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The US stock markets continued their rally yesterday. By Thursday's close, the Dow Jones Index (US30) decreased by 0.11%, while the S&P 500 (US500) gained 1.48%. The Nasdaq Technology Index (US100) jumped by 3.25%.

Investors are investing in tech stocks after the Meta rally. The artificial intelligence technology boom in recent months has forced investors to pour money into technology. The market has also been helped by renewed confidence that the Federal Reserve will stop raising rates sooner than originally planned.

Tesla (TSLA) added another 3% to its recent rally after it was announced that the company would increase production at its Shanghai plant to nearly 20,000 vehicles per week. Apple's (AAPL) results for the quarter fell short of estimates due to a drop in iPhone revenue. iPhone's revenue fell about 8% to $65.78 billion amid a difficult macroeconomic environment and significant supply constraints. Apple stock fell by 3% after the report was released. Alphabet (GOOGL) reported lower-than-expected fourth-quarter earnings and revenue as lower spending on online advertising affected results. The company also said its first-quarter results would reflect lower spending related to job cuts. Shares of Alphabet Inc. fell more than 1% on the report. Amazon (AMZN) was also unhappy with the results.

Operating profits continued to fall in the current quarter. Faced with high inflation and a volatile economy, the company has set its sights on cutting costs across various businesses. Shares fell 5% after the market closed. Ford Motor Co (F) said Thursday that fourth-quarter profit fell from a year earlier. The automaker blamed supply chain problems and production "instability, " leading to higher costs and lower volumes. Ford shares fell more than 6% on the report after the close of the main session.

Stock markets in Europe were mostly up yesterday. Germany's DAX (DE30) gained 2.16%, France's CAC 40 (FR40) added 1.26%, Spain's IBEX 35 index (ES35) jumped by 1.45%, and Britain's FTSE 100 (UK100) closed Thursday up by 0.76%.

The ECB, as expected, raised its interest rate by 0.5% yesterday. The US Fed is ending its rate hike cycle and will soon talk about ending quantitative easing (QT), with the ECB about halfway through and planning to start QT in March. This situation is good for the euro as the spread between the euro, and the dollar will continue to narrow.

The Bank of England announced another "sharp" interest rate hike on Thursday, saying it was too early to declare victory over inflation. The bank raised its key rate from 3.5% to 4%. Nevertheless, the bank tempered expectations of further rate hikes, dismissing suggestions that it would respond "strongly" to price pressures and implying that future changes would be smaller.

Oil prices fell Thursday as US factory orders fell and the dollar strengthened, making oil more expensive for non-US buyers. This indicates a further slowdown in the economy, especially in manufacturing, which is negatively affecting oil. Investors have become less confident about the strength of the oil outlook. But analysts are still confident in a bullish scenario for the "black gold" due to the rebounding economy of China (the largest oil importer). It is also worth remembering that the ban on Russian oil will come into effect on February 5, which may strike a blow to global supplies.

The unusually warm start to the winter of 2022/23 resulted in a significant reduction in heating demand in the United States and Europe compared to the norm, leaving more gas in storage than originally anticipated. This has led to a drop in natural gas prices over the past two months. But the situation may change dramatically with the onset of cold weather, which weather forecasters predict for the second half of February.

Asian markets traded flat yesterday. Japan's Nikkei 225 (JP225) gained 0.20%, China's FTSE China A50 (CHA50) decreased by 0.34%, Hong Kong's Hang Seng (HK50) lost 0.52%, India's NIFTY 50 (IND50) fell by 0.03%, and Australia's S&P/ASX 200 (AU200) was up by 0.13% on the day.

The mixed economic data released reinforced concerns about China's rapid recovery after the repeal of the zero COVID-19 policy. While the country's services sector recovered sharply in January after a four-month slump, a private survey showed that small-scale manufacturing firms still struggle with rising COVID-19 cases and lingering supply chain problems.

Severe flooding in New Zealand's largest city, Auckland, has increased inflationary pressures and is creating a new cost-of-living headache for Prime Minister Chris Hipkins, who is trying to win back support for his party before the election.

• S&P 500 (F) (US500) 4,179.76 +60.55 (+1.47%)
• Dow Jones (US30) 34,053.94 −39.02 (−0.11%)
• DAX (DE40) 15,509.19 +328.45 (+2.16%)
• FTSE 100 (UK100) 7,820.16 +59.05 (+0.76%)
• USD Index 101.74 +0.53 (+0.53%)
   

Important events for today:

• Eurozone Services PMI (m/m) at 11:00 (GMT+2);
• UK Services PMI (m/m) at 11:30 (GMT+2);
• Eurozone Retail Sales (m/m) at 12:00 (GMT+2);
• Eurozone Producer Price Index (m/m) at 12:00 (GMT+2);
• US Nonfarm Payrolls (m/m) at 15:30 (GMT+2);
• US Unemployment Rate (m/m) at 15:30 (GMT+2);
• US ISM Services PMI (m/m) at 17:00 (GMT+2).

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