SIGNIFICANT INFLOWS
CoinShares has reported that there was a significant increase in global Bitcoin funds with a total of $148 million in investments last week, while short Bitcoin products saw outflows of $3.5 million. In addition, Ethereum funds also saw positive inflows of $33.5 million, marking the second consecutive week of gains after a long period of minimal activity. Besides, this surge in interest in Ethereum also positively impacted Solana, which received $5.8 million in investments amidst speculation about potential Solana ETFs and other altcoin products. Moreover, it is worth noting that while most of these investments came from the U.S., there were also notable crypto investments in Canada and Switzerland, where Ethereum enjoys strong institutional support alongside Bitcoin. Furthermore, experts are predicting that Ethereum ETFs could launch in July, capturing approximately 20% of the demand observed for Bitcoin ETFs, which could still be considered a highly successful launch.
PAUSED TRADING
A technical issue on the New York Stock Exchange caused a disruption in trading on yesterday morning, resulting in inaccurate stock prices and volatility halts for multiple securities, including Warren Buffett’s Berkshire Hathaway (BRK-A) A-shares witnessing a stunning 99.9% drop in price. The problem was traced back to a technical glitch involving industry-wide price bands managed by the Consolidated Tape Association’s Securities Information Processor, prompting trading halts on approximately 40 symbols listed on NYSE Group exchanges. These price bands are designed to prevent excessive fluctuations in stock prices and ensure smoother trading. Fortunately, the issue was promptly addressed, and trading for the affected stocks resumed, bringing back stability to the market.
RALLY SLOWED DOWN
The recent global bond rally influenced by signs of economic weakness in the U.S., seems to have tapered off as the market awaits the release of the report which will reveal the condition of the U.S. labor market. Analysts are projecting a slowdown in hiring for the month of April, and although there was a recent sell-off in the market, investors remain cautious as yields remain relatively high. Furthermore, it is important to highlight that the market is grappling with unexpected inflation rates, which are casting doubt on the extent to which borrowing costs can be lowered by policymakers this year. Moreover, as the U.S. economy is slowing down compared to other developed economies, U.S. Treasuries an attractive investment option. In particular, U.S. inflation-protected bonds are being favored for their relatively attractive pricing. Additionally, the declining oil prices are further enhancing the appeal of bonds following the concerns surrounding oversupply.
OIL MARKET TURBULENCE
U.S. crude oil has experienced a nearly 2% decline, reversing most of its year-to-date gains, following the announcement by OPEC+ to increase production starting in October. This marked the fifth consecutive session of losses for U.S. crude, with the July contract plummeting by 3.6% on Monday after the OPEC+ meeting. Current energy prices show West Texas Intermediate at $72.90 a barrel, down $1.32, and Brent crude at $77.14 a barrel, down $1.22. Gasoline prices also saw a decrease, with RBOB Gasoline at $2.30, down by 1.12%. Natural Gas, on the other hand, experienced an increase to $2.80, up by 1.74%. The market reception to the detailed plan by top oil producers, including Saudi Arabia and Russia, to gradually phase out production cuts has been negative, with concerns about economic growth looming. Analysts have highlighted the bearish sentiment in the market due to the announcement, however, it has also been noted that the downside in oil prices could be limited if summer gasoline demand remains strong, and the recent selloff may help alleviate global inflationary pressures.
INTERNATIONAL NEWS
European markets have experienced a downturn as the previous positive momentum began to wane, with the pan-European Stoxx 600 index declined by 0.64%, and all major stock exchanges and the majority of sectors showing losses. Notably, mining stocks saw a significant drop of 2.3%, while banking shares suffered a 2.1% decrease, with prominent institutions like Italy’s UniCredit and Spain’s BBVA facing losses exceeding 4% ahead of the European Central Bank’s looming interest rate decision. Nonetheless, not all was a setback as Maersk, which is a key player in the shipping industry, experienced a surge in its share price after revising its full-year profit forecast upward due to robust market demand and persistent disruptions in the Red Sea region. Moreover, looking ahead, investors are eagerly awaiting the European Central Bank’s meeting this Thursday, with expectations of an interest rate cut – the first since 2019. However, it is very important to remark that concerns have been raised with the news of a higher-than-expected increase in German unemployment figures for May, and this may have an effect on ECB’s decision.
