Welcome back,

The market in a nutshell today: 🔴.

Let’s keep it concise.

Market Headlines 👀

• US jobless claims rise 211,000 (est. 195K; prev. 190K).

• US challenger layoffs reported at 77.77K (prev. 102.943K).

• US household wealth rebounded to $147.7T in the 4th quarter.

• The average 30-year fixed-rate mortgage in the US increased for its fifth straight week, up to 6.73% (prev. 6.65%).

• President Biden to urge 25% billionaire tax and significant levies on rich investors.

• President Biden unveils $6.9T budget, setting up showdown with GOP.

• SVB Financial Group's (SIVB) $1.8B share sale announcement causes banks to tumble in Thursday trading.

• Credit Suisse (CS) delays annual report after last-minute SEC call.

• Uber (UBER) is considering spinning off its freight logistics division.

• Citigroup (C) to recalibrate investment banking workforce as required.

• US and EU to launch talks on free-trade-like status, easing EV trade dispute.

• China's CPI increased 1% year-over-year in February (est. 1.9%), despite being down 0.5% compared with January.

• Australian yields hit pandemic-era lows to US as RBA diverges.

Earnings 💸

• JD.Com (JD)

  • EPS: $0.70 beats (exp. $0.50)

  • Revenue: $42.84B beats (exp. $42.73B)

• BJ’s (BJ)

  • EPS: $1.00 beats (exp. $0.89)

  • Revenue: $4.93B beats (exp. $4.80B)

• Ulta Beauty (ULTA)

  • EPS: $6.68 beats (exp. $5.68)

  • Revenue: $3.23B beats (exp. $3.04B)

• DocuSign (DOCU)

  • EPS: $0.65 beats (exp. $0.52)

  • Revenue: $659.6M beats (exp. $639.5M)

• Oracle (ORCL) (Q3)

  • EPS: $1.22 beats (exp. $1.20)

  • Revenue: $12.4B misses (exp. $12.41B)

Recap Around the Street 🧠

All eyes now shift to Friday’s highly anticipated nonfarm payrolls (i.e. private sector) report following Fed Chair Powell’s testimonies on the potential for higher rate hikes. A little heat in the jobs report would give the Fed some room and reason it desperately needs for a bigger rate hike.

As a proxy, ADP’s nonfarm data came in at 242K for February (est. 200K; prev. 106K). For Friday’s report, nonfarm payrolls are forecast to have risen by 200K, after an astonishing 517K print last month. The unemployment rate is expected to have remained unchanged at 3.4%, while wages are projected to have risen at a faster pace.

Nonetheless, there is a risk of disappointment. When a nonfarm payrolls print is as strong as it was last month, it is often followed by a softer number. Essentially, there is a correction back to the prevailing trend. Considering also that warmer weather and seasonal adjustments played a big role in boosting the last number, some “payback” would be normal this time.

Chinese consumer inflation fell well below expectations in February. The weak price pressures give the People’s Bank little economic headroom to tighten monetary policy and support the yuan, which is once again trading dangerously close to the dollar.

China’s Consumer Price Index inflation (CPI) rose 1% in the year up to February, data from the National Bureau of Statistics released today. The reading was lower than expectations of 1.9% – still softer than last month’s reading of 2.1%.

Meanwhile, China’s Producer Price Index (PPI) inflation continued to worsen, falling 1.4% in the year up to February. The data was weaker than expectations for a drop of 1.3%, and last month’s reading of negative 0.8%.

The data reveals that despite a recovery in business activity, an economic rebound in China is still in an early stage, as the country struggles to recover from three years of strict COVID restrictions. While China’s manufacturing sector returned to expansion territory in February, the weak PPI reading indicates that the sector – usually a dominant force for the Chinese economy – is still running well below full capacity.

Market Preview 🎞️

• Friday: US nonfarm payrolls, unemployment rate, monthly budget statement, Bank of Japan policy rate decision, Apple (AAPL) annual shareholder meeting

Set a reminder to tune into our next Twitter Spaces March 13th at 3PM EST. We’ll be previewing the CPI release and its macroeconomic implications, featuring a slate of speakers you won’t want to miss.

That’s all for this week, folks! We’ll be back around the same time next Monday with a curated list of important news, economic data and market highlights. 

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