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APRIL 1, 2024

LTC SKYROCKETED

Litecoin (LTC) has surged significantly, emerging as the second-best performing cryptocurrency in the top 100, a in the past week, Litecoin’s price has soared by 24%, surpassing the $100 mark. This rise can be attributed in part to the U.S. Commodity Futures Trading Commission (CFTC) classifying Litecoin as a commodity in a lawsuit against the crypto exchange KuCoin. This means that Litecoin can now operate outside the Securities and Exchange Commission’s (SEC) jurisdiction, which potentially eases regulations for the digital asset. As a result, Litecoin is currently trading at $110.25, which marks its second best-performing day this year after an 18.7% spike on March 11, and it is worth highlighting that LTC has experienced a notable 31.7% surge in the last 30 days.

GOLD RISING WAVE

Following the release of the latest PCE index report, gold prices have continued to their upward momentum reaching record highs. As stated by Jerome Powell, February’s inflation data is more in line of what the Federal Reserve wants to see in order to cut rates. Therefore, although many expect the Fed to hold rates in May, many see a rate cut happening in June. Consequently, as the decrease in interest rates tend to reduce the opportunity cost of holding gold, more investors have been attracted to invest in gold, ultimately raising its price. Moreover, gold prices have also been driven up by other factors such as safe-haven demand and current geopolitical tensions. Furthermore, it is worth noting that gold has seen a rise of over 9% this year due to growing rate cut expectations and central bank purchases, and prices have hit all-time highs in various currencies including euros, yuan, Indian rupees, and British pounds. Nonetheless, despite the upward momentum, the market environment is currently low in liquidity due to Easter Monday, which may lead to price reversals when participation levels increase later in the week.

ACTIVE EMERGING ETFs

Investors are currently increasingly being drawn to actively managed exchange-traded funds (ETFs) specializing in emerging markets as they seek out undervalued opportunities in the global stock market. Despite only accounting for 5% of the $348 billion market for ETFs investing in developing nations, these actively managed funds have captured more than a third of new investments over the past year, and over 50% in the last month. The allure of emerging markets stems from their substantial discount of about 43% compared to U.S. stocks, presenting a prime chance for investors to tap into underpriced assets. Notably, funds like AVEM have exhibited strong performance by surpassing benchmarks while offering lower fees than industry norms.

INTERNATIONAL NEWS

In March, China’s factory activity surpassed expectations, signaling optimism about the country’s potential to reach its growth target of around 5% this year. The Caixin manufacturing purchasing managers’ index climbed to 51.1, indicating expansion for the fifth consecutive month, the longest streak in over two years. In addition, latest government data revealed that the manufacturing PMI rebounded from a five-month contraction to reach its highest level in a year, exceeding market forecasts. These positive numbers provide further evidence that China’s industrial sector is gaining momentum for an economic rebound, as reflected in the 1.5% increase in the CSI 300 Index and a 1-basis point rise in 10-year government bond yields in Shanghai. Furthermore, the PMI reports, released monthly as an initial gauge of the world’s second-largest economy’s health, suggest that economic recovery accelerated in March, bolstered by strong industrial output and export data from the first two months of the year. Moreover, it is worth noting that despite a property crisis, declining consumer confidence, and geopolitical tensions, the industrial sector stands as a beacon of hope, according to Jacqueline Rong, chief China economist at BNP Paribas SA, who noted that industrial activity may have strengthened in March even when seasonal factors are considered.

KEY EVENTS HAPPENING THIS WEEK

Monday: Construction spending report for February, final S&P U.S. manufacturing PMI and ISM manufacturing reports for March, and speech from Fed Governor Lisa Cook.

Tuesday: Factory orders and job openings reports for February, U.S. auto sales report for March, and speeches from Cleveland Fed President Loretta Mester and San Francisco Fed President Mary Daly.

Wednesday: ADP employment, final S&P U.S. services PMI and ISM services reports for March, and speeches from Fed Governor Michelle Bowman, Fed Chair Jerome Powell, Fed Vice Chair for Supervisions Michael Barr, Fed Governor Adriana Kugler.

Thursday: U.S. trade balance report for February, initial jobless claims for week ending on March 30, and speeches from Philadelphia Fed President Patrick Harker, Richmond Fed President Tom Barkin, Chicago Fed President Austan Goolsbee, Cleveland Fed President Loretta Mester, Minneapolis Fed President Neel Kashkari and Fed Governor Adriana Kugler.

Friday: U.S. nonfarm payrolls, unemployment rate and consumer credit reports for March, and speeches from Richmond Fed President Tom Barkin, Dallas Fed President Lorie Logan and Fed Governor Michelle Bowman.

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