and Makhlouf providing little to shift the dial as the former noted the ECB should wait until June for the first rate cut while Makhlouf was pushing for a gradual change in the policy stance.
GBP weakened and briefly dipped beneath the 1.2800 handle against the dollar in a reversal of Friday's firm gains and with the focus in the UK turning to the upcoming employment data.
JPY remained in a tight range with USD/JPY sitting just beneath the 147.00 handle with BoJ watchers awaiting the first tally of the Rengo wage negotiations due later this week, while Japanese press reported many firms are offering big pay hikes in the 2024 Shunto talks.

Treasuries finished with mild losses and the curve flattened ahead of Tuesday's CPI and despite a strong 3-year auction.

Oil prices were choppy and settled flat with firmer-than-expected Chinese inflation data, dollar strength, general risk aversion, and continued geopolitical tensions pushing and pulling the crude complex.

MIDDLE EAST

Israeli reports stated Hamas deputy head Marwan Issa was killed in the shelling of the Nuseirat camp, according to Sky News Arabia.
Ukrainian military intelligence said they are preparing to launch serious offensive operations in Crimea, according to Al Arabiya.
Brussels aims to fast-track EUR 2bln-3bln for Ukraine from frozen Russian assets, according to FT.

OTHER

US intelligence agencies said trade between China and Russia has been increasing since the start of the Ukraine war and China's exports of goods with potential military use rose more than threefold since 2022.
US intelligence agencies said North Korea will expand its weapons of mass destruction capabilities.
China's Defence Ministry said Chinese, Iranian and Russian navies will conduct joint drills between March 11th-15th.

NOTABLE HEADLINES

US State Department said the US must employ all the tools at its disposal to outcompete China wherever possible and it announced USD 2bln to create a new international infrastructure fund which will help compete with China by providing an alternative.
US House is to vote on Wednesday on the bill which will give ByteDance six months to divest TikTok or face a ban, according to the majority leader’s spokesperson.
Japan's Keidanren Chair said they are feeling greater momentum for wage hikes at this year's spring labour talks vs the prior year and there is a high possibility that the BoJ will normalise monetary policy in the near future but doesn’t know if this will occur in March. Furthermore, it was stated that the likelihood of achieving inflation around 2% is increasing and prolonged monetary easing as a "shot in the arm" for the economy is not healthy.
Many Japanese firms are offering large pay increases this year, according to Jiji.

NOTABLE HEADLINES

BoE's Mann said BoE has a long way to go for inflation pressures to be consistent with the 2% target.
ECB's Kazimir said the ECB should wait until June for the first rate cut and rushing a move is not smart or beneficial, while he added that upside risks to inflation are "alive and kicking". Furthermore, he said they need more hard evidence and only in June will the confidence threshold be reached, as well as noted that discussions on easing should already start and the ECB will use the weeks ahead of that.
ECB's Makhlouf said a gradual change in the policy stance is the best way of adjusting, rather than a sudden decision, and large individual cuts are probably unlikely because data is never that definitive.
ECB is leaning against any immediate change in the amount of money that lenders need to park with the ECB interest-free, which currently removes the threat of an impact on bank profitability, according to Bloomberg sources. Furthermore, it was noted that the push by hawks to increase the Minimum Reserve Requirements (MRR) from the current 1% has struggled to gain momentum, although no decision has yet been taken and officials haven’t ruled it out for the future.