U.S. New Home Sales, Crude Oil Inventories, NVIDIA Earnings

The US dollar declined against most major currencies on Tuesday, with the USDX down by 0.37%, pressured by softer-than-expected consumer confidence data for February, which ramped up concerns over slowing private consumption. The U.S. economy, heavily reliant on consumer spending, is being challenged by tariffs, persistent inflation, and escalating food costs.

Wall Street saw another negative session on Tuesday with the US 500 which tracks the performance of the S&P 500 declining for the second consecutive day, following a significant drop in consumer confidence, the largest since August 2021. These concerns occurred just before Nvidia's important quarterly earnings report.

In corporate news, Nvidia stock experienced further losses, adding to the previous day's drop, as reports of potential stricter U.S. semiconductor export controls to China weighed on investor sentiment. This decline precedes Nvidia's upcoming earnings report. Tesla's market capitalization fell below the $1 trillion mark following an 8% stock drop, triggered by a reported 45% decrease in European sales. Separately, Home Depot Inc rose by around 3% after reporting fourth-quarter earnings that topped estimates as comparable sales turned positive for the first time in eight quarters.

Crude oil prices fell sharply on Tuesday, with the two main benchmarks WTI and Brent losing 2.46% and 2.41% and hitting two-month lows after weak economic data from the U.S. and Germany ramped up concerns over slowing demand.

Bitcoin and Ethereum, the two main cryptocurrencies by market capitalization, edged lower for a second consecutive session on Tuesday hitting new 2-month lows. The move was mainly attributed to U.S. trade tariff worries and fears of a slowing economy which triggered a shift towards safer assets, causing a decline in cryptocurrencies

For Wednesday, the focus turns to U.S. new home sales, crude oil inventories from the Energy information administration, and quarterly earnings data from NVIDIA. For the week ahead the focus turns to the release of U.S. Preliminary GDP data and Core PCE Price Index. Some price action could also be observed upon the release of U.S. Jobless Claims, U.S. durable goods orders, pending home sales, and the Chicago PMI.

EUR/USD

The EUR/USD pair climbed on Tuesday, supported by a weaker US Dollar (USD) despite renewed fears of a global trade war.

Market sentiment shifted after US President Donald Trump reaffirmed his commitment to imposing 25% tariffs on Canadian and Mexican imports, effective March 4. The tariffs had been delayed by a month after both nations agreed to tighten border security measures.

Looking ahead, key US economic data releases later this week could influence the Greenback’s trajectory. The January Durable Goods Orders report is due on Thursday, followed by the Personal Consumption Expenditures (PCE) Price Index on Friday.

Gold

Gold prices tumbled on Tuesday as traders booked profits following a decline in US Treasury bond yields.

Investor sentiment remains cautious as concerns grow over Trump’s use of tariffs as a negotiation tool.

On the economic front, the latest Consumer Confidence report from the Conference Board (CB) indicated a decline in sentiment, with Americans increasingly wary of the administration’s controversial policies. Additionally, widespread layoffs of federal workers have contributed to consumer uncertainty.

WTI Oil

Oil prices declined by approximately 2% on Tuesday, reaching their lowest levels in two months, as weak economic data from the United States and Germany fueled concerns over slowing energy demand. Additionally, indications of increasing oil production from multiple countries added to the downward pressure on prices.

U.S. economic data revealed that consumer confidence deteriorated in February at its sharpest pace in three and a half years, with 12-month inflation expectations rising.

Meanwhile, Germany’s economy contracted by 0.2% in the fourth quarter of 2024.

Adding further pressure to oil prices, the possibility of a peace deal between Russia and Ukraine has raised speculation about the potential lifting of Russian sanctions, which could allow more Russian crude to re-enter global markets.

Market participants are also closely monitoring U.S. oil inventory data.

US 500

The US 500 declined for a second consecutive session on Tuesday, as a sharp drop in consumer confidence heightened concerns about economic stability. The decline comes just ahead of a key earnings report from Nvidia? later this week, which could influence sentiment in the tech sector.

U.S. consumer confidence fell for a third straight month in February, according to a report from The Conference Board, signaling growing concerns among American households over tariffs, inflation, and the broader economic outlook.

Nvidia shares fell over 2%, extending losses from Monday, when semiconductor stocks were hit by reports that the White House is looking to tighten restrictions on chip exports to China. The new measures could particularly impact Nvidia’s business, adding further uncertainty ahead of its earnings report scheduled for Wednesday after the market close.

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