Nasdaq 100 Tumbles, Ends 11% Below Feb. 12 Record

Tech shares tumbled anew, sending the Nasaq 100 Index down 11% from its all-time high, as investors fled high-valuation stocks for companies whose fortunes are closely tied to the economic cycle. The S&P 500 fell by 0.54% to 3,821.35 while Dow Jones was up 306.14 points (0.97%) to 31,802.44.

Yellen Says Stimulus Unlikely to Cause Inflation Problem

Treasury Secretary Janet Yellen dismissed fears that President Joe Biden’s US$1.9 trillion pandemic-relief bill is so big that it will cause an inflation problem, as she seeks to push the recovery deeper into the US labor market to address long-standing economic disparities. Yellen called the impact on women and minorities from Covid-19 “absolutely tragic.”

Powell’s Dashboard Shows How Far US Economy Has to Go on Jobs

Federal Reserve Chair Jerome Powell says he and his colleagues have learned a lot over the last decade about the meaning of full employment. Now, they’re looking at a new set of labor-market indicators as they chart a recovery from the steepest economic downturn on record. It’s an important development for Fed watchers to grasp in gauging how long policy makers will keep interest rates near zero as they judge incoming data, including Friday’s jobs report.

ECB Pandemic Purchases Stay Muted Amid Drag of Maturing Debt

The European Central Bank kept up a muted pace of pandemic bond-buying for a second week as maturing debt acted as a brake on officials’ stimulus efforts. The institution settled 11.9 billion euros (US$14.2 billion) of net buying under its Pandemic Emergency Purchase Program last week, similar to the 12 billion-euro outcome of the prior week.

France Avoids Another Recession With Growth in First Quarter

The French economy will avoid a second recession in the Covid pandemic as a steadying of activity is enough to fuel “slight growth” in the first quarter of the year, the Bank of France said. Based on its monthly surveys of 8,500 firms, the central bank estimates economic activity rose to a plateau 5% below pre-crisis levels in December and will remain there through March.

BOE Governor Says Risks to UK Economy Remain Tilted to the Downside

Bank of England Governor Andrew Bailey said risks to the UK economy remain tilted to the downside, a remark that may rein in expectations that policy makers may soon shift toward containing inflation. Bailey reiterated the bank’s guidance that it doesn’t intend to tighten monetary policy until there’s clear evidence the economy is absorbing excess capacity, and he noted that unemployment is likely to rise and remain higher a year from now.

China Vows to Expand Legal ‘toolkit’ to Fight US Sanctions

Beijing pledged to speed up legislation aimed at countering US sanctions, as it seeks to narrow Washington’s advantages in disputes after the Trump administration levied waves of penalties against China. Measures were announced by National People’s Congress Standing Committee Chairman Li Zhanshu as part of his annual report to the Chinese legislature.

Oil Falls Most in a Week With Stronger US Dollar Cooling Rally

Oil fell the most in a week as the dollar strengthened and investors shrugged off an attack on the world’s largest crude terminal in Saudi Arabia. Brent crude for May settlement declined US$1.12 to US$68.24 per barrel.

Source: Affin Hwang Research - 9 Mar 2021