Today's key market insights

US markets

Stocks were up Friday after losing momentum in the middle of the week, causing the Dow to temporarily fall into the red for the year.

• After the rise on Friday, the Dow finished the week down 2.7% but remained up just under 1% for 2023. The S&P 500 lost 0.66% last week while the Nasdaq extended its winning streak to three weeks after gaining 0.55%.

• Netflix surged 8.5% on Friday after a larger-than-expected increase in subscribers, and Alphabet gained 5% after announcing it would lay off 6% of its workforce (12,000 employees).

• The current 10 Year U.S. Treasury yield is set at 3.47960%.

Canadian markets

Urbanation, a real estate consulting firm, has released a report looking into Toronto’s rental market last year.

• Despite a decline in housing prices in 2022, rent increased by 16.9% in the city, whereas it saw a 0.5% decrease in 2021.

• The increase is mainly due to immigrants and foreign students moving to the city once pandemic-related restrictions were lifted. Rising interest rates led to a decline in first-time homebuyers, which increased the demand for rentals.

• The average monthly rental price for a condo in Toronto was $2,752 at the end of last year, $391 more than in December 2021.

• Rental constructions decreased by 54% in 2022, showing that supply is unlikely to increase in the short term.

European markets

European markets were up slightly on Friday after falling on Thursday following a strong start to the week that saw the FTSE hit a new high.

• The Stoxx 600 rose 0.35% on Friday, led by travel stocks, which gained 1.2%.

• For the week, the Stoxx 600 lost 0.3%, with most of those losses coming during a sell-off on Thursday in response to weak corporate earnings and economic data from the U.S.

• Cellnex, a Spanish telecom company, was the best-performing stock in the Stoxx 600 on Friday, gaining 8.9%.

• Close Brothers, a British banking group, was the worst-performing stock, falling 10.3%.

Asian markets

Stocks In Asia were up on Friday despite Japan’s inflation hitting a 41-year high.

• Singapore’s tourism board said that despite China’s reopening, the number of Chinese tourists visiting the island country is unlikely to return to pre-pandemic levels this year.

• Stocks in China continue to have positive momentum following the country’s lifting of most Covid restrictions, with the Hang Seng, Shanghai Composite, and Shenzhen Component all rising last week.

• The Nikkei rose on Friday after new data showed that consumer prices rose by 4% in December on an annualized basis, a 41-year high. The index fell on Thursday in response to the Bank of Japan unexpectedly maintaining its monetary policy.

Commodities

Oil prices rose on Friday and have now increased for two consecutive weeks.

• Both Brent crude and U.S. West Texas Intermediate gained just over 1% on the day.

• The positive outlook created by China’s removing Covid restrictions and reopening its economy continues to outweigh concerns over the global economy’s health.

• The U.S. oil rig count is at its lowest since November, which pushed prices up as it suggests a decline in domestic supply.

Currency exchange rates

The Yen was down on Friday after weeks of gains as markets re-adjust following the Bank of Japan’s monetary policy decision on Thursday.

• The Yen gained over 14% against the U.S. Dollar over the past three months amid expectations that the Bank of Japan would tighten its monetary policy.

• The U.S. Dollar has regained nearly 2% against the Yen in the two U.S. trading days since the Bank of Japan decided to continue having ultra-low interest rates.

• The USD still fell against other currencies on Friday and is expected to continue falling in the first half of 2023.

Cryptocurrency

Bitcoin surged over 10% on Friday before falling after Genesis filed for bankruptcy.

• Genesis lost $1.2B when Three Arrows Capital filed for bankruptcy last summer. The crypto lending firm lost funds and had to freeze withdrawals when customers left exchanges following FTX’s bankruptcy in December.

• Genesis is FTX’s largest unsecured creditor, with $226M in claims.

• In its bankruptcy filing, Genesis claimed that it has over $5.1B in liabilities.

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