Cela's Weekly Insights - January 14, 2024

The first full trading week of 2024 has concluded, offering a blend of excitement and unpredictability. Welcome to the late evening edition of CWI. Across the United States and Europe, markets experienced an uptick from the previous week. Tech stocks, particularly the “Magnificent 7,” showcased their enduring strength.

The Nasdaq 100 is approaching its all-time high of 16,906.80 points, set on December 27, 2023. Meanwhile, the US-Small-Cap-Index Russell 2000 recorded its third consecutive week of losses.

Three key topics stood out this week: persistent US inflation, the introduction of Bitcoin Spot ETFs in the US market, and Taiwan’s presidential election.

Starting with inflation, the consumer price index (CPI) rose 3.4% in December year-over-year, slightly higher than last month’s 3.1%. Core CPI, excluding food and energy, continued its downward trend, reaching 3.9%, the lowest in two and a half years, but still above the Fed's target of 2%.

Moving to Bitcoin, Reuters reports that US Bitcoin ETFs saw $4.6 billion in volume on their first day. Eleven spot Bitcoin ETFs, including notable ones from BlackRock, Grayscale, and ARK 21Shares, commenced trading, igniting competition for market share. While Bitcoin’s performance was positive, it wasn’t as significant as previous months' surges. Interestingly, Ethereum, not Bitcoin, saw the largest increase, likely due to speculation of impending SEC approval.

Last Week's Market Performance: A Global Overview

Lastly, the Taiwanese presidential election drew significant attention. William Lai, the 64-year-old vice president, has led the Democratic Progressive Party (DPP) to an unprecedented third term in a democracy since 1996. The Chinese government’s reported displeasure with Lai, even suggesting potential for conflict, has heightened interest in this development. Analysts have long speculated on deteriorating China-Taiwan relations. However, effective leadership in a democracy requires parliamentary support. Pre-election, the Kuomintang (KMT) party aimed to form a majority with Taiwan People's Party in the Yuan, potentially making Lai's government a minority. As vote counting continues, this development warrants close observation.

That's all for today, folks. For more insights, make sure to join me every weekday morning on my Podcast "Capital Markets Quickie ." Tomorrow morning, we'll discuss the most important events in the week ahead.

Cheerio!

Endrit Cela The Investment Fella - #ECB #mm #411 ??