STOCKS

Earlier in the week, US stocks slid after a report showed that the U.S. economy grew a touch slower in the fourth quarter than earlier estimated. On Thursday, equities advanced to finish February on a positive note, with Nasdaq rising to its first closing record since November 2021. The tech-heavy index added 0.90% to close at an all-time high. The S&P 500 rose 0.52% to see a record close as well. The Dow Jones gained just 0.12% to add 2.22% for its first four-month winning streak in nearly three years. Investors cheered the report that suggested PCE inflation didn’t exceed estimates in January. Elsewhere, the Shanghai Composite index added 0.39% even as fresh data out of China showed that manufacturing activity contracted for the fifth consecutive month in February. In Europe, Germany’s DAX 30 added 0.42% after hitting a fresh all-time high in the previous session. Regional investors are now shifting their focus towards next week’s ECB meeting.

CURRENCIES

The US dollar holds steady on Friday after three sessions of gains. The USD index is back above the 104.00 figure but is yet to confirm the breakout on a daily and weekly closing basis. On the upside, the 104.25 zone represents the immediate resistance at this stage, while the nearest support arrives in the 103.80 region, followed by this week’s lows around 103.60. The overall bullish trend surrounding the greenback remains intact due to strong economic data in combination with more hawkish Fed. Fresh data showed that headline PCE increased 0.3% monthly and 2.4% on yearly basis, in line with estimates. Personal income rose 1% month-over-month in January, well above the forecast for 0.3%, keeping alive the chance of the Federal Reserve cutting rates in June. In general, the incoming data emphasize the need for the FOMC to be cautious before beginning to normalize interest rates. Markets are pricing in a 65% chance of the Fed cutting rates in June.

OIL

Oil prices are set to finish the week with gains, staying within a relatively tight trading range these days. Earlier in the week, Brent crude briefly peaked at $84.30 for the first time since late January, but failed to preserve gains and has retreated partially since then. Oil traders are fairly optimistic in anticipation of OPEC+ decision. The alliance is widely expected to extend its production cap deal, tightening supply further. The decision on extending production cuts is expected in the first week of March. In other industry news, the EIA report this week showed that US crude oil inventories rose by 4.2 million barrels in the week ending February 23. On the positive side, gasoline stocks fell by 2.8 million barrels, while distillate stockpiles were down by 510,000 barrels, versus expectations for a 2.1-million-barrel drop. On the other hand, data from China, the world’s largest oil consumer, capped positive momentum in the oil market as the country’s manufacturing activity continued to contract for the fifth consecutive month. A weak release added to demand concerns among oil traders.

GOLD

Gold prices continued the ascent from two-month lows registered below the $2,000 psychological level in February. The precious metal extended gains to the $2,060 zone that has been capping the rally so far. On the weekly charts, the XAUUSD pair trades slightly positive. In a wider picture, gold looks relatively steady, with downside risks limited while above the $2,000 figure. After peaking at record highs in December, gold looks resilient, but lacks the momentum to retarget the peaks registered around $2,150. On the monthly charts, XAUUSD needs to climb above the $2,060 region in order extend the rally. However, a sustained and decisive breakout looks unlikely at this stage, especially as Fed rate cut expectations continue to wane amid solid economic data and stubborn inflation. On the downside, the nearest support now arrives at $2,030, followed by the $2,015 intermediate barrier on the way to the $2,000 psychological level last seen in mid-February.

CRYPTO

The price of bitcoin has exited its consolidation mode to make a decisive breakout this week. The BTCUSD pair has been rallying aggressively these days. In the process, the coin exceeded several resistance levels to climb to November 2021 highs around $63,800. After the latest spike, BTC has settled slightly above $62,000, retaining positive bias on Friday after yesterday’s local retreat. One of the key reasons behind the current rally is the upcoming halving event due in mid-April. Bitcoin halving, which happens every four years, has traditionally been associated with rising prices. After the event, reward miners get will be halved from 6.25 bitcoin to 3.125. Also, euphoric sentiment in the cryptocurrency market is due to renewed interest in the cryptocurrency after the U.S. approved the first bitcoin spot ETFs. Adding to an upbeat tone in the cryptocurrency market, MicroStrategy revealed earlier in the week that it has bought this month 3,000 bitcoin for $155.4 million. Since the start of the year, bitcoin has risen more than 30% to rise add over 12% this week.