3.4.24: Services Inflation Remains Sticky as Goods Inflation Retreats

For Public Readers: Weekly Key U.S. and China brief market notes by Larry Cheung's Analyst Staff Team for our Public Email List

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Mar 04, 2024

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In our emails, we will provide the following coverage points:

Brief Overview of U.S. & China Markets
Macro Chart in Focus
U.S. & China Upcoming Economic Calendar
Chart That Caught Our Eye

U.S and China Markets Brief Snapshot 🇺🇸 🇨🇳

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S&P 500 Index:

KWEB (Chinese Internet) ETF:

Analyst Team Note:
On average since 1929, 5% pullbacks have occurred 3x/yr and 10% corrections have occurred once per year. It’s been around four months since we’re seen any meaningful decline.
The VIX has increased by 25% from Q2 to November of prior presidential election years. But postelection day, returns have generally been positive from the removal of uncertainty

Macro Chart In Focus

Analyst Team Note:
The Bank for International Settlements (BIS) warns that inflation may remain stubbornly high as the services sector becomes its primary driver, with prices in this sector less affected by lower energy costs and more influenced by higher labor intensity, making services inflation more persistent.
This shift in inflation's driving forces poses a challenge for central banks, which might need to maintain tighter monetary policies to meet inflation targets, especially as the pandemic has disrupted the balance between goods and services prices.

Upcoming Economic Calendar

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U.S Economic Calendar (Upcoming Data Points)

China Economic Calendar (Upcoming Data Points)

Analyst Team Note:
China is poised to set its 2024 economic growth target and unveil strategies to support its slowing economy at the upcoming National People's Congress (NPC), with expectations of maintaining a growth target around 5%.
The focus will also be on addressing the property market downturn, boosting consumption, and fostering new growth sectors like electric vehicles and renewable energy.

Chart That Caught Our Eye

Analyst Team Note:
Traders are increasingly optimistic about Bitcoin's potential to surpass its 2021 record high. The open interest for short-dated call options that expire on March 29 with strike prices of $70,000, $75,000 and $80,000 has climbed in the last 24 hours.