🔪 No rate cuts?

Good morning investors! Bitcoin momentarily jumped over $64,000 over the weekend helping crypto total market value cross the $2.5 trillion mark.

Today we cover:

• Inflation means no rate cuts in 2024?

• Stock hitting new highs.

• Intro to ETFs.

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📊 Economy and News 

No rate cuts in 2024?

Torsten Slok, chief economist at Apollo Global Management, thinks that the Fed will not cut rates this year.

Surprisingly, he isn’t the only one with this opinion.

Richmond Federal Reserve President Tom Barkin echoed the idea that the central bank may not cut interest rates this year.

“We’ll see,” Barkin said in an interview with CNBC on Friday morning.

He thinks it will be a while before inflation is down enough to warrant rate cuts.

But why? Because the economy is too strong.

Economists expect US real GDP to grow by 2.4% this year, up from their forecast of 1.5% in November.

We also have a strong labor market. Plus, unemployment is at historic lows while wage inflation remains high.

On the other hand, small businesses are looking to raise prices soon.

This means that inflation will continue to be a problem in 2024, resulting in no cuts.

“The bottom line is that the Fed will spend most of 2024 fighting inflation,” said Slok.

But, not everyone has given up and a large percentage still see a rate cut in the mid of the year. There is hope and some believe that a bigger pool of American workers could continue to slow inflation even further.

Investors will closely monitor Powell's testimony to the House Financial Services Committee on Wednesday and the Senate Banking Committee on Thursday for insights into expectations regarding potential rate cuts.

Global hits:

• Immigration is ‘taking pressure off’ the job market and U.S. economy, expert says.

• India approves three chip plants with over $15 billion in investments to realize semiconductor ambitions. Moreover, India’s Byju’s has lost more than $20 billion in valuation.

• Short positions in China stocks shrink after regulatory crackdown. However, China’s factories are sending mixed signals about the economy as property developer Country Garden faces liquidation petition.

Just in: Oil prices slip after OPEC+ extends voluntary oil output cuts until mid-year. Plus, Japan’s Nikkei smashes 40,000 barrier after Wall Street benchmarks hit record highs.

📈 Stocks

S&P 500 5,137.08 (+0.80%)
DJIA 39,087.38 (+0.23%)
NASDAQ 18,302.91 (+1.44%)
BRENT CRUDE 8354 (-0.02%)
* Prices as of Mar 4th, 12:20 AM UTC

Stocks hitting new highs

The Nasdaq Composite hit an all-time high on Friday, breaking its 2021 record, as investors continued to show interest in tech stocks.

Nvidia continued to spearhead the tech rally with a remarkable 260% surge over the past year after rising another 4% on Friday. Meta also experienced a notable increase, jumping more than 2% for the day.

Over the week, the Nasdaq gained 1.74%, and the S&P 500, which reached a record high close on Thursday, rose by 0.95%. Both indexes marked their seventh positive week out of the last eight. In contrast, the 30-stock Dow lagged behind, declining by 0.11%.

The Nasdaq was the last of the major U.S. stock benchmarks to reach a record close this year, when it achieved the milestone Thursday.

Stocks rose despite regional bank New York Community Bancorp's 25.9% decline following the announcement of a leadership change and disclosure of internal control issues. The bank has already dropped more than 65% in 2024, leading some investors to worry about a potential broader real estate shakeout.

Some major changes are expected now that other names are preparing to enter the market. For examplem Super Micro is ready to join S&P 500 after soaring more than 20-fold in two years. Also, Reddit is seeking a valuation of up to $6.5 billion in IPO.

Boo Boo Boeing: It looks like there's going to be more trouble for Boeing, which is in talks to buy back fuselage maker Spirit AeroSystems after spate of quality defects.

The company recently got fined $51 million for violating Arms Export Control Act. Plus, the FAA has identified more safety issues on Boeing’s 737 Max and 787 Dreamliner.

Biggest gainers and losers of the week: sponsored by The Yellowbrick Road

💵 Personal Finance

What is an ETF?

An ETF, or Exchange-Traded Fund, is a type of investment with shares that trade on stock exchanges. It holds assets such as stocks, commodities, or bonds and generally operates with an arbitrage mechanism designed to keep the trading close to its net asset value, though deviations can occasionally occur.

ETFs offer several benefits to investors, including:

• They help diversify as they hold a basket of securities, which can help reduce risk by spreading investments across multiple assets.

• They’re cheaper thanks to lower trading costs and expense ratios, especially when compared to mutual funds.

• Most ETFs regularly disclose their holdings, allowing investors to see exactly what assets they own.

• Are flexible as ETFs can be bought and sold throughout the trading day.

• ETFs are typically more tax-efficient than other options such as mutual funds.

• ETFs provide access to specific markets, sectors, or asset classes that may be difficult or expensive to invest in directly.

• Many ETFs offer dividend reinvestment plans, allowing investors to reinvest dividends automatically to purchase additional shares.

It’s very easy to invest in ETFs. Simply look for a brokerage that offers the ETF you’re interested in, open an account, and start investing. A few things to consider when selecting a broker include the fees, minimum deposit requirements, available asset types, customer service, and additional features such as portfolio rebalancing.

Check this video for more on how to invest in ETFs:

💰 Be a Better Investor

👩🏽‍⚖️ Legal Stuff
Nothing in this newsletter is financial advice. Always do your own research and think for yourself.

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