RECORD STREAK ENDED

U.S.-listed bitcoin ETFs saw a record 19-day streak of net inflows come to an end with $65 million in combined outflows. Grayscale’s GBTC led the outflows with $40 million, continuing its trend as the worst-performing ETF with $18 billion in total outflows since January. Other ETFs like Invesco, Galaxy Digital, Valkyrie, and Fidelity also experienced net outflows. These outflows coincided with a market-wide slide in the cryptocurrency market and broader stock markets. Moreover, as a result of this, Bitcoin, which briefly reached over $70,000 last week, has since declined by over 2% within the past 24 hours.

STILL FALLING

Apple’s shares have slipped for the second day in a row after its much-hyped AI announcement failed to deliver any major surprises, unveiling a new platform dubbed Apple Intelligence. The company is racing to keep pace in the thriving AI market, with their partnership with OpenAI, in development for months, only briefly touched upon at the event. The announcement also sparked controversy as Elon Musk stated he would ban Apple products from his companies if OpenAI’s software becomes integrated at the operating system level, underscoring the fierce competition and high stakes present in the rapidly expanding AI sector. This represents Apple’s bold move to assert its position among its competitors in the AI landscape, fueled by the need to innovate and stay ahead in a market that holds immense potential for growth and technological advancement.

LARGE-CAPS TAKE THE LEAD

This year’s stock market rally, large-cap stocks have been leading the way. According to Bespoke Investment Group the S&P 500’s performance this year and found that the top 50 largest stocks in the index have outperformed the broader market. This shift towards large-cap stocks coincides with investors’ reduced expectations for Federal Reserve interest rate cuts due to steady inflation reports. Large-cap stocks have proven to be more resilient to higher interest rates, with robust earnings growth driving their performance. On the other hand, small-cap stocks have struggled to keep up. Chief Investment Officer Mike Wilson from Morgan Stanley has expressed skepticism about the outlook for small-cap stocks, citing higher rates as a hindrance. Overall, the focus on large-cap stocks is supported by the belief that they will continue to outperform, driven by strong earnings growth and economic expansion.

TURMOIL SPARKED FEARS

Amid escalating political turmoil in Europe, investors are turning to safer assets, with US Treasuries gaining ground as uncertainty grows. European stocks are on a downward trend, while US futures and the euro are weakening against a stronger dollar. French bond yields have surged, fueling speculation about President Macron potentially resigning if his party performs poorly in upcoming elections. Macron has reassured the public that his position remains secure, but the outcome of the elections could challenge his economic policies that have reassured investors since taking office in 2017. If far-right rivals lead France’s parliament, it may expose the country’s fragile fiscal situation and impact the euro’s stability. Analysts warn that French politics could contribute to a prolonged period of weakness for the euro. The upcoming elections represent a critical moment for European markets and may have lasting effects on economic policies and the currency’s value.

SHARP RISE

Oil prices experienced a significant increase, marking the largest jump since March, ahead of the release of an OPEC report that will offer insights into the current market outlook. Following a notable surge experienced yesterday, crude oil saw a resurgence as traders reentered the market, rebounding from the previous week’s substantial losses, which were the most significant since early May. This upward trend in oil prices is expected to be further influenced by upcoming reports, including a Short-Term Energy Outlook from the U.S. scheduled for release later today, as well as a monthly update from the International Energy Agency set for tomorrow. Investors and industry experts will closely monitor these reports for valuable information that could impact oil prices and market dynamics in the coming days. These reports will serve as key indicators for understanding the current state of the energy sector and predicting future trends in the oil market.