💻Tech is back in the game💎

Equity market roses firmly on Monday as there is renewed confidence that a slower pace in interest rate hikes from the Fed is on the cards, which could help engineer a soft landing or a mild recession. The Dow rose by 0.8%, while the S&P 500 jumped 1.2%. Nasdaq is the biggest winner after mooning 2%. 

Key semiconductor counters were the shining stars of the day, such as AMD and MRVL, which closed significantly higher, giving Nasdaq a push as investors shift geat towards growth stocks during possible early end to interest rate hike that often hurt this group of stocks last year. 

Indeed, based on several speakers we heard since last week, they are open to further moderating the rate hikes from 0.5% to 0.25% as they digest more evidence of inflation taming. Investors are baking almost 99% that the upcoming February rate hike will be 0.25%. Any surprises could put a cold blanket on this brief rally. 

💵Is Bitcoin trying to have a new bull market?❤️

Bitcoin and other cryptocurrencies moved higher over the weekend and have been trying to continue their uptrend. It had hit above $23,000, a significant milestone, while pulled back moderately. It also comes when there is a general risk-on sentiment after the shock incurred by FTX’s downfall. 

As most investors agreed, Bitcoin has positive correlations between risk-on factors. As a result, it has generally moved higher in tandem with the equity market as signs of inflation waning boost appetite for higher investment growth areas. 

📪What’s on the menu today?📈

At 10.45 pm, we will have the Manufacturing PMI data, which we expect a further decline to 46.0 from 46.2 in the prior period. 

Service PMI data will be released at the same time. On the contrary, we should see a modest uptick to 45.0 from 44.7 in the previous period. 

A decent number while still showing contraction will help to alleviate the fear of a deep recession while paving the way for more time to allow inflation to cool down. This will be the delicate balance equity markets are hoping for. 

It is 24 January 2023, Tuesday, 10.45 am in Singapore and 9.45 pm in New York. As we move into a good year, let’s hope for the rally to continue. Have a prosperous celebration, too, friends of Pika World!