Equity markets broadly fell on Tuesday as bond yields started to reverse higher, which put pressure on technology companies. Other sectors remain resilient, but a cautious outlook remains.
It also comes at a time when Fed Vice Chairman Barr testified before Congress on the banking turmoil. At the heart of the issue is the concern that depositors had pulled large sum of deposit out of small banks, causing financial intuitions to have to sell their assets at a loss to shore up their liquidity. Despite the swift effort by the regulators, Silicon Valley Bank still collapsed and was purchased by First Citizens. At the same time, the Fed announced a flood of liquidity for regional banks to control the emotional contagion effect.
Alibaba knocking on the door
Shares of the e-commerce giant rose sharply on Tuesday after the announcement of plans to split its business into six units to help unlock values in its business units. This helped to push shares higher by over 10%.
It comes at a time when rumour raised and later confirmed that Jack Ma is back in China, but there are few signs that he will return to any form of executive role within the organisation.
The latest move helps expand the prowess and talent pool attraction of Alibaba as talents may be more hesitant to join the company due to the past 3 years of an intense regulatory crackdown that hurt employment sentiments.
Moreover, while retaining the collaborative culture, leaner business units allow quicker decision-making and enforce financial prudence, allowing core business units to flourish in a more challenging macroeconomic environment. This includes the potential for fundraising for each unit.
What’s on the menu today?
At 10 pm, we will have the Pending Home Sales data, which we expect a decline of 2.3% for the Fed compared to a growth of 8.1% in the prior period.
It is a data-light week, as eyes are now focused on Friday’s PCE inflation reading.
It is 29 March, Wednesday, 8.35 am in Singapore and 8.35 pm in New York. As the market remains sideways towards the end of the month, I have seen more resilience in major indices, and hopefully, we can have a prosperous closing for the month.
From your lovely trading buddy.
More Stories
Markets in risk-on mode with year end rally on track.
Consumer Discretionary Stocks Lead Losses, Hinting at Recessionary Concerns
All is well.