Today’s Outlook :
• US MARKET : U.S. stocks ended in the red on Friday, as continued weakness in the technology sector along with hotter-than-expected producer inflation data weighed on sentiment. Wall Street also slid to its worst monthly performance since March last year. The benchmark S&P 500 index fell 0.5% to close at 6,877.36 points, the tech-heavy NASDAQ Composite shed 0.9% to settle at 22,668.21 points, and the blue-chip Dow Jones Industrial Average slid 1.1% to conclude at 48,977.18 points.
Nvidia the most valuable company in the world, was the biggest weight on Wall Street on Thursday, sliding over 5% despite logging bumper quarterly earnings. On Friday, Netflix was in the spotlight, soaring around 14% after the streaming giant said it will not raise its offer for Warner Bros Discovery. This was after Warner determined an upgraded, USD 31 a share offer from Paramount Skydance was the superior proposal. Paramount stock jumped almost 21%, while Warner was down about 2%. Netflix said that with the price required to match Paramount’s latest offer, the deal was “no longer financially attractive.”
On the economic calendar, January’s producer price index ticked up 0.5% M/M and 2.9% Y/Y, both higher than the consensus figures of 0.3% and 2.6%, respectively. Meanwhile, core PPI, which excludes energy and food prices, rose 0.8% M/M and 3.6% Y/Y, compared to estimates of 0.3% and 3.0%.
• EUROPEAN MARKET : European stocks traded in a mixed fashion on Friday, as investors digested more regional corporate earnings as well as key inflation data at the end of a busy week. The DAX index in Germany traded 0.1% higher, the CAC 40 in France slipped 0.5% and the FTSE 100 in the U.K. gained 0.6%.
• ASIAN MARKET : Most Asian stocks fell on Friday with technology shares tracking overnight weakness in their Wall Street peers, although bourses in South Korea and Japan were headed for strong gains in February.
South Korea’s KOSPI was the worst performer in Asia on Friday, falling as much as 2% from recent record highs on some declines in tech. Chipmaking majors Samsung Electronics Co Ltd and SK Hynix Inc fell 0.9% and 2.6%, respectively, also falling from record highs. But index heavyweight Hyundai Motor was an outlier, rising 2.5% to a record high after it agreed to invest about 9 trillion won in an artificial intelligence data centre and robot factory in the country. The KOSPI has been a major beneficiary of AI-linked hype, with a bulk of its tech and industrial constituents viewed as potential winners from the nascent technology. The index was set to rise nearly 20% this month and was by far the best performer in Asia.
Japan’s Nikkei 225 index fell 0.2% on losses in local tech shares, while the broader TOPIX index jumped 0.8%. Consumer price index data from Tokyo showed inflation in Japan’s capital cooled in February, with core inflation also falling below the Bank of Japan’s 2% annual target. The print usually acts as a bellwether for national inflation, with Friday’s data pointing to more potential reassessments of the BOJ’s plans for rate hikes. This notion boosted domestically exposed stocks, especially as Prime Minister Sanae Takaichi prepares to dole out more fiscal stimulus.”
• US & IRAN AGGRESION AGAINST IRAN: The U.S. and Israel launched a wave of strikes against Iran over the weekend, killing hundreds, including Supreme Leader Ayatollah Khamenei and several top officials in the country. Iran had retaliated by launching missile strikes at Israel and several other Middle Eastern countries with U.S. ties, including Bahrain, Kuwait, Qatar, and the United Arab Emirates. Iran was also seen attacking several ships passing through the Strait of Hormuz, likely heralding near-term disruptions in oil markets. U.S. President Donald Trump said on Sunday evening that military action against Iran was set to continue in the coming days, while also warning that more American military personnel will likely be killed. All eyes were on the Strait of Hormuz where around a fifth of the world’s seaborne oil trade flows and 20% of its liquefied natural gas. While the vital waterway has not yet been blocked, marine tracking sites showed tankers piling up on either side of the strait wary of attack or maybe unable to get insurance for the voyage.
• COMMODITIES: OIL: Oil prices surged more than 8% to their highest in months on Monday as Iran and Israel stepped up attacks in the Middle East, damaging tankers and disrupting shipments from the key producing region. Brent crude futures struck a high of USD 82.37 a barrel and was at USD 79.34, up USD 6.47, or 8.88%, by 2305 GMT. U.S. West Texas Intermediate crude jumped USD 5.36, or 8%, to USD 72.38 a barrel after touching a high of USD 75.33 earlier. Israel launched a new wave of strikes on Tehran on Sunday and Iran responded with more missile barrages, a day after the killing of Supreme Leader Ali Khamenei pitched the Middle East and the global economy into deepening uncertainty. At least three tankers were damaged off the Gulf coast and one seafarer was killed as Iranian retaliation for U.S. and Israeli strikes on Iran exposed ships to collateral damage, shipping sources and officials said on Sunday.”
• INDONESIA : The Jakarta Composite Index (JCI) closed with a hammer doji, closing relatively flat at 8235.5, as the market remained in a wait-and-see mode due to concerns about outflows from the MSCI rebalancing and concerns about Indonesia’s fiscal situation. Today, the market appears poised for a correction in the first session, with oil-based stocks and tanker companies likely to rise today in the first session amid US and Israeli aggression against Iran. Stick to commodity stocks, which will be a trading theme throughout this year, along with the rise in oil, gold, and nickel. Always be vigilant with stop-loss and trailing stop orders amid this volatility.
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