Stocks couldn’t hold their gains yesterday, though they’re trying to stabilize (again) in the early going today. Gold and silver are selling off along with crude oil, while Treasuries are rallying strongly. The dollar is down a bit.
Chipmaker Nvidia Corp. (NVDA) reports quarterly earnings tomorrow after the bell, a closely watched event that could help improve semiconductor sentiment. Investors could use it, especially today with the sector selling off further on fears of tighter Trump Administration export restrictions. Officials are trying to stop China from importing as much high-end chip-making and Artificial Intelligence (AI) technology. The VanEck Semiconductor ETF (SMH) has lost almost 7% in the last month.
Meanwhile, Bitcoin is giving up a chunk of its recent gains – dropping almost 8% and taking out $90,000. A broader index of cryptocurrencies is in the midst of its worst four-day streak since August. Some of the air is clearly coming out of the “Crypto President” rally that followed Trump’s election.
NVDA, SMH, IBIT (YTD % Change)
Bitcoin also tends to trade in parallel with red-hot tech stocks, which have been shedding gobs of points in the last week. A $1.5 billion hack that may have originated in North Korea has also soured sentiment. After being up as much as 10% in early 2024, the iShares Bitcoin Trust ETF (IBIT) was back to flat as of yesterday.
Don’t look now, but interest rates are falling...yes, FALLING. The yield on the 10-year Treasury Note just slipped to 4.33%, its lowest since mid-December. Weakness in equity markets and some squishiness in the economic data is leading investors to rotate into government bonds. Rate futures markets are also now back to pricing in two 25-basis point Federal Reserve interest rate cuts, up from one not too long ago.
Lastly, the crafts and fabric retail chain Joann is throwing in the towel. The company filed for bankruptcy twice in the last year – and rather than reorganize, this time it is liquidating. The Ohio-based chain will sell off the remainder of its assets and shutter all of its 800 stores, ending an 80-year run of operations.
